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November 19, 2003 - 13,525 subscribers
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“What You Need to Know About FMLA and Workers’ Compensation”

90-Minute Interactive Audio Conference
Monday, November 24 * 2:00 p.m. ET

When is an injury covered by both FMLA and workers’ compensation laws?
May an employer grant both FMLA and workers’ comp leave at the same time?
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(Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor)
SEC Chair Proposes Mutual Fund Industry Changes
Excerpt: "[Securities and Exchange Commission Chairman William H.] Donaldson said he was open to most suggestions for change, but he opposed a new oversight board for the mutual-fund industry similar to the Public Company Accounting Oversight Board ... Donaldson said the commission could adopt changes in the next two months that would require ... [f]unds to complete all daily transactions by 4 p.m. This would end after-hours trading by preferred investors and insiders." (The Philadelphia Inquirer)

Written Testimony of Securities Industry Association at Hearing on Mutual Fund Industry Reforms (PDF)
21 pages. Excerpt: "[W]e think that a hard close that can only occur at the mutual fund has some significant drawbacks for investors, and also may have some major operational difficulties. A hard close at NSCC may best meet concerns about a verifiable order entry deadline, while a hard close at the broker-dealer or other intermediary would be preferable from the vantage point of most retail investors and retirement plan participants." (U.S. Senate Committee on Banking, Housing and Urban Affairs)

Written Testimony of Investment Company Institute at Nov. 18 Hearing on Mutual Fund Industry Reforms (PDF)
25 pages. Excerpt: "The most effective solution to this problem would be to require that all purchase and redemption orders be received by a fund (or its transfer agent) before the time of pricing (e.g., 4:00 p.m. Eastern time). While such a requirement could have a significant impact on the many investors who own mutual funds through financial intermediaries, the recent abuses indicate that the strongest possible measures are necessary to ensure investor protection." (U.S. Senate Committee on Banking, Housing and Urban Affairs)

Written Testimony of SEC Chair at Nov. 18 Hearing on Mutual Fund Industry Reforms (PDF)
30 pages. Excerpt: "[O]n December 3, the Commission will consider the staff's proposal to require that a fund (or certain designated agents)-- rather than an intermediary such as a broker-dealer or other unregulated third party-- receive a purchase or redemption order prior to the time the fund prices its shares (typically, 4 PM) for an investor to receive that day's price. This 'hard' 4 o'clock cut-off would effectively eliminate the potential for late trading through intermediaries ..." (U.S. Senate Committee on Banking, Housing and Urban Affairs)

Jacksonville, Florida Fund Drops Putnam
Excerpt: "The City fired Putnam Investments Tuesday from its management of two pension funds worth $190 million. The City's finance director said the decision was made after learning that Massachusetts securities regulators are investigating the Boston–based company's top legal officer." ([Jacksonville, Fl.] Financial News & Daily Record)

Hawaii Public Fund Pulls Out of Putnam
Excerpt: "Trustees of the [Hawaii] state Deferred Compensation Plan have voted to withdraw from a $43 million dollar mutual fund managed by Putnam. The retirement fund, now known as Island Savings Plan, covers 30-thousand state employees." ([Hilo, Hawaii] KPUA)

Largest State-Run 401(k) Plan Targets Mutual Fund Fees
Excerpt: "Richard Moore, North Carolina's treasurer, has threatened to drop certain mutual funds from the state's 401(k) retirement plan-- the largest public one of its kind in the U.S.-- if they do not slash their fees and improve their transparency." (Financial Times)

Link to PLANSPONSOR's 2003 Defined Contribution Survey
Excerpt: "A record 3,247 plan sponsors representing more than 8 million participants responded to our survey this year ..." (PLANSPONSOR.com; one-time registration required)

Is the Mutual Fund Issue Abuses, or Is It Fees?
Excerpt: "The coming battle over mutual fund regulation may well end up focusing not on trading abuses, which are now the subject of regulatory action, but on the fees and costs that funds charge investors." (New York Times; one-time registration required)

Rethinking Cash Balance Plans
Excerpt: "To freeze or not to freeze? That is the question -- and for many employers that have a cash balance pension plan or that are considering a conversion, it's apparently one of the hardest to answer." (CFO.com)

Union Representatives Pull Out of Plans for ESOP Buyout of Closed Mississippi Mill
Excerpt: "Natchez Fiber had worked for months with commercial banks, venture capitalists and local, state and federal officials to raise funds to buy the mill through an employee stock option [sic] plan, or ESOP." (The Natchez (Miss.) Democrat)

Section 457 Plans Should Be Reviewed by Year-End
Excerpt: "Although it is not absolutely clear from the final regulations that plan amendments must be adopted by January 1, 2004, we recommend that all section 457 plans be reviewed and amended by January 1, 2004 to include the changes made by the final regulations." (Chang, Ruthenberg & Long PC)

Retirement Plan Options for California Governmental and Public Agencies
Excerpt: "California governmental employers have more alternatives than they realize for providing significant and cost-effective retirement benefits to their employees. This article explains some of the options, other than CalPERS, that are available to public agencies and the reasons for considering these options." (Chang, Ruthenberg & Long PC)

Native American Tribal Retirement Plans: What Rules Apply?
Excerpt: "With the advent of casino gaming there is new interest in the tax treatment of tribes and their retirement plans. Unique rules apply to Native American tribes under the Internal Revenue Code. Although tribes are treated the same as State governments for some tax purposes, retirement plans sponsored by tribes are not 'governmental' plans as defined under Code section 414(d). Tribal plans need to be in compliance with all applicable Code qualification rules." (Chang, Ruthenberg & Long PC)

