February 25, 2003 - 13,051 subscribers Today's sponsor: Thompson Publishing Group, Inc. (Click on company name or banner to learn more.) 2003 Update on Pension Activity Audio Conference Feb. 27, 2003 * President Bush's proposal * Bills introduced on the Hill * Shrinking 401(k) balances * PBGC * Real world application of future pension action Martha Priddy Patterson, director of benefits policy analysis for Deloitte & Touche, and Robert Davis, manager with Deloitte & Touche, will bring you up to date on these points and more. Plus-- you'll get answers to your tough questions on this revolving issue at the end of the audio conference. (Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor) US Airways Pilots Say Strike an Option Excerpt: "Pilots at US Airways Group Inc. are laying the groundwork for a potential strike if the company replaces their current pension plan with a cheaper one over their objections, and other options to challenge that action fail, union leaders said on Monday." (Reuters via the Washington Post) Opinion: Better Not Try To Save Your Defined Benefit Pension with Duct Tape Excerpt: "The Bush administration has a plan (those are rapidly becoming the six most chilling words in the English language) to de-improve your pension. It allows companies to switch from traditional fixed-benefit retirement plans to what's called the cash-balance pension plan." (Molly Ivins in the Naples [Fla.] News) Pension News Grows Gloomier for New York Local Governments Excerpt: "Mayors from across [New York state] who came to the capital Monday seeking relief from skyrocketing pension costs instead heard the increase could be even worse." (The [Rochester, N.Y.] Democrat & Chronicle) Some Say Benefit Increases Are Hurting New York State Pension Fund Excerpt: "The mantra from Albany is that Wall Street is to blame for ballooning government costs.... But there are other culprits, critics say, making the pension funds more expensive: the State Legislature and Gov. George E. Pataki." (The Buffalo News) Employee Ownership Update for February 24, 2003 NCEO Executive Director Corey Rosen discusses the reintroduction of retirement reform bills and how they affect company stock in ESOPs and 401(k)s; bills to reform stock option accounting; SEC opinions on shareholder proposals regarding performance-based options; and the sale of one of the largest majority ESOP-owned companies. (National Center for Employee Ownership) Another Question is Answered in the Prototype Plans Q&A Column What is the difference between a prototype plan and a volume submitter plan? (BenefitsLink.com) Another Question is Answered in the Who's the Employer Q&A Column A company recently started utilizing a PEO. It had a 401(k) plan in place when the relationship with the PEO began. The plan excludes leased employees. Should it be amended to "not" exclude leased employees, due to the relationship with the PEO? (BenefitsLink.com) Strategies for Liquidating Assets at Retirement Excerpt: "Financial companies and their representatives increasingly deal with retired clients who need to spend down some of their assets to make ends meet. Once it is determined that it is appropriate to do so, the next question is: which specific asset(s) should be liquidated? We'll look at four different strategies for answering this question, and explain why one of them appears to be more useful than the others." (Still River Retirement Planning Software, Inc.) Retired Federal Employees Stand To Lose If 'Windfall' or 'Offset' Laws Intact Excerpt: "Current and future federal retirees will lose tens of millions of dollars over the next decade unless Congress votes to modify or repeal two little-known but hard-hitting formulas used to reduce their Social Security benefits. The offending-- if you're a fed-- formulas are called 'Windfall' and 'Offset.'" (Washington Times) Variable Annuity Challenge Excerpt: "Are variable annuities right for your clients? That's the title of an article in the January Journal of Financial Planning. James D. Peterson and Yongling Ding, both researchers at the Schwab Center for Investment Research in San Francisco, wrote it." (Scott Burns via the Houston Chronicle) Links to Items on Executive Comp, Benefits in General What ERISA Means by 'Equitable': the Supreme Court's Trail of Error in Russell, Mertens & Great-West Working paper; available for downloading from SSRN.com at no cost. Excerpt: "This paper explains why and how the Court's interpretation of ERISA remedy law went wrong, beginning with the Court's earlier encounter with the field in Russell (1985).... Congress intended ERISA remedy law to replicate the core principles of trust remedy law in the regulation of pension and benefit plans, including the long-familiar make-whole standard of trust remedy law." (Prof. John Langbein, published by the Social Science Research Network) Canadian Government Pension Plan to Oppose Use of Stock Options Excerpt: "The investment arm of Canada's publicly funded pension plan warned on Monday it will start using its voting power to pressure companies to drop stock option plans and improve governance." (Reuters) Newly Posted or Renewed Job Openings Employee Benefits Attorney for Womble Carlyle Sandridge & Rice, PLLC in DC Administrative Analyst for ICMA Retirement Corporation in DC Director - Pension Management for Travelers Property Casualty in CT 401k Director for ADP TotalSource in Miami, FL in FL 401k Plan Specialist for ADP TotalSource in Miami, FL in FL Newly Posted Conferences (Post Yours!) Consumer Directed Health Care Conference & Expo in NV April 7, 2003 The Emergent Group Newly Posted Press Releases (Post Yours!) Alexander Hamilton Institute Releases New Free Report-- "Discipline Done Right" (Alexander Hamilton Institute) Handy Links:
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