| The BenefitsLink Newsletter - Retirement Plans Edition |  |
July 03, 2001
Today's sponsor: The International Quality & Productivity Center (click)
The International Quality & Productivity Center presents a powerful conference on "Winning Strategies for Measuring & Improving Work/Life Initiatives," July 30-August 1, 2001 at the Hyatt Regency in San Francisco, CA. By attending, you will from over 12 leading organizations on how to improve your workforce and become an "employer of choice," including: Texas Instruments, Inc., Fannie Mae, Eddie Bauer, Inc., DuPont, Wachovia Bank, WFD Consulting, Boston College Center for Work & Family and many more! For more information, please call 1-800-882-8684 or visit: http://www.iqpc.com/G067worklife160701
Sal Tripodi Summarizes Finalized "New Comparability" Regulations
Excerpt: "The effective date is plan years beginning on or after January 1, 2002. This is a uniform effective date that applies to all new comparability defined contribution plans, regardless of whether the plan was in existence when IRS announced its review of new comparability plans (Notice 2000-14) or was adopted after that date." (TRI Pension Services, Inc.)
New Tax Law Addresses S Corporation ESOP Abuses
Excerpt: "The Economic Growth and Tax Relief Reconciliation Act of 2001 signed by President Bush on June 7, 2001 contains a long-sought provision cracking down on perceived abuses in the S corporation ESOP area." (Luis Granados of McDermott, Will & Emery, for the Foundation for Enterprise Development)
ESOP Provisions in the Economic Growth and Tax Relief Reconciliation Act of 2001
In the first installment of a series on the effects of the Economic Growth and Tax Relief Reconciliation Act of 2001, administrator and consultant Anthony Mathews of BCI Group discusses the ESOP provisions of the new law. (National Center for Employee Ownership)
More on EGTRRA Guidance
Excerpt: "[Under Notice 2001-42,] the general GUST remedial amendment period ... will NOT be extended. However, for plans that are able to use the '12-month rule' that applies to adopters of certain prototype or volume submitter plans, the GUST remedial amendment period has been extended to the later of December 31, 2002, or ... the end of the 12th month beginning after the date on which the Service issues a GUST opinion or advisory letter for the prototype or volume submitter plan." (SunGard Corbel)
ASPA ASAP on Gramm-Leach-Bliley Privacy Act Notification Issues
Excerpt: "Many ASPA members have recently received privacy notices from financial institutions such as banks and credit card companies. These notices are being sent pursuant to the Gramm-Leach-Bliley Act ('GLBA') and questions have arisen as to whether service providers for employee benefit plans are subject to the notice requirement." (James (Telk) Elkus and R. Bradford Huss, Esq. for the American Society of Pension Actuaries)
Some Defined Contribution Plans Rocket Skyward on Employer Stock Holdings
Excerpt: "The value of Southern Co.'s employee savings plan soared by $464 million in 2000 on the strong performance of its shares. The majority of the plan consists of company stock, whose value rose some $540 million in 2000, offsetting other losses in the retirement plan." (Atlanta Business Chronicle)
National Saving: Answers to Key Questions
163 pages. Loaded with statistics, charts and policy discussions in a Q&A format. Excerpt: "Higher saving and investment in a nation's capital stock contribute to increased productivity and stronger economic growth over the long term. Saving today increases a nation's capacity to produce goods and services in the future and, therefore, helps to increase the standard of living for future generations." (U.S. General Accounting Office)
Clinton Eyed Private Social Security Accounts
Excerpt: "President Clinton and his economic advisers spent 18 months secretly discussing the elements of a plan to add individual investment accounts to Social Security, but abandoned it when it became clear the president would be impeached, according to a paper by three former administration officials that will be presented today at a Harvard conference." (Washington Post)
Need for Social Security Overhaul Questioned
Excerpt: "The White House's Social Security commission is rekindling a fight over whether the 66-year-old retirement program needs an overhaul as the panel lays the groundwork for its recommendations on private investment accounts. The commission is preparing to report by the end of July ... Already lawmakers, administration officials and analysts are squaring off over the extent of the retirement system's financial woes." (Reuters via Yahoo! News)
New Pension Laws: Special Alert (PDF)
4 page summary of principal provisions of EGTRRA. (Trucker Huss)
401(k) Plans Working Well 20 Years Later, But Could Be Better
Excerpt: "One big problem is that about 40 percent of workers don't even have access to a plan. Workers at small businesses, in particular, are often locked out because their employers feel they don't have the resources to administer a plan.... But even at workplaces where it is offered, an average of 20 percent don't join-- either because they don't understand it or because they feel they can't afford it. And many of those who do sign up are overwhelmed and baffled by their investment choices." (The [Bergen County, N.J.] Record)
Online Account Aggregation Gains Steam, but Should You Try It?
Excerpt: "Financial institutions are beginning to offer this Web-based service, which consolidates your online account balances onto a single page, hoping that they can use the information about your finances to cross-sell and 'upsell' you their own products." (TheStreet.com via Yahoo! Finance)
Interim CEOs Receive Unusual Pay Packages
Excerpt: "Interim leaders are becoming part of the corporate landscape as more troubled companies look for fast help in the executive suite. And unusual circumstances can lead to unusual pay packages." (CareerJournal.com)
Benefits Implications of the Gramm-Leach-Bliley Act's Privacy Provisions
Excerpt: "In general, employee welfare and pension benefit plans do not appear to have an obligation to provide GLB 'privacy' notices to their participants and beneficiaries.... However, other vendors that provide services to the plans, such as insurers, HMOs, and third party administrators, might be obligated to provide plan participants with a notice of their privacy policies, and a right to opt out of information sharing." (The Segal Company)
Reps and Warranties Insurance: Shifting Risk in M & A Deals
Excerpt: "[A] relatively new insurance product-- representations and warranties insurance (also sometimes referred to as mergers and acquisitions insurance)-- is available to bridge seemingly irreconcilable gaps between buyers and sellers. Representations and warranties insurance ('RWI') can be an effective way to shift risks from buyers and sellers to insurers and resolve impasses over risk allocation issues. However, RWI is relatively expensive and not appropriate for every transaction." (Faegre & Benson LLP)
The Impact of Employee Stock Options on the Evolution of Compensation in the 1990s
Working paper available for downloading ($5 fee to NBER). (National Bureau of Economic Research)
Newly Posted or Renewed Job Openings (Post Yours!)
| 401k Compliance Testing Analyst | for Automatic Data Processing- Retirement Services in NJ |
| Compliance Manager | for Fidelity Investments in MA, NH |
| Manager, Pension Department | for MEBA Benefit Plans in MD |
| New York-Associate Benefit Consultant | for Buck Consultants in NY |
| 401(k) Administrator, Daily Valuation Plans | for CNA TRUST in CA |
Newly Posted Conferences (Post Yours!)
| Benefits Provisions of the New Tax Act | in ALL STATES on July 12, 2001 presented by ABA, American College of Employee Benefits Counsel and Society of Actuaries |
| Online Study Group for Course 1 | in ALL STATES on September 10, 2001 presented by IFEBP/Certified Employee Benefit Specialist (CEBS) Program; co-sponsor The Wharton School |
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