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November 3, 2005
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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)

Chart: Single-Employer Pension Funding Reforms and Cash Balance Provisions (PDF)
17 pages. Excerpt: "Summary Comparison of Principal Provisions of the Pension Protection Act (H.R. 2830) and the Pension Security and Transparency Act (S. 1783)" (Groom Law Group)

Pension Reform Legislation Update (PDF)
4 pages. Excerpt: "It is possible that the prospect of higher PBGC premiums-- plus indications from key Congressional leaders that they will be reluctant to extend into 2006 the temporary replacement of the 30-year Treasury rate with a corporate rate for funding purposes-- could spur action on comprehensive pension reform later this year." (Groom Law Group)

Overview: IRA Protection with the New Bankrup.tcy Law
Excerpt: "On Oct. 17, 2005, the bankrup.tcy reform law, formally named The Bankrup.tcy Abuse Prevention and Consumer Protection Act of 2005, went into effect. After much debate, the bill was signed into law by President Bush on April 20, 2005. The Supreme Court recently ruled that IRAs receive federal creditor protection in bankrup.tcy proceedings, but the new bankrup.tcy law goes one better." (financial-planning.com)

Mercer's Fourth Edition 2005 Global Retirement Perspective
This edition includes articles on the following issues: The new global defined contribution environment -- what other countries can learn from the Australian experience; Korea: Pension plan accounting; UK: A view for overseas HQs; and Pension News Flash: Assumptions for year-end accounting disclosure. (Mercer Human Resource Consulting; one-time registration required)

Turning Workers Into Savers-- Incentives, Liquidity, and Choice in 401(k) Plan Design (PDF)
42 pages. Excerpt: "This paper analyzes the design of 401(k) plans, including the size and structure of matching contributions, and the impact of matching contributions and other plan design features on employee participation and contribution rates. The paper is jointly authored by Olivia Mitchell and Stella Yang of the Wharton School and the Wharton Pension Research Council, and Stephen Utkus of the Vanguard Center for Retirement Research." (Pension Research Council via The Vanguard Center for Retirement Research)

S&P 500 2004 Pension Status Report of July 18, 2005 (PDF)
Excerpt: "This report presents data on the pension funding status of those companies in the S&P 500 that offer defined benefit plans. The first section contains an overview, summary and 2005 evaluation. The second section is a detailed data appendix containing statistical aggregates and a listing of companies offering DB plans in the S&P 500." (Standard & Poor's via Ryan ALM, Inc.)

Overview: Anti-Cutback Rules for Defined Benefit Plans-- Final and Proposed Regulations (PDF)
4 pages. Excerpt: "The final regulations adopt the proposed regulations issued March 24, 2004, with some revisions, and address the limited circumstances under which a defined benefit plan may be amended to eliminate or reduce early retirement benefits, retirement-type subsidies, or optional forms of benefit." (Employee Benefit Plan Review via Gardner Carton & Douglas LLP)

Proposed Rule Jeopardizes ESOPs at Foreign-Owned Firms
Excerpt: "One of the reasons companies offer employee stock ownership plans is to take advantage of the benefit's tax breaks. Now a proposed Treasury Department rule prohibiting foreign-owned firms' U.S. subsidiaries from claiming tax deductions for dividends paid to American employees who purchase shares under an ESOP could lead multinational companies to end their ESOPs for U.S. subsidiaries, ...." (Employee Benefit News)

Korea Employee Pensions: What Should Be Done Now?
Excerpt: "Korea's new corporate pension law, Employee Retirement Benefit Security Act (ERBSA), takes effect on 1 December 2005. However, some of the specifics on regulatory and tax issues are still outstanding and are expected to be announced very soon, either in late October or November. Many employers are wondering what they need to do in preparation for the new legislation in the absence of complete information." (Watson Wyatt Worldwide)

PSCA's Rebuttal to Time Magazine's 'The Great Retirement Ripoff' Story
Excerpt: "Perhaps you saw the cover story 'The Broken Promise: The Great Retirement Ripoff' in the October 31, 2005 issue of Time magazine. This misleading and inaccurate attack on the employer provided retirement system is presented in the most sensational terms and cannot be allowed to stand uncontested. PSCA has sent [this] letter ... to Time and it is our hope it will be printed." (Profit Sharing/401(k) Council of America)

Findings from the Retirement Confidence Survey of College and University Faculty (PDF)
19 pages. Excerpt: "Survey results indicate that America's higher education faculty are confident in their prospects for a comfortable retirement and, relative to all working Americans, they are doing a good job of preparing for retirement. Among higher education faculty, 35% are very confident in their retirement income prospects and an additional 51% are somewhat confident. Two-thirds (65%) expect employer-sponsored retirement plans to be their largest source of retirement income." (TIAA-CREF Institute)

