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July 20, 2005
Today's sponsor: Penchecks, Inc.

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The National Registry has arrived!

It is a web-based service designed to reunite plan participants with their unclaimed retirement benefits. Since going live on May 27, 2005, over 10,000 participant names with unclaimed pension benefits have already been registered. Plan Administrators and IRA custodians may register their missing participants in the National Registry's database for a nominal fee. Participants are able to check the database online. If a match is found, contact information is provided. There is no charge to individual participants to use the service to search for unclaimed retirement benefits that are owed to them. The National Registry facilitates Win-Win situations - Plan Sponsors alleviate themselves of reporting burden and fiduciary responsibility when lost participants claim their money and Former Plan Participants end up with more money!

All Automatic/Default/Missing Participant IRAs established through PenChecks, Inc. are automatically included in the National Registry database at no additional cost.

For more information, click on the link above or call (877) 462-2745.


(Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor)
Northwest Airlines Moves Salaried Employees from Defined Benefit Plan
Excerpt: "Northwest Airlines is freezing its pension plan covering 3,300 salaried employees in an effort to control benefit costs. The freeze takes effect Aug. 31. Employees still will receive pension benefits they earned up to this year, but those benefits will not increase. Northwest will implement a defined contribution plan for salaried employees instead." (BenefitNews Connect)

Testimony Before ERISA Advisory Council Working Group on Retirement Plan Distributions and Options (PDF)
5 pages. The target page is the testimony by David L. Wray, President, on communication, distribution options, and phased retirement issues. (Profit Sharing / 401k Council of America)

Ways and Means Committee Looks at Cementing 401(k) Contribution Boosts
Excerpt: "Budget legislation now being assembled in the House Ways and Means Committee is likely to make permanent provisions in a 2001 tax law that temporarily boosted contributions that can be made to 401(k) plans, a committee member says." (Business Insurance)

Can too Much Still Not Be Enough Diversity in 401(k) Plans?
Excerpt: "Most 401(k) plans lack the investment choices that participants need to create an adequately diversified portfolio, a study claims. 'The Adequacy of Investment Choices Offered by 401(k) Plans,' which analyzed 417 401(k) plans, was written by two New York University (NYU) finance professors and a Fordham University finance professor." (PLANSPONSOR.com; one-time registration required)

Hewlett Packard Co. Is Phasing Out Defined Benefit Plan; Will Boost 401(k) Match
Excerpt: "Hewlett Packard Co. is phasing out its defined benefit pension plan, as the exodus of big employers from the plans continues. Except for long-serving employees close to retirement, Hewlett Packard will stop accruals in its $3.2 billion plan effective Jan. 1, 2006." (Business Insurance)

Overview: SEC Staff Report Provides Renewed Pressure to Reexamine Retirement Plan Accounting
Excerpt: "Employers are under mounting pressure to move toward a more market-based accounting system to reflect the financial performance of their defined benefit pension and other postretirement benefit plans. The latest push for change came in a Securities and Exchange Commission (SEC) study, required by the Sarbanes-Oxley Act, on off-balance-sheet arrangements and the transparency of current financial statements." (Towers Perrin)

Many Companies Struggle with Pension Costs
Excerpt: "When Hewlett-Packard Co. announced Tuesday that its massive restructuring would include an overhaul of its retirement plans, the technology giant joined a long line of companies trying to cut costly pension obligations that originated in another era. The traditional 'defined-benefit' pension plan, in which a company invests a pool of money that is used to dole out checks to retired employees based on their final salaries, long has been waning." (AP via Forbes.com)

Pension Funding Holding Steady, According to S&P Study
Excerpt: "'The major factor affecting pension underfunding in 2005 will be interest rates, and we expect them to increase, but not sufficiently enough to alleviate the funding shortage,' according to Standard & Poor's. Defined-benefit pension plans sponsored by Standard & Poor's 500 companies were, on average, no better or worse off at the end of 2004 than they were a year earlier, according to a new study by S&P." (CFO.com)

Retiree Runaround: Challenging a Pension Benefits Decision -- Not for the Faint of Heart
Excerpt: "Fred Loewy ... delayed his retirement at Motorola Inc. till he was almost 73. Not only would the delay mean bigger Social Security checks someday, he figured, but he'd earn a bigger pension from his employer too. But when his company pension didn't turn out to be as large as he expected, Mr. Loewy learned a fact of retiree life he hadn't reckoned on: the complexity, sometimes exasperating, of trying to appeal a benefits calculation." (The Wall Street Journal via Pittsburgh Post-Gazette)

EDS ERISA Litigation Update and Comments
Excerpt: "As reported on The ERISA Blog, the District Court for the Eastern District of Texas rejected a proposed settlement in the EDS litigation because it was not in the best in interest of the class members. Under the proposed settlement, the class members would only receive two or three cents on the dollar of their losses. So the court concluded that a reasonable class member would rather risk litigation rather than accept such a discounted settlement." (Michael H. Rosenthal via For Your Benefit Blog)

Staying Organized-- A Fiduciary Checklist for Plan Sponsors (PDF)
2 pages. The target page is a checklist for plan sponsors to use to audit their plan. (Cypress Group, LLC.)

The Fiduciary Responsibility to Be Responsible and the Application of 404(c)
Excerpt: "As ... pointed out in previous columns, 401(k) investment fiduciaries are legally responsible for the prudence of participant investment decisions, as well as for the suitability of the options. However, the legal responsibility for participant investment decisions can be shifted to the participants if a plan complies with the 20 to 25 404(c) conditions; and if participants actually direct their investments." (PLANSPONSOR.com; one-time registration required)

Arkansas Teacher Pension Needs to Invest in State and Establish Sound Investment Guidelines
Excerpt: "Arkansas Teacher Retirement System trustees are looking for strategic ways to invest more of the system's $8.7 billion in assets within the state, even while continuing to sell off some of the Arkansas-related property it already owns." (Arkansas Democrat Gazette)

New Pension System for West Virginia's Public School Teachers Is Similar to the Old System
Excerpt: "Editor's note: This is part of a series of stories examining West Virginia's public employees pension system. West Virginia public school teachers hired after June 30 will be going into a 'new' state pension program, as a result of a law passed this year by the state Legislature. But the program is very similar to a pension system that was in effect for many years - and which resulted in the state building up unfunded liabilities estimated at $5 billion." (The Intelligencer & Wheeling News Register)

Opinion: It Is Time to Ban Tacking of Public Jobs in New Jersey
Excerpt: "There's no stopping a public employee from putting together part-time jobs to pocket a total salary exceeding the governor's $175,000 a year. Thirty lawyers, tax collectors and tax assessors did just that last year, drawing $6.2 million from 133 jobs. But state taxpayers will be paying for these professionals long after they retire because their annual pensions are based on their collective salaries. The practice is called tacking, and it's something that must be stopped." (Asbury Park Press)

Union Pension Fund Sues Morgan Stanley Over Exit Pay to Executives
Excerpt: "A pension fund on Tuesday sued Morgan Stanley directors, alleging they tolerated 'grotesque mismanagement' by former Chief Executive Philip Purcell and former co-President Stephen Crawford before the men reaped excessive exit payments. The Central Laborers' Pension Fund said in the suit that directors breached their duties to shareholders by approving severance payments of $77.4 million to Purcell and $32 million to Crawford." (Bloomberg News via Chicago Tribune; one-time registration required)

International Retirement Security Survey Covers Workers in Ten Countries (PDF)
116 pages. Excerpt: "AARP commissioned a survey of the general population aged 30-65 in 10 developed nations--Australia, Can.ada, France, Germany, Italy, Japan, the Netherlands, Sweden, the United Kingdom and the United States--regarding their attitudes and behaviors surrounding retirement issues. The survey covered retirement expectations, preparations, and public policy options, .... [The 20-page executive summary is at http://assets.aarp.org/rgcenter/general/irss_1.pdf.]" (AARP)

Towers Perrin U.S. Legislative Tracking Charts-- Retirement-- Updated July 18, 2005 (PDF)
7 pages. Excerpt: "These charts summarize selected federal legislation that would affect employee benefit programs. The bills included on the charts are based on judgments regarding the prominence of the issue, the likelihood of enactment, and the influence of the sponsors." (Towers Perrin)

Links to Items on Executive Comp, Benefits in General

The 2005 Deloitte Stock Compensation Survey -- Options Take a Hit, but What Will Take Their Place? (PDF)
11 pages. Excerpt: "The 2005 Deloitte Stock Compensation Survey addressed future equity compensation practices and implementation issues as it relates to the adoption of the Financial Accounting Standards Board's (FASB) newly revised accounting standard for stock-based compensation,FAS 123(R)." (Deloitte)

Accounting Rules Prompt Stock Options Cuts
Excerpt: " New expensing rules have caused 75% of companies to reduce stock options given to employees, according to Deloitte's 2005 compensation survey ...." (BenefitNews Connect)

Towers Perrin U.S. Legislative Tracking Charts-- Human Resources-- Updated July 18, 2005 (PDF)
5 pages. Excerpt: "These charts summarize selected federal legislation that would affect employee benefit programs. The bills included on the charts are based on judgments regarding the prominence of the issue, the likelihood of enactment, and the influence of the sponsors." (Towers Perrin)

New Equity Incentive Programs Gain Favor with Employers Around the World
Excerpt: "[W]ith the introduction of mandatory expensing of options by the Financial Accounting Standards Board and the International Accounting Standards Board, companies are exploring alternative incentives because the new rules remove the more advantageous accounting treatment for options and place all forms of long-term incentives (LTIs) on a level playing field. [C]ompanies are showing more interest in restricted stock and performance shares, ...." (Towers Perrin)

Newly Posted Events

Employee Benefit Plan Best Practices
Nationwide on August 18, 2005
presented by ERISA Fiduciary Guild & IBF Conferences*International Business Forum

ERISA Workshop
in Tennessee on September 21, 2005
presented by SunGard Corbel

ERISA Workshop
in Texas on September 22, 2005
presented by SunGard Corbel

ERISA Workshop
in Ohio on September 22, 2005
presented by SunGard Corbel

ERISA Workshop
in New York on September 22, 2005
presented by SunGard Corbel

ERISA Workshop
in Michigan on September 23, 2005
presented by SunGard Corbel

ERISA Workshop
in Ohio on September 23, 2005
presented by SunGard Corbel

Third Quarter 2005 Update
Nationwide on August 18, 2005
presented by McKay Hochman Co., Inc.

Third Quarter 2005 Update
Nationwide on August 19, 2005
presented by McKay Hochman Co., Inc.

Newly Posted Press Releases

Larry Goldbrum Joins RG Wuelfing & Associates As EVP, Will Serve As General Counsel For The NDCC/SPARK Institute
(RG Wuelfing & Associates)

MCOL's Healthquest Publishers' 2005 Consumer Driven Care Guidebook Second Edition Now Includes Detailed Directory Of Consumer Driven Care Organizations
(MCOL)

Federal Retirement Thrift Investment Board Announces Roll-out of Lifecycle Funds
(Federal Retirement Thrift Investment Board)

HRmarketer.com Reports 36 Consecutive Months of Sales Growth. Company also Expands Marketing and Media Resources to Help HR Suppliers Target Niche Industry Markets
(HRmarketer.com)

Newly Posted or Renewed Job Openings
Post a Help Wanted Ad

Human Resources Officer (Benefits)
for Administrative Office of the U.S. Courts
in DC

401(k) Plan Consultant
for 401(k) Advisors
in CA

401(k) Relationship Manager
for 401(k) Advisors
in CA

Defined Benefit Conversion Project Manager
for Benetemps
in MA

ERISA Sales Consultant-- Vice President
for American Pensions, Inc.
in FL

Plan Administrator
for Small, Northeast FL Daily Val Shop
in FL



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