| BenefitsLink Retirement Plans Newsletter |   |
October 19, 2005
Today's sponsor: DATAIR Employee Benefit Systems, Inc.
(Click on company name or banner to learn more.)
| Software for DC/401(k) Plan Administration |
| DATAIR's IMPROVED BENEFIT ADMINISTRATION SOFTWARE for 401(k), Profit Sharing and all other Defined Contribution plans. Designed for administrators and consultants.
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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) |
Employers Balk at Senate Pension Reform Plan
Excerpt: "In early October, pension reform was hurtling toward a vote in the Senate after two committees melded their bills into one bipartisan piece of legislation. But businesses halted the process to battle proposed increases in pension plan payments for financially ailing companies. They also object to limiting so-called smoothing of pension assets and liabilities, saying that it would increase funding volatility." (Workforce Management; one-time registration required)
ABC Letter to Full Senate Regarding The Pension Security and Transparency Act, S. 1783 (PDF)
3 pages. Excerpt: "The American Benefits Council (Council), representing companies that either directly sponsor or provide services to retirement and health plans covering more than 100million Americans, believes that it is critical that pension reform legislation be enacted this year to protect the U.S. pension system and the millions of Americans who rely upon that system for their retirement income security." (American Benefits Council)
Letter to the Editor of The Washington Post: On Pension Reform, First Do No Harm
Excerpt: "The Post exaggerates problems with defined-benefit pension plans that employers provide voluntarily for 44 million American retirees and workers ['Government's Disgrace,' editorial, Oct.17]. Of the more than 31,000 such plans, 42 percent are better than 100 percent-funded and only 15 percent are funded at less than 70 percent." (The Washington Post; one-time registration required)
ABC Letter to Senate HELP Committee Regarding PBGC Premiums and Budget Reconciliation (PDF)
2 pages. Excerpt: "If the HELP Committee absolutely believes that premiums need to be addressed as part of the budget reconciliation process, then we would further urge you to support Senator Jeff Bingaman's efforts to institute the standard per participant premium level that the HELP Committee approved on September 8, 2005." (American Benefits Council)
Senate Measure Would Hike PBGC Premiums
Excerpt: "Legislation approved Tuesday by the Senate Health, Education, Labor and Pensions Committee would more than double the premiums that employers with defined benefit pension plans pay to the Pension Benefit Guaranty Corp. The measure, to be incorporated into a broader budget bill, would increase the annual PBGC premium to $46.75 per participant from the current $19 level, and would index future increases to wage inflation." (Business Insurance)
The Roth 401(k)/403(b): What Plan Sponsors Need to Consider
Excerpt: "[C]onsidering the opportunity to invest in taxable investments within a tax-free environment, the Roth option is a no-brainer for any participant interested in maximizing retirement benefits or any HCE whose contributions are limited by the 'test.'" (ERISA Expertise LLC)
Going for the Gold with 401(k) Plans -- That Is a Plan with Minimal Expenses
Excerpt: "(Employers take note: You can do more for your employees with a low-expense plan than you can with a high match. Employees take note: If your employer is indifferent to plan expenses but generous with the match, you should look for a smarter employer.)" (The Dallas Morning News; one-time registration required)
401(k) Plan Participant Filed Too Late to Pursue an ERISA Fiduciary Breach Claim
Excerpt: "In holding plaintiff Andrew Reeves to ERISA's 36-month statute of limitations for fiduciary breach claims, US District Judge Laurie Smith Camp of the US District Court for the District of Nebraska rejected Reeves' argument that he shouldn't be held to the time limit because he hadn't read his K plan mail, BNA reported. Camp dismissed the case." (PLANSPONSOR.com: one-time registration required)
Cash Balance Pension Plans and Older Workers (PDF)
Excerpt: "This Issue Brief discusses issues related to cash balance plan design in the context of both traditional defined benefit (DB) pension plans and 401(k) plans -- the most prevalent type of defined contribution (DC) pension plan." (AARP)
Delphi CEO Says Traditional Pensions Are Anachronisms that Corporations Must Fix in Order to Survive
Excerpt: "[T]he fundamental problem is the whole concept of a defined benefit program. It has been exacerbated by our aging population. Defined benefit was created in an era when people worked till 65 and died at 70. There were so many active workers compared to the number of people on retirement that it was just not an issue. But that has reversed." (Time Online Edition)
San Diego City Council Rejects Plan to Settle Pension Suit
Excerpt: "The San Diego City Council rejected a settlement proposal yesterday that could have ended a lawsuit calling for the city to catch up on 10 years of debt to its pension system. Don McGrath, an executive assistant city attorney, said the council refused to accept the initial offer to transfer an estimated $150 million worth of land to the pension fund but allowed him to begin negotiations." (The San Diego Union-Tribune)
