Retirement Plans
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July 24, 2006
Today's sponsor: Benefit Software Inc.

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Do your employees know the value of their employer paid benefits?

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Benefit Software has over 25 years of experience helping thousands of employers communicate the full value of their benefits.

From traditional personalized printed statements to secure 24/7 employee benefits communication portals, we have the right solution for your organization.

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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)

Research Summary -- The Employer Match and Participant Behavior (PDF)
4 pages. Excerpt: "This report summarizes research regarding the relationship between employee and employer contributions in defined contribution (DC) plans such as 403(b)s and 401(k)s. It is intended to assist plan sponsors who are considering changes in their DC plans to attain certain objectives . . . ." (TIAA-CREF Institute)

Overview: IRS Lets Nonprofits Cut Some Workers from 401(k) Testing
Excerpt: "The Internal Revenue Service is loosening antidiscrimination requirements for organizations that offer 401(k) retirement plans to some employees and 403(b) plans to others. The new regulations, published . . . in the Federal Register, could affect a medical center, university or other organization that includes a government entity along with a for-profit entity, or a nonprofit arm along with a for-profit arm." (National Underwriter Life & Health; free one-time registration or paid subscription required)

Brennan Speech Sparks Debate Into 401(k)'s Actual Value When Accounting for Inflation and Wages
Excerpt: "John J. Brennan [gave a speech in early May titled: 'The Undertold 401(k) Story']. It's good reading for anyone who wants a broad overview of the world of pensions, 401(k) plans and retirement security. . . . He . . . challenges the idea that 401(k) plans are flawed and don't cut the mustard as a retirement income tool. He offered broad illustrations to prove his point. That's where the trouble started." (Scott Burns via Houston Chronicle)

Annual 401(k) Benchmarking Survey: 2005/2006 Edition (PDF)
39 pages. Excerpt: "[830] 401(k) plan sponsors participated in this survey. Respondents diligently answered scores of probing questions about their plans as well as, for the first time, a series of inquiries about other rewards programs. The result is a highly 'granular' snapshot of plan characteristics, policies, and trends." (Deloitte Consulting LLP; International Foundation of Employee Benefit Plans; International Society of Certified Employee Benefit Specialists)

Opinion: Congressional Plan for Corporate Pensions May Weaken Rather than Strengthen the System
Excerpt: "Lawmakers are on the verge of striking a deal on legislation that would force companies to shore up their defined benefit pension plans and raise the premiums they must pay into the Pension Benefit Guaranty Corporation, the funder of last resort for the pension system." (

Air Miles May Fund Pension Shortfall in Britain
Excerpt: "The Independent reports that 'British Airways is mulling the sale of its Air Miles customer loyalty scheme to help fill a pensions deficit that could be twice as big as first thought'." (Pension Risk Matters; posted by Susan Mangiero)

PBGC Says GMAC Buyers Not Liable for Pensions
Excerpt: "The Pension Benefit Guaranty Corporation (PBGC) said it would not hold the buyers of General Motors' financing unit responsible for the automaker's pension plan, which the agency once estimated had a shortfall of $31 billion." (; one-time registration required)

Court Says Advice Satisfies the Law in Milwaukee Pension Case
Excerpt: "The Wisconsin District 1 Court of Appeals has ruled that the advice the Milwaukee County Sheriff's Department received regarding its pension enhancement was sufficient to satisfy legal standards, even though the move led to 8,000 current and former county employees losing out on pension benefits." (; one-time registration required)

Overview: Changes Proposed to Social Security System in Portugal
Excerpt: "Changes to the social security system in Portugal have been under discussion in government circles for several months with a number of announcements being made indicating that changes would soon be forthcoming. The Government has now launched a consultation process on the changes it proposes, with the objective of issuing new legislation in the latter part of 2006 to take effect on 1 January 2007." (Watson Wyatt Worldwide)

Text of House Debate on Rep. Miller's Motion to Instruct Conferees on July 20, 2006 (PDF)
6 pages. Excerpt: "MOTION TO INSTRUCT CONFEREES ON H.R. 2830, PENSION PROTECTION ACT OF 2005 [by George Miller of California]." (U.S. Congressional Record via American Benefits Council)

Links to Items on Executive Comp, Benefits in General

Participant Did Not Revoke His Written Beneficiary Designation When He Visited Plan's Website
Excerpt: "EBIA Comment: This case serves as a useful reminder to plan sponsors using electronic administration to ensure that plan websites (and other electronic features) are consistent with plan documents and SPDs. This plan's website allegedly stated that beneficiary designations 'previously made on paper will no longer be valid,' . . . ." (Employee Benefits Institute of America Inc.)

