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July 10, 2006
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TPA Liable for Breach of Fiduciary Duty in Connection with Plan's Investment Advisor's Embezzlement
Excerpt: "EBIA Comment: As the trial court emphasized, an ERISA fiduciary cannot escape liability for fiduciary breach by maintaining that he or she was simply following the instructions of another fiduciary. Also, the trial court was troubled that the TPA relied on oral instructions from the investment advisor and that he never received written verification that forwarded funds were invested for the benefit of plan participants." (Employee Benefits Institute of America Inc.)

Spitzer Continues Probe of Insurance Retirement Plans
Excerpt: "The investigation into whether insurance companies paid pension plan managers to choose the investment options they offer their participants -- such as mutual funds and annuities -- is expected to lead to lawsuits and settlements within the next few months, a source told Reuters." (PLANSPONSOR.com; one-time registration required)

Overview: Prohibited Transaction Excise Taxes on Late Elective Deferrals
Excerpt: "EBIA Comment: This ruling confirms what, in our experience, is a commonly used method for calculating the prohibited transaction excise tax on late payments of elective deferrals, under which the 'amount involved' is the interest on the deferrals, not their actual dollar amount. Once calculated, the excise tax is forwarded to the IRS with a Form 5330." (Employee Benefits Institute of America Inc.)

FASB July 12 Meeting to Include Pension Accounting Proposal
Excerpt: "The Financial Accounting Standards Board (FASB) has scheduled time during a July 12 meeting to further discuss its proposal that would force companies to account for their pensions and other post-employment benefits on their balance sheets." (PLANSPONSOR.com; one-time registration required)

Credit Ratings Off Table in Pension Bill Negotiations
Excerpt: "Employers may not get everything they want from pension reform legislation being hammered out on Capitol Hill, but they have apparently prevailed on one sticking point -- credit ratings likely will not be used to determine the vulnerability of a pension plan and trigger higher payments." (Workforce Management; one-time registration required)

San Diego County Retirement Panel Rejects Advice on Return Assumption
Excerpt: "The county retirement board has rejected its financial expert's advice to expect lower returns on its investments, a decision that could keep the county from paying an additional $20 million into its retirement fund annually." (SignOnSanDiego.com)

Debt from Public Pensions to Double for Indiana Cities and Towns
Excerpt: "Every unit of local government that hired police or firefighters before 1977 already owes millions of dollars under an old pension plan to their retirees, and the amount they owe will double in less than three years when the state stops paying its share of the expense." (The Journal Gazette via FortWayne.com)

Airlines Pressure Congress over Pension Bill
Excerpt: "Bankrupt U.S. carriers Northwest Airlines and Delta Air Lines have stepped up pressure on Congress to finish pension legislation that would give them more time to fund plans that are billions of dollars in the red and in danger of termination." (Reuters via The New York Times; one-time registration required)

Workers File Pension Suit against Boeing
Excerpt: "Four former McDonnell Douglas employees who moved over to Boeing after a corporate merger between the two firms have filed suit against a Boeing pension plan." (PLANSPONSOR.com; one-time registration required)

Inherited Pensions May Be Taxed Twice
Excerpt: "Proponents [of estate tax repeal] argue assets accumulated during a lifetime have already been taxed and should not be taxed again because of owner's death. The logic of this particular point is best illustrated by the taxation of inherited (non-ROTH) pensions and individual retirement accounts (IRA's)." (Dayton Daily News)

Danes to Raise Retirement Age from 65 to 67
Excerpt: "On 20 June 2006, the Danish parliament adopted a series of reforms to better enable its welfare system to meet the challenges of an aging population." (Watson Wyatt Worldwide)

Hewitt Federal Legislation Quick Guide Updated as of July 5, 2006, for Retirement Plans (PDF)
11 pages. This Federal Legislation Quick Guide provides short updates on federal legislation that is currently under active consideration by Congress or has recently been enacted into law regarding retirement plans. (Hewitt Associates)


Links to Items on Executive Comp, Benefits in General

Participant Must Exhaust Plan's Claims Procedures before Filing Fiduciary Breach Claim
Excerpt: "Other Circuits ... take a different approach and do not require exhaustion of administrative procedures for ERISA statutory claims, such as allegations of fiduciary breach. Plans operating in the Eleventh Circuit (and in other Circuits that require exhaustion, including the Seventh) may wish to draft their claims procedures to be more explicit about the need to exhaust the plans' administrative procedures even for claims other than simple benefit claims." (Employee Benefits Institute of America Inc.)

FASB May Change COLI Valuation Rules
Excerpt: "The Financial Accounting Standards Board has released draft abstracts of 2 proposed guidelines that could affect business users of life insurance." (National Underwriter Life & Health; free one-time registration or paid subscription required)

G.ays at The Boston Globe Told to Marry or Lose Benefits
Excerpt: "Globe staffers have been told that health and dental benefits for g.ay employees' domestic partners are being discontinued. G.ay couples who want to keep their benefits must marry by Jan. 1. " (Boston Herald)

Stock Option Awards Grew for Top-Earning Washington Executives, Declined for Others Last Year
Excerpt: "The Washington Post's annual ranking of local executive pay was topped by four chief executives who received more than $30 million each:....' [The target page provides links to the other articles in the Post's Executive Pay Package special.] (The Washington Post; one-time registration required)

Contribution of Sick and Vacation Pay to Gov't Defined Contribution Plans, 2006 Update (PDF)
2 pages. Excerpt: "Unless specified elsewhere, the proposed regulations when finalized will formally go into effect for limitation years beginning on or after January 1, 2007. Plans are, however, allowed to immediately adopt the provision allowing sick and vacation leave pay to be deferred into a 457(b) plan within 2-1/2 months following severance of employment." (National Association of Government Defined Contribution Administrators Inc.)

Overview: Participation in Tax Shelters by Tax-Qualified Retirement Plans or VEBAs
Excerpt: "The Tax Increase Prevention and Reconciliation Act of 2005 (signed into law on May 17, 2006) imposes a $20,000 excise tax on each entity manager of a tax-qualified retirement plan that approves the plan as (or otherwise causes the plan to be) a party to a prohibited tax shelter transaction at any time during the taxable year and knows or has reason to know that the transaction is a prohibited tax shelter transaction." (Thelen Reid & Priest LLP)

Hewitt Federal Legislation Quick Guide Updated as of July 5, 2006, for human resources and employment (PDF)
7 pages. This Federal Legislation Quick Guide provides short updates on federal legislation that is currently under active consideration by Congress or has recently been enacted into law regarding human resources and employment law. (Hewitt Associates)


Newly Posted Press Releases
(Post Yours!)

National Council on Aging Names Stuart Spector as Senior Vice President
(National Council on Aging (NCOA))

Startek Unveils Contact Center Support For Consumer-Driven Health Plans
(StarTek, Inc.)


Newly Posted or Renewed Job Openings
Post a Help Wanted Ad

Pension Administrator
for Primark Benefits
in CA

401 (k) Administrator
for Compliance/Administration Company
in NJ

Retirement Plan Coordinator
for American Funds, a part of The Capital Group Companies, Inc
in TX

Benefit Analyst/Consultant (Travel Required)
for CCA Strategies
in CO, GA, IL, MA, TX

Retirement Services Specialist
for Heard, McElroy & Vestal, LLP
in LA

401(k) Plan Administrator
for Witt Mares Pension Designs
in VA

Employee Benefits Recordkeeper/Tester Analyst
for Wachovia
in MN

Senior Compliance Officer
for Bank of America
in CT, IL, MA, MO

Field Service & Underwriting Manager
for Standard Insurance Company
in TX

Retirement Plan Wholesaler
for Benefit Consultants Group
in DE, MD, NJ, NY, PA

Pension Administration Analyst Exp
for Hewitt Associates
in GA

Pension Administration Analyst-Entry
for Hewitt Associates
in GA

Actuarial Analyst - Experienced
for Hewitt Associates
in IL

Pension Assistant
for R.J.L. Pension Services, Inc.
in FL

Plan Administrator
for Acuff & Associates, Inc.
in TN




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