Overview: IRS Grants Tax Favored Treatment for Early Distribution of Retirement Funds
Excerpt: "The IRS is drafting Form 8915, Qualified Hurricane Katrina Retirement Plan Distributions and Repayments, which will be used by taxpayers to report distributions and determine the amount included in income. The IRS is also in the process of issuing guidance on the tax favored treatment distributions from retirement plans as they apply to taxpayers affected by Hurricane Katrina." (AccountingWeb)
Overview: KETRA Provides Additional Relief for Hurricane Katrina Victims (PDF)
8 pages. Excerpt: "This relief is available to sponsors of qualified plans, ERISA 403(b) plans, and governmental section 457 plans whose participants were directly affected by Hurricane Katrina. It is also available to affected participants in non-ERISA 403(b) programs." (Prudential Retirement)
New Orleans Pension Officials Pull Together to Keep Payments Coming to Retirees
Excerpt: "One week after Hurricane Katrina slammed into the Gulf Coast, the New Orleans Employees' Retirement System was struggling to locate the trustees of the funds. Chairman of the fund Jerry Davis said that, although he had located most of the trustees, he was still looking for the director of Finance. [A] serious priority for Davis was getting the September pension checks out to retirees of the system." (PLANSPONSOR.com: one-time registration required)
Special Report: Post-Retirement and Rollovers and the Annuity Option
Excerpt: "Should employers and their pension providers play a role in helping participants manage their nest eggs after retirement? For plan sponsors who have spent the past couple of decades helping employees save for retirement, the notion that they should now expend a comparable effort helping them consume their nest egg can be daunting -- and a challenge not all are ready to accept." (PLANSPONSOR.com: one-time registration required)
The Limitations of 404 (c) Protection
Excerpt: "[B]ased on my experience and on conversations with others in the industry, few plans actually comply with the conditions in the 404(c) regulations. As a result, most plan decisionmakers, including committee members, are legally responsible for the prudence of participant investment decisions." (PLANSPONSOR.com: one-time registration required)
Consultant Relationships with Pension Boards Are Drawing Regulatory Attention
Excerpt: "While that SEC report was predicated on a sampling of just 24 firms ..., public pension plan boards have since been excoriated for lax oversight and tolerating personal relationships that create conflicts of interest while, on the private and Taft-Hartley side, the Department of Labor has been criticized for an inability to comprehend and regulate these problems." (PLANSPONSOR.com: one-time registration required)
Pension Funds in WorldCom Settlement
Excerpt: "New York City's five public-employee pension funds said yesterday that they had reached a $78.9 million fraud settlement against a group of banks and other defendants stemming from the collapse of WorldCom." (The New York Times; one-time registration required)
Report: Transition Provisions in Large Converted Cash Balance Pension Plans (PDF)
29 pages. Excerpt: "This report by Daniel J. Beller investigates the effects on older workers of conversions of traditional DB plans to cash balance plans. This study, which was funded under a contract from AARP,used the Annual Form 5500 reports filed with the Department of Labor for 2003 plan years to determine the extent to which large DB plans that have converted to cash balance plans also included transition amendments." (AARP)
10 Tips from the 10 Best Employers for Retirement Security
Excerpt: "There is no cookie-cutter path to offering a prize-winning benefits package. Each of the honorees [in The Principal 10 Best Companies for Employee Financial Security program] has different circumstances and has taken an individualized approach to maintaining strong benefits. However, interviews with executives at each of the organizations reveal some commonalities." (PLANSPONSOR.com: one-time registration required)
Links to Items on Executive Comp, Benefits in General
Practical Accommodation to the Application of Grant Date as Defined in FASB Statement No. 123(R) (PDF)
2 pages. Excerpt: "This FSP is in response to recent inquiries from constituents to provide guidance on the application of grant date as defined in FASB Statement No. 123 (revised 2004), Share-Based Payment." (Financial Accounting Standards Board)
Working Paper: Why Not Retire? The Time and Timing Costs of Market Work (PDF)
43 pages. Excerpt: "Retirement ages among older Americans have only recently begun to increase after their precipitous fifty-year decline. Early retirement may result from incentives provided by retirement systems; but it may also result from the rigidities imposed by market work schedules." (University of Michigan Retirement Research Center)
Palm Beach County to Offer G.ay Partner Benefits
Excerpt: "The Palm Beach County Board of County Commissioners voted unanimously Tuesday to offer the same employee benefits to its current and retired employees with domestic partners as it offers to married employees and retirees. The move makes the county one of only a handful of municipalities in Florida to offer domestic partner benefits to its workers." (365G.ay.com)
Overview: Proposed Section 409A Regs Provide Increased Flexibility for Nonqualified Deferred Comp (PDF)
11 pages. Excerpt: "Generally, the proposed regulations provide service recipients (i.e., plan sponsors) with a welcomed degree of flexibility in designing deferred compensation plans and arrangements that will comply with Section 409A; although several traps for the unwary do remain." (Pillsbury Winthrop Shaw Pittman LLP)
Overview: Proposed Regulations Clarify Application of Section 409A to Foreign Benefit Arrangements (PDF)
5 pages. Excerpt: "The proposed regulations clarify, among other things, that certain non U.S. plans and arrangements and certain arrangements with non-U.S. residents are excluded from Section 409A's scope. The proposed regulations also set forth conditions for the exclusion of which stock options and stock appreciation rights to foreign stock." (Pillsbury Winthrop Shaw Pittman LLP)
Overview: Stock Compensation Provisions in Proposed Regulations under Section 409A (PDF)
5 pages. (Pillsbury Winthrop Shaw Pittman LLP)
CalPERS Board Opposes Payments to PacifiCare Executives
Excerpt: "The fund is the first institutional investor to weigh in on a proposed sale to UnitedHealth. Directors of California's giant public pension fund voted Monday to oppose $345 million in payments that top executives of PacifiCare Health Systems Inc. would reap from the sale of the health insurer to UnitedHealth Group Inc." (Los Angeles Times; one-time registration required)
How Good Is the Economy at Creating 'Good' Jobs? (PDF)
17 pages. Excerpt: "The report defines a 'good' job as one that offers decent pay (at least $16 per hour or about $32,000 per year), employer-paid health insurance, and a pension. In 2004 (the most recent year for which data are available), only 25.2 percent of American workers had a job that met all three criteria." (Center for Economic and Policy Research)
Newly Posted Events
Advisory Council on Employee Welfare and Pension Benefit Plans; Retirement Plan Distributions and Options; Communications to Retirement Plan Participants and Improving Plan Communications for Health and Welfare Plan Participants; Notice of Meeting
in District of Columbia on November 2, 2005
presented by U.S. Department of Labor, Employee Benefits Security Administration
Code Section 409A
in North Carolina on November 16, 2005
presented by SunGard Corbel
Code Section 409A
in Georgia on November 17, 2005
presented by SunGard Corbel
Code Section 409A
in Texas on November 17, 2005
presented by SunGard Corbel
Code Section 409A
in Texas on November 18, 2005
presented by SunGard Corbel
Distributions and Taxation Workshop
Nationwide on December 6, 2005
presented by SunGard Corbel
Employee Benefits Security Administration 132nd Plenary Meeting; Advisory Council on Employee Welfare and Pension Benefit Plans; Notice of Meeting
in District of Columbia on November 3, 2005
presented by U.S. Department of Labor, Employee Benefits Security Administration
Estate Planning Considerations for Qualified Plans and IRAs
in North Carolina on November 15, 2005
presented by SunGard Corbel
Estate Planning Considerations for Qualified Plans and IRAs
in Georgia on November 16, 2005
presented by SunGard Corbel
Estate Planning Considerations for Qualified Plans and IRAs
in Texas on November 17, 2005
presented by SunGard Corbel
Ready for Roth?
Nationwide on December 6, 2005
presented by SunGard Corbel
Retirement Plans: What Every Employer Must Know
in Kansas on November 16, 2005
presented by SunGard Corbel
Retirement Plans: What Every Employer Must Know
in Illinois on November 17, 2005
presented by SunGard Corbel
Newly Posted Press Releases
Two Letters, One Issue: Pension Reform - Council Urges HELP Panel To Reject Extreme PBGC Premiums; Encourages Full Senate To Continue Work On Pension Reform
(American Benefits Council)
Great-West Healthcare First Employee Benefit Provider to Offer Payroll Deduction Credit Card Solution
(Great-West Life & Annuity Insurance Company)
Bidwell Consulting Services, Inc. Adds Experienced Pension Professional
(Bidwell Consulting Services, Inc.)
Newly Posted or Renewed Job Openings
Benefits Project Manager
for Publix Super Markets, Inc.
in FL
Pension Administrator
for Long Island Pension Consulting Firm
in NY
Retirement Services Specialist
for Administaff
in TX
Sr. Account Manager
for CitiStreet
in NJ
Retirement Plan Consulting Supervisor
for Kibble & Prentice
in WA
Retirement Plan Analyst/TPA
for Fifty year old firm specializing in the healthcare industry
in NC
Junior Pension Plan Administrator
for Robin S. Weingast & Associates, Inc.
in NY
Benefit Implementation Specialists - TJBIS1018
for The Rosen Group
in CA, CT, MA, ME, NC, NJ, NY, PA, RI, SC, TN, TX, VA, WV
Manager 401(K) Recordkeeping
for NRECA
in VA
Manager, Benefits Compliance
for NRECA
in VA
Participant Education Consultant
for The Vanguard Group
in PA
Handy Links:
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- Search BenefitsLink
- Using the Web for Employee Benefits Research (hypertext article)
- Employee Benefits Library
Copyright 2005 BenefitsLink.com, Inc.; except that you may reprint this newsletter in full (including this sentence) without obtaining our permission.
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