Fiduciary Duty Breached Where Failure to Credit Plan Accts Is Based on Misreading of Plan Language
Excerpt: "An employer's misreading of defined contribution plan terms, which served to divest plan participants of vested benefits, justified the removal of the employer as a plan fiduciary because the flagrancy of the misreading was evidence that the employer was not acting in the best interests of the participants, according to the U.S. Court of Appeals in Richmond (CA-4)." (CCH Pension & Benefits)

New GASB Staff Guidance on Qualifying OPEB Plan Trusts and Fiduciary Responsibilities (PDF)
2 pages. Excerpt: "Because the guidance is of immediate relevance for many governments who are implementing the OPEB standards, it is being posted to the GASB Web site in advance of publication." (Governmental Accounting Standards Board)

Overview: Discretionary Anti-Dilution Adjustments in Equity Compensation Plans (PDF)
4 pages. Excerpt: "Major accounting firms recently have interpreted the guidance in FAS 123R in a manner that could lead to significant unanticipated compensation charges in connection with equity restructurings. Common anti-dilution adjustments that had no accounting consequences under APB 25 and FIN 44 could result in substantial additional compensation expense under FAS 123R if they are done on a permissive, rather than mandatory, basis." (Alston & Bird LLP)

New Web Site Pairs Older Workers with Firms Seeking Experienced Employees
Excerpt: "Borders . . . is one of the companies recruiting through an online service,, which connects workers ages 50 and older with jobs. is the latest player focused on helping recruiters find qualified mature workers. Rivals include and Senior Job Bank." (Workforce Management; one-time registration required)

SEC To Vote on Final Rule on Executive Compensation July 26
Excerpt: "On July 20, 2006, the U.S. Securities and Exchange Commission (SEC) posted a Sunshine Act notice announcing it will hold an open commission meeting on Wednesday, July 26 to consider adopting final rule(s) amending the disclosure requirements on Executive Compensation." (Financial Executives International)

Managing ERISA Risk: Some Thoughts on Limiting Liability
Excerpt: "[V]irtually all plan sponsors and plan administrators must contend with the very real possibility of suffering large actual losses as a result of their sponsorship of employee benefit plans. In strategizing methods for avoiding such losses, sponsors and administrators should examine their exposure in two critical areas: (1) liability for errors made by sponsors and administrators; and (2) employment discrimination claims brought under ERISA Section 510." (Faegre & Benson LLP)

DOL FAQs for Reservists Being Called to Active Duty
Excerpt: "The Department of Labor's Veterans' Employment and Training Service (VETS) has information for veterans, National Guard or reservists who may be activated for military service. National Guard and reserve members called to active duty, and their civilian employers, have certain rights and responsibilities under the Uniformed Services Employment and Reemployment Rights Act (USERRA). [T]he USERRA Advisor . . . . and other USERRA information, can be found on the VETS Web site." (U.S. Department of Labor, Employee Benefits Security Administration)

Audio: A Conversation on the SEC's Targeting of 80 Companies in Stock Option Probe
Excerpt: "The Securities and Exchange Commission is investigating more than 80 companies in cases related to backdating executive stock options. Robert Siegel talks with John (Jack) Coffee, professor of law and director of the Center on Corporate Governance at Columbia University Law School." (All Things Considered via National Public Radio)

Silicon Valley Firms Scrutinized on Stock Option Policies
Excerpt: "[O]nce again, the corporate scandal of the moment -- the manipulation of stock options -- is placing Silicon Valley and its past practices in an unflattering light. Of the more than 80 businesses that have been caught up in federal investigations or have announced their own internal reviews, technology companies make up the overwhelming majority." (The New York Times; one-time registration required)

We thank and invite your attention to our additional sponsor: The Center for Tax Law and Employee Benefits at The John Marshall Law School

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Banner ad for The Center for Tax Law and Employee Benefits at The John Marshall Law School

You Have the Potential. We Have the Programs.

Are you working in human resources? Are you dealing with health insurance plans or pension benefits? Learn how you can broaden your experience with an M.S. degree (for non-lawyers) or LL.M. degree (for attorneys) in employee benefits from The John Marshall Law School in Chicago during an information session from 5 to 7 p.m., Wednesday, August 2. Learn how these unique programs can help advance your career.

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

Newly Posted Events
(Post Yours!)

All Day Summer Workshop
in Ohio on August 22, 2006
presented by ASPPA Benefits Council of Cleveland

ERISA Litigation Forum
Nationwide on August 1, 2006
presented by Paul, Hastings, Janofsky & Walker LLP

Newly Posted or Renewed Job Openings
Post a Help Wanted Ad

Defined Contribution Administrator
for Pension Plan Professionals, Inc.
in FL

Actuary Analyst Exp-Retirement
for Hewitt Associates
in TX

Healthcare Consultant
for SHPS
in CA

Corporate Services Account Officer- Trust
for National Penn Investors Trust Company
in PA

Human Resources Benefits Analyst
for MTA- New York City Transit
in NY

Retirement Analyst
for San Diego County Employees Retirement Association
in CA

Manager - Technical Services - Aris Pension Services
for Aris Corporation of America
in PA

Qualified Retirement Plan Administrator
for Benefits Integrity
in CO

401 (k) Administrative Assistant - Director of First Impressions
for Scholz, Klein & Friends Enlightened Retirement Group, Inc.
in TX

Sr. Sales Rep - Mgr Public Safety - West
in AZ, CA, CO, ND, NE, NM, SD, TX

Retirement Plan Specialist - Sales Representative
in NH

Retirement Plan Consultant
for Qualified Plan Consultants, LLC
in IA

Employee Meeting Liaison
for T. Rowe Price
in MD, NY

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