International Retirement Security Survey (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, as well as health care issues that these workers may face in retirement." (AARP)


Links to Items on Executive Comp, Benefits in General

Managing Stock Option Overhang Levels and Burn Rates
Excerpt: "The high overhang rates are not just a cost for companies; they reduce the amount of shares outstanding to attract new investors. 'When you have overhang in the 40% to 50% level, that is not a compensation plan, that is a going private strategy over time,' said McGurn. 'Right now, investors are happy to see that shareholder transfer number going down.'" (PLANSPONSOR.com: one-time registration required)

Second Age Discrimination Class Action Lawsuit Brought Against 3M Company
Excerpt: "The lawsuit was brought under New Jersey's Law Against Discrimination, and charges of discrimination were filed with the federal Equal Employment Opportunity Commission (EEOC), according to a press release from the employees' attorneys at Sprenger & Lang." (PLANSPONSOR.com: one-time registration required)

Text of Rev. Proc. 2005-70: Various Inflation-Adjusted Internal Revenue Code Limits for 2006 (PDF)
19 pages; includes figures for the qualified transportation fringe benefit, adoption assistance programs, medical savings accounts and health savings accounts. (Internal Revenue Service)

Overview: 2006 Benefit Limits
Excerpt: "These adjustments are effective for the plan year that begins on or after January 1, 2006. Some of these increases in limitations result from the enactment of the Economic Growth and Tax Relief Reconciliation Act of 2001 ('EGTRRA'). Other increases reflect cost-of-living adjustments." (Kilpatrick Stockton LLP)

Trucker Huss Benefits Report, October 2005 (PDF)
6 pages. This edition covers two issues: Impact of Code Section 409A and the Newly Proposed Regulations on Equity Compensation Arrangements andPension Plan Limitations for 2006. (Trucker Huss)

Section 409A Can Really Hurt -- Do You Have Clients at Risk from Penalties on Deferred Comp Plans?
Excerpt: "Let's begin with a word of caution: The IRS is still clarifying these rules, so it's important to stay abreast of current regulations. For now, here is the basic information you need to know: What is a nonqualified deferred compensation plan? This is any agreement including plans called NQDC plans, supplemental executive retirement plans (SERPs), 457(f) plans, and all other arrangements under which an employee (or individual contractor) earns compensation for services performed ...." (Financial Advisor)

Overview: Tax Reform Panel's Recommendations (PDF)
2 pages. Excerpt: "Earlier this year, President Bush appointed members to the President's Advisory Panel on Federal Tax Reform, which he tasked with analyzing the current tax system and making recommendations for reform in a revenue neutral manner. The panel presented its recommendations to Treasury Secretary Snow today." (Groom Law Group)

Benefit Advisers Look to New Technology to Educate Executives
Excerpt: "At least two companies have launched podcasts to inform executives of ways to save money and educate employees. The Burchfield Group, a pharmacy benefit consulting firm based in St. Paul, Minn., is offering a podcast series, available for free as individual downloads or as a free online subscription at http://www.burchfieldgroup.com/, designed to help executives with approaches to reducing corporate spending on pharmacy benefits." (The Adviser)

Overview: IRS Relief for Employee Benefit Plans and Participants Affected by Hurricane Katrina (PDF)
2 pages. Excerpt: "A plan participant, beneficiary, qualified beneficiary, or claimant is 'affected by Hurricane Katrina' if he or she resided, lived, or worked in one of the disaster areas at the time of Hurricane Katrina, or if the employee benefit plan providing the individual's coverage was directly affected." (Employee Benefit Plan Review via Gardner Carton & Douglas LLP)


Newly Posted Press Releases

Life Insurance Industry Responds To Advisory Panel's Federal Tax Reform Options
(American Council of Life Insurers)

CPI Adds to Spanish Materials with the Introduction of a Spanish Web Site
(CPI Qualified Plan Consultants, Inc.)

California School Employees Association Selects Healthyroads to Administer Voluntary Weight Loss Program
(American Specialty Health (ASH))


Newly Posted or Renewed Job Openings
Post a Help Wanted Ad

Plan Support Representative - Institutional Plan Services
for Great-West Financial Services
in CO

Project Manager
for Computer Horizons Corporation
in ANY STATE

Pension Benefits Assistant
for Writers Guild Pension Plan
in CA

Traditional Plan Administrator - Benefit Services
for Larson Allen
in MN

Defined Benefit Team Leader
for Mercer HR Services
in MA, RI




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