BenefitsLink
Retirement Plans
Newsletter
To BenefitsLink home page Fill your job openings fast by advertising on BenefitsLink

August 30, 2005
Today's sponsor: ASPPA-- Working for America's Retirement (tm)

(Click on company name or banner to learn more.)
Banner ad for ASPPA-- Working for America's Retirement (tm)

2005 ASPPA Annual Conference * Nov 6 - 9 * Washington, DC

Each year, there are new regulations and legislation, new products and services and new opportunities to increase your knowledge and enhance your business. Take part in this learning opportunity with more than 1,500 of your professional colleagues

ASPPA. For the Serious Retirement Plan Professional.


(Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor)

The Options for Saving Money for Retirement Are About to Grow with Roth 401(k) Plans
Excerpt: "Starting Jan. 1, employers will be allowed to offer a new type of 401(k) that turns things around by letting you give up that immediate income tax break in exchange for tax-free withdrawals of deposits and investment income, generally speaking after age 59 1/2 and in retirement. So the entire $70,000 of salary in the above example would be taxable, even when you're contributing to a 401(k), which some savers could find a turnoff." (The Boston Globe)

Forgotten 401(k)s: Workers Leave Trillions of Dollars in the Hands of Their Old Employers
Excerpt: "According to the Department of Labor, Americans move to a new employer once every four years, leaving a trail of old 401(k) and 403(b) plans that total in the trillions of dollars. Studies show that by 2006, consumers will take the management of more than $2 trillion into their own hands. They'll funnel it into individual retirement accounts (IRAs), completing the process that the financial services industry has dubbed the 'rollover.'" (The Motley Fool via MSNBC.com)

3rd Circuit Court Rules Employees May Sue under ERISA When Company's Stock Crashes
Excerpt: "A federal appeals court has ruled that participants can sue when their company's alleged fiduciary violations harm only those who chose the stock option. The Aug. 19 ruling by the 3rd U.S. Circuit Court of Appeals opens the door for a potential class of 11,000 current and former Schering-Plough workers to sue the Kenilworth drug maker, former CEO Robert Kogan, other fiduciaries and the Vanguard Group, the 401(k) plan's trustee, over losses estimated at $138 million." (New Jersey Law Journal via Law.com)

The Other Side of the 403(b) Story -- A Rebuttal to an August 25, 2005, Wall Street Journal Article (PDF)
4 pages. Excerpt: "[This] rebuttal to an article appearing in the Wall Street Journal on Thursday, August 25th was submitted to the editor on Friday." (The National Tax Sheltered Accounts Association via 403bwise.com)

Calls Growing for Pension Reform in California Counties
Excerpt: "The California State Association of Counties, a lobbying group that represents all 58 counties in the state, is recommending a series of reforms, including capping retirement benefits for new hires, reducing the benefits levels and raising the eligible retirement age. No action was taken this year by lawmakers, but the proposals are expected to be considered in the 2006 legislative session." (Marin Independent Journal)

The Future of Pension Funding and Disclosure -- Oct. 12, 2005, Webcast: Envisioning a Better System
Excerpt: "In July 2005, the SOA presented a Symposium on the topic of Pension Fund reform. .... For those who could not travel to the seminar, the SOA has decided [to summarize] the symposium and offer this webcast. The two moderators for the session Ian Genno and Tom Lowman will summarize the symposium presentations and present the opinions and creative ideas presented at the symposium." (Society of Actuaries)

Ruling Advances San Diego Public Pension Underfunding Case
Excerpt: "A judge denied a request Monday to dismiss conflict-of-interest charges against six current and former pension board members accused of voting to continue underfunding the city of San Diego's system while increasing their own retirement benefits." (The San Diego Union-Tribune)

US Airways Reaches a Deal with PBGC Over Terminated Pensions
Excerpt: "The US Airways Group has reached a deal with the Pension Benefit Guaranty Corporation to resolve nearly $2.7 billion in claims in the bankrup.tcy case and to ensure the agency's support for the airline's reorganization plan." (The New York Times; one-time registration required)

Opinion: Bring Wisconsin Public Pensions in Line with Other States
Excerpt: "Nationally, state and local employees contribute an average of 38.4% of the cost of their pensions. In Wisconsin, the level of employee contribution is 2.6%. Our public servants are getting a Mercedes for Subaru payments." (Milwaukee Journal Sentinel)

Text of the IRS LRM #25B on Cross-Tested Profit-Sharing Plans (PDF)
5 pages. Excerpt: "Employer contributions for a plan year will be allocated to each employee of the employer who is employed as of the last day of the plan year. The general nondiscrimination test under section 1.401(a)(4)-2(c)(1) must be satisfied using equivalent accrual rates (within the meaning of 1.401(a)(4)-8(b)(2)) that are substituted for each employee's allocation rate in the determination of rate groups. The allocation rate for any employee is equal to the sum of employer ...." (U.S. Internal Revenue Service)

Overview: IRS Releases Final 412(i) Valuation Regulations
Excerpt: "The Internal Revenue Service has completed regulations that are supposed to keep employers and insurers from playing games with the values of life insurance contracts used in employee compensation arrangements." (National Underwriter Life & Health; free one-time registration or paid subscription required)

Text: Report of the 5th Annual European EOLE Programme (PDF)
33 pages. Excerpt: "[T]he conference promoted employee share ownership to the political, economic and social world. The 2005-meeting allowed representatives form the US, from Europe and other regions of the world to see how deep their common views are." (European Federation of Employee Share Ownership (EFES))

Appeal Court Rules Against Des Moines School District Early Retirement Plan
Excerpt: "A federal appeals court has ruled that an early retirement plan offered by the Des Moines school district discriminates against older workers. The district's plan offered teachers a lump sum payment based on unused sick leave. But it applied only to workers from the ages of 55 to 65." (WorldNow and WHO-TV)

You Can Have a Nice Retirement Nest Egg without Fear of the Tax Man
Excerpt: "['W]ould it be better to invest my future savings in after-tax Roth IRA accounts, so I have some savings that will not be taxed when I need them?' The answer: This is a real concern -- but it isn't universal. Most people will avoid any problems because the standard deduction and personal exemptions are indexed to inflation. Only a small number of households accumulate so much in tax-deferred accounts that their annual withdrawals will exceed their basic tax deductions." (Universal Press Syndicate via Houston Chronicle)

MetLife Suggests Shift in Educational Focus from Retirement Assets to Retirement Income
Excerpt: "For far too long, the national debate about retirement planning has focused on assets instead of income. But MetLife has set out to shift the course of this thinking as part of a campaign to promote a new generation of income annuities and the importance of lifelong guaranteed income at a time when growing life expectancy means future retirees cannot afford to outlive their assets." (Employee Benefit News)


Links to Items on Executive Comp, Benefits in General

Overview: Third Circuit Court Decision Favorably Cites Dissent in Milofsky v. American Airlines
Excerpt: "The Third Circuit Court of Appeals in In re Schering-Plough Corporation ERISA Litigation has ruled in favor of a limited subset of ERISA plan participants in their appeal from a Motion to Dismiss. The Third Circuit has held that a subgroup of plan participants may file a derivative action on behalf of an ERISA employee benefits plan under ERISA §502(a)(2) (29 USC §1132(a)(2)) for an alleged breach of fiduciary duty." (The ERISA Industry Committee)

Third Circuit Permits Fiduciary Breach Suit Even Though Only Subset of Plan Participants Affected
Excerpt: "As noted in the opinion, the Sixth and Eighth Circuits also have ruled that a subset of participants can sue an ERISA plan for breach of fiduciary duty under ERISA Section 502(a)(2). And as the court points out in a footnote, the Fifth Circuit has granted a rehearing in the Milofsky case, effectively vacating that opinion." (Employee Benefits Institute of America Inc.)

Text of DOL Proposed Regs Requiring Electronic Filing of Form 5500 for 2007 Plan Year (PDF)
13 pages. Excerpt: "[I]mprovements and cost savings in the filing processes can best be achieved by adopting a wholly electronic filing processing system and eliminating the currently accepted paper filings. The Department believes that a wholly electronic system will result in ... reduced filer errors ...; more timely data for public disclosure and enforcement ...; and lower annual report processing costs, benefiting taxpayers generally." (Employee Benefits Security Administration, U.S. Department of Labor)

Governments Have the Most Generous Employee Benefit Packages
Excerpt: "A news release from Mercer Human Resource Consulting said that in terms of overall benefits provided to employees, including health care coverage and retirement benefits, government employers offer the highest level of total benefits at 126% of the market median." (PLANSPONSOR.com: one-time registration required)


Newly Posted Events

e-Health Promotion with WebMD: Navigating the Future of Health Care
Nationwide on September 20, 2005
presented by Precept Human Capital Management

ERISA Workshop
in Oregon on October 21, 2005
presented by SunGard Corbel

Legislative Update: Are You In Compliance?
in Georgia on September 15, 2005
presented by Worldwide Employee Benefits Network (WEB) - Atlanta Chapter

Quarterly Meeting
in Montana on September 14, 2005
presented by Western Pension & Benefits Conference - Montana Chapter


Newly Posted Press Releases

Newkirk Introduces Comprehensive Roth 401(k) Communications Services To Educate Providers' Administrative Staff, Sponsors, and Participants
(Newkirk)

Employee Benefits that Work: The Principal Financial Group Rolls Out Revolutionary New Worksite Voluntary Benefit Program
(Principal Financial Group)

United Benefit Advisors (UBA) Announces Results of the Largest National Health Plan Benchmark Survey Ever Conducted
(United Benefit Advisors)

New Employee Wellness Benefit: The "Managing My Life" Online Library Series
(Planning For Life)

Labor Department Proposes Electronic Filing of Form 5500 Annual Reports
(U.S. Department of Labor, Employee Benefits Security Administration)

CalSTRS "Walks the Walk" on Climate Change: Will Disclose Its Own Greenhouse Gas Emissions
(California State Teachers' Retirement System (CalSTRS))


Newly Posted or Renewed Job Openings
Post a Help Wanted Ad

Life & Health Sales Representative
for Great-West Healthcare
in IL, MI, NJ, OH

Benefit Analyst
for Edward Hospital
in IL

HGB Benefits Operations Manager
for Hewitt Associates
in FL

Retirement Plan Consultant
for Invesmart, Inc.
in OH

Relationship Manager / Account Coordinator
for T. Rowe Price
in DC, MD

Retirement Plan Sales Consultant
for Invesmart, Inc.
in CA, CO, IL, MN, MO, TX




Handy Links:

Copyright 2005 BenefitsLink.com, Inc.; except that you may reprint this newsletter in full (including this sentence) 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: