| BenefitsLink Retirement Plans Newsletter |   |
September 28, 2004
Today's sponsor: The BenefitsLink Jobs Board
(Click on company name or banner to learn more.)
Where the best benefits employers find the best candidates Fill your employee benefits job openings fast by advertising on BenefitsLink. What better place to find qualified candidates? Your help wanted ad will be listed in the BenefitsLink Newsletter, will be seen by thousands of candidates who view our listings online, and will be emailed to over 3,200 job-seekers. Click above to see how easy it is to place an ad!
Text of Final Reg on Fiduciary Duty Safe Harbor for Automatic Rollovers to IRAs by Plans (PDF)
13 pages. Excerpt: "This document contains a final regulation that establishes a safe harbor pursuant to which a fiduciary of a pension plan subject to Title I of the [ERISA], will be deemed to have satisfied his or her fiduciary responsibilities in connection with automatic rollovers of certain mandatory distributions to individual retirement plans.... This final regulation is effective March 28, 2005." (U.S. Department of Labor, Employee Benefit Security Administration)
Text of Prohibited Transaction Class Exemption on Establishment of Rollover IRAs by Employers (PDF)
7 pages. Excerpt: "The exemption permits a fiduciary of a plan who is also the employer maintaining the plan to establish, on behalf of its separated employees, an individual retirement plan at a financial institution which is the employer or an affiliate, in connection with a Mandatory Distribution, as defined herein. Relief also is provided for a plan fiduciary to select a proprietary product as the initial investment for such individual retirement plan." (U.S. Department of Labor, Employee Benefits Security Administration)
DOL Finalizes Safe Harbor Relief for Automatic Rollover of Small Retirement Plan Cashouts to IRAs
Excerpt: "The Labor Department issued final rules [September 27] to protect retirement plan fiduciaries from liability in connection with automatic rollover of mandatory cashouts, effective March 28, 2005.' Mercer includes links to the full text of the final DOL rule (9/27/04) (PDF) and the full text of the prohibited transaction class exemption (DOL, 9/27/04) (PDF). (Mercer Human Resource Consulting)
Employers Get Safe Harbor for Pension Transfers to IRAs Under Final DOL Rule
Excerpt: "Employers taking advantage of a final Labor Department rule would be shielded from fiduciary liability when they transfer terminating employees' small pension distributions to individual retirement accounts." (Business Insurance)
Overview: Impact of the SEC's New Mutual Fund Disclosure Rules on ERISA ยง 404(c) Plans
Excerpt: "On August 27th, the SEC finalized new disclosure requirements for mutual funds. These new requirements become effective for mutual fund registration filings after February 28, 2005. Importantly, the new SEC rules will potentially impact fiduciaries of ERISA-covered defined contribution plans that offer investment choices to participants." (Faegre & Benson)
401(k) Stock Suit Proceeds Against Motorola Company and Directors
Excerpt: "An Illinois federal judge has cleared the way for participants in the Motorola 401(k) profit sharing plan to proceed with claims that the company and several directors breached their fiduciary duty in their handling of company stock for the plan.' The U.S. District Court for the Northern District of Illinois ruling is at http://www.ilnd.uscourts.gov/RACERimg/6046198_60.pdf (PLANSPONSOR.com; one-time registration required)
The Role of Company Stock in a Defined Contribution Plan
Excerpt: "Companies may encourage employee ownership through employer-sponsored retirement plans to align the interests of employees with those of shareholders. Special tax incentives also encourage such plan designs. But tax-qualified plans invested in company stock are undergoing increasing scrutiny." (Mercer Human Resource Consulting)
Industry Braces for 401(k) Fee Fallout: Attorneys Anticipate 'A Flood of Lawsuits'
Excerpt: "As employers clamor for more accountability from mutual fund providers, several Portland companies have joined a growing national movement committed to stemming high 401(k) administrative fees." (Business Journal of Portland via bizjournals.com; one-time registration required)
SEC Probe Into 401(k) Plan Fees Embroils DC Plan Sponsors
Excerpt: "Although the dust is still swirling in the Securities and Exchange Commission's probe into mutual fund companies' defined contribution plan payment practices, industry observers are predicting major changes for DC plans and their sponsors." (Employee Benefit News)
Annuities Can Load 401(k) Plans with Fees
Excerpt: "A whopping 35% of your profits may be going to cover plan fees, which often include annuities you didn't know you had. Here's how to find out what you're really being charged." (MSN Money)
Sen. Fitzgerald Warns PBGC on Possible United Airlines Pension Default Citing Company Use of Funds
Excerpt: "Republican U.S. Sen. Peter Fitzgerald wants the federal agency that insures pension funds to take its time before approving any default by United Airlines." (UPI via The Washington Times)
Capital Market Update: Retirement Plans' Funded Ratio Decline Continues in August (PDF)
4 pages. Excerpt: "The monthly Capital Market Update is designed to support our clients in the ongoing financial management of their U.S. retirement plans. Towers Perrin has been tracking the asset/liability performance of a hypothetical benchmark pension plan since 1990. This report reviews how capital market performance affected pension plans, with a focus on linked asset/liability results." (Towers Perrin)
A Guide to Retirement Plan Research on the Internet