Atlanta Police, Firefighter, General Employee Pension Boards Want Out of City Control
Excerpt: "The city's chief financial officer, Rick Anderson, who sits on the pension boards, said the police and fire representatives have legitimate frustrations in that the pension managers don't always answer questions about administration of the funds -- but the CFO said those concerns had morphed into paranoia and baseless accusations of rampant wrongdoing." (The Atlanta Journal-Constitution)

US Airways, Alabama Promote Each Other In Ads
Excerpt: "It's part of the multimillion-dollar synergy between the airline and a state whose pension program is the largest stockholder in the airline." (AP via [Northwest Alabama] TimesDaily.com)

Nebraska Government Retirement Plans Need a Boost -- But Who Pays?
Excerpt: "Nebraska teachers and state troopers may have to dig deeper into their pockets and purses to secure their retirement. Or more money might come from the general fund, the Nebraska Public Employees Retirement Board and Nebraska Investment Council were told Tuesday." (Lincoln [Neb.] Journal Star)

Minimum Distribution Amendment Deadline Is December 31, 2003
Excerpt: "Have you amended your defined contribution plan for the final Treasury regulations governing required minimum distributions (RMDs) under Code section 401(a)(9)? If not, you need to act now! ... The deadline for plan amendments is the later of (i) the last day of the 2003 plan year or (ii) the last day of the GUST remedial amendment period for the plan." (Chang, Ruthenberg & Long PC)

Some Pre-Approved Plans Have Until January 31, 2004 to Submit GUST/EGTRRA Update/Restatement to IRS
Excerpt: "If (i) you have made changes to the plan beyond those allowed by the adoption agreement; or (ii) you need the IRS's blessing for any other reason (e.g., to make sure that certain coverage and discrimination aspects of your plan are okay); or (iii) you failed to adopt the GUST/EGTRRA update or restatement of your pre-approved plan by September 30, 2003, you must also file an application for a determination letter for your plan with the IRS by January 31, 2004." (Chang, Ruthenberg & Long PC)

Grasshoppers, Ants, and Pre-Retirement Wealth: a Test of Permanent Income
Working paper. Excerpt: "[H]ouseholds who entered retirement with lower than predicted wealth consistently followed near sighted consumption plans during their working lives." (Erik Hurst; working paper description provided by National Bureau of Economic Research)


Links to Items on Executive Comp, Benefits in General

Text of Massachusetts Gay Marriage Decision
Complete text of the Massachusetts Supreme Judicial Court's November 18, 2003 decision in Goodridge vs. Department of Public Health, SJC-08860 (the case striking down state law prohibitions on same-sex marriage) is now available online. (Calhoun Law Group, P.C.)

Overview: Mass. High Court Strikes Down Gay Marriage Ban
Excerpt: "The Massachusetts Supreme Judicial Court rules that a law banning same-sex marriages is unconstitutional. The four-to-three opinion says gay couples are legally entitled to marry under the state constitution. But the ruling stops short of allowing marriage licenses to be issued to the seven gay couples who had challenged the law." (National Public Radio)

Public Divided On Many Issues Regarding Homosexuality, Survey Finds
Excerpt: "The poll ... found that opposition to gay marriage has grown since midsummer, with 32% favoring it and 59% opposing it. In July, 53% said they opposed gay marriage.... Roughly half those polled said they have unfavorable opinions of gays and lesbians. But the survey found widespread opposition to discrimination against homosexuals." (USA Today)

Attorney General Says Alabama Won't Recognize Gay Marriages
Excerpt: "'Under the federal Defense of Marriage Act and the Alabama Marriage Protection Act, the State of Alabama is not required to and will not recognize same-sex marriages or civil unions from other states,' the Republican attorney general said." (TimesDaily.com)

Lesbian Couple Wins Landmark Ruling by Massachusetts Highest Court
Excerpt: "On Tuesday, Massachusetts' highest court ruled that same-sex couples are legally entitled to wed under the state constitution." (Boston Globe)

Group Starts $1M Gay Marriage Campaign
Excerpt: "On Monday the Human Rights Campaign (HRC) revealed its $1 million ad campaign aimed at educating the public about why same-sex couples deserve civil marriage licenses." (Gay.com)

Massachusetts Ruling Should Have Little Effect on Businesses Sponsoring ERISA-Covered Plans
Excerpt: "While many companies already extend employee benefits to same- and opposite-sex spouses, ERISA exempts the private sector from yesterday's Supreme Court decision, [Rob Webb, an attorney and partner at the law firm of Nutter, McClennen & Fish in Boston] said. 'Compared to [Massachusetts] public employees, this won't have nearly the same effect on the business community,' he said." (Daily News Tribune)


Newly Posted or Renewed Job Openings
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Newly Posted Press Releases
(Post Yours!)

Ben Stein Kicks Off National Retirement Planning Week 2003
(National Retirement Planning Coalition (NRPC))

VPA, Inc., Teams Up With BenefitPoint, Inc. To Offer Brokers And Consultants Access To Absence And Disability Benefits Outsourcing Services To Self-Funded Employers
(VPA, INC.)

Principal Financial Group Adds 412i Defined Benefit to Complete Solutions Portfolio
(Principal Financial Group)

Perquest Brings Payroll Industry Into 21st Century
(Perquest, Inc.)

Perquest Introduces Online Payroll Service For Small Businesses
(Perquest, Inc.)

National Retirement Planning Coalition Report Reveals Risks to Retirement Income
(National Retirement Planning Coalition)

Great-West Retirement Services Completes Transaction With Federated Insurance For Group Retirement Business
(Great-West Retirement Services)


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