Excerpt: "The Internet can be an amazing tool for retirement plan professionals. It contains a wealth of good data from a wide variety of sources that can help you answer specific questions or provide guidance on a particular issue. .... The purpose of this article is to help you locate what you need quickly and then evaluate the information you found." (Rick Meigs, President, 401khelpcenter.com, and Dave Baker, Founder, Benefitslink.com via Judy Diamond Associates)
Links to Items on Executive Comp, Benefits in General
Same-Sex-Marriage Bay State Ruling Has Benefits Administration Ramifications for Other States
Excerpt: "The advent of state-recognized same-sex marriage in Massachusetts earlier this year creates a number of perplexing questions for employers in neighboring states that may employ Massachusetts residents." (New Hampshire Business Review via Gallagher, Callahan & Gartrell)
Voters in 10 of 11 States Are Seen as Likely to Pass Bans of Same-Sex Marriages
Excerpt: "With the recent passage of two state ballot measures banning same-sex marriage, opinion polls and advocates on both sides of the debate say similar initiatives are likely to be approved in as many as 10 other states in November, leading advocates of such marriages to pour money and manpower into a last stand in Oregon." (The New York Times; one-time registration required)
Opinion: Domestic Partners' Employment-Based Benefits Safe in Georgia Marriage Amendment
Excerpt: "The American Civil Liberties Union and Lambda Legal Foundation are at it again. The two organizations are using legal scare tactics to affect the outcome of the Nov. 2 Georgia ballot question on marriage. A similar lawsuit to the one filed in Georgia was attempted in Missouri, which voted by an overwhelming 71 percent in favor of a constitutional amendment recognizing traditional marriage." (The Atlanta Journal-Constitution; one-time registration required)
Analysis: Companies Trimming Grants of Incentive Stock
Excerpt: "Major corporations have trimmed their grants of incentive stock over the past year, helping to address long-standing investor concerns about the impact of equity-based compensation plans on the level of outstanding shares, according to a Towers Perrin analysis. The study also determined that for most large employers, the amounts of stock set aside for executive incentive plans remain at levels that investors generally consider tolerable." (Towers Perrin)
Overview: Executive Compensation Practices Targeted by Congress in Current Tax Bills
Excerpt: "Congress is seeking to eliminate a variety of bonus, stock-based and nonqualified deferred compensation practices widely used by large employers to reward senior executives and other employees. Final legislation with provisions that could affect your organization may be close at hand." (Towers Perrin)
FASB Responds to Public Input on Option Expensing Proposal
Excerpt: "The Financial Accounting Standards Board (FASB) has made tentative decisions to revise a number of key aspects of its proposal to begin requiring companies to expense stock options and other forms of stock-based compensation." (Towers Perrin)
The Future at Work -- Trends and Implications
Excerpt: "What does the future hold for work in the 21st century? In a new study for the U.S. Department of Labor, RAND researchers Lynn Karoly and Constantijn Panis seek to answer this question. In particular, they examine how three major trends that will shape the future at work in this century -- shifting demographic patterns, the pace of technological change, and the path of economic globalization -- will evolve over the next 10-15 years." (RAND)
Newly Posted Events
14th Annual National Employee Health Benefits Conference & Expo in Tampa at New Renaissance Hotel
in Florida on January 27, 2005
presented by Employers Health Conferences
Newly Posted Press Releases
Standard Insurance Company Introduces Online Retirement Plan Loan and Distribution Approval Service for Plan Sponsors
(Standard Insurance Company)
Newly Posted or Renewed Job Openings
401k Account Executive
for BISYS Retirement Services
in PA
Administrative Support
for 401(k) Advisors
in CA
Career Professionals
for Dynamics Worldwide, Inc.
in NY
Plan Reporting Administrator - PA
for The Vanguard Group
in PA
Benefits Administrator - PA
for The Vanguard Group
in PA
Operations Supervisor (RMU)
for ICMA Retirement Corporation
in DC
Compliance Administrator - PA
for The Vanguard Group
in PA
Institutional Trust Consultant III
for Branch Banking and Trust Company (BB&T)
in SC
Defined Benefits Data Administrator - PA
for The Vanguard Group
in PA
Defined Benefits Data Implementation Administrator - PA
for The Vanguard Group
in PA
Qualified Domestic Relations Order Manager - PA
for The Vanguard Group
in PA
Recordkeeping Services Manager - PA
for The Vanguard Group
in PA
Employee Benefits Specialist
for Goodman & Company
in VA
Investment Specialist Opportunities
for Prudential Financial
in CT
401(k) Support Specialist
for 401(k) Advisors
in CA
401(k) Client Service Representative
for ADP TotalSource
in FL
Retirement Services District Manager (Indianapolis)
for ADP Retirement Services
in IN
Senior Plan Administrator
for American National Insurance Company
in TX
Pension Administrators
for Associated Pension Consultants
in CA
Handy Links:
- View Today's Active Message Threads
- Search BenefitsLink
- Using the Web for Employee Benefits Research
- Employee Benefits Library
Copyright 2004 BenefitsLink.com, Inc.; except that you can reprint this newsletter in full (if you also include this boilerplate part) without obtaining our permission.
Published by:
BenefitsLink.com, Inc.
https://benefitslink.com/about.html
1298 Minnesota Avenue, Suite H
Winter Park FL 32789
(407) 644-4146
Fax: (407) 644-2151
Editor and Publisher: David Rhett Baker, J.D.
Housekeeping: