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November 22, 2006
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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)

Oneida Sues PBGC Challenging Pension Termination Fees
Excerpt: "The Oneida, N.Y.-based flatware maker filed a lawsuit in the U.S. Bankrup.tcy Court for the Southern District of New York in Manhattan against the Pension Benefit Guaranty Corp. In essence, the lawsuit challenges a new federal law that requires Oneida in particular to pay $6.9 million in termination fees that now applies to pension plan terminations occurring in bankruptcies filed after Jan. 1, 2006." (Law.com)

Taking Charge of Your Retirement Funds in a Rollover
Excerpt: "The NYSE's enforcement unit . . . has been hearing some complaints that indicate all's not well in the land of rollover IRAs. Brokerage customers have been complaining that they've suffered big losses when transferring their money that had been subsequently invested in high-risk stocks and mutual funds." (The Motley Fool)

Overview of Proposed Regulations on Default Investments -- Should Employers Act Now?
Excerpt: "Plans generally specify a 'default' investment option to be used when a participant fails to give investment directions. Many plans have in the past used a conservative fund, such as a money market or stable value fund, to protect against the loss of principal. Such a conservative option, however, may expose plan fiduciaries to claims of breach of fiduciary duty, the argument being that a conservative option is not a prudent choice for a long-term investment." (Faegre & Benson LLP)

Opinion: New Directions for Retirement Savings Provided by the PPA
Excerpt: "Historically, 401(k) plans were viewed as supplemental, or savings, plans. However, 401(k) plans are now the primary retirement vehicles for most employees. Unfortunately, the laws have not changed so that 401(k)s can be effective, or successful, retirement plans -- at least not until now." (Fred Reish via PLANSPONSOR.com; free registration required)

ACLI Wants Guaranteed Insurance Products Included in DOL Roster of QDIAs
Excerpt: "The American Council of Life Insurers is calling for the Department of Labor to include guaranteed insurance products in proposed rules that would clarify the types of qualified default investment alternatives that could be used in automatic enrollment plans." (Investment News; free registration required)

Pension Disclosure and SEC Sanction: The San Diego Affair
Excerpt: "According to its website, the SEC sanctioned the City of San Diego 'for committing securities fraud by failing to disclose to the investing public important information about its pension and retiree health care obligations in the sale of its municipal bonds in 2002 and 2003.'" (Pension Risk Matters)

List of Companies That Have Changed Their Defined Benefit Pension Plans Since December 2005
Excerpt: "Changes include plan terminations, plan freezes for new and/or current employees, and changes to the formula by which pension benefits are calculated." (Pension Rights Center)

CEOs Cite Pension Costs As Key Worry, According to Survey
Excerpt: "Just over a third of chief executives of fast-growing private companies polled in a recent survey listed increasing health care and pension costs among their most pressing challenges." (PLANSPONSOR.com; free registration required)

Oregon Public Workers Get Details of PERS Funds: Statements Mailed for Individual Account Program
Excerpt: "The Public Employees Retirement System mailed statements last week to all public employees, revealing the value of their IAP accounts as of Jan. 1. PERS also restated what the accounts earned from investments in 2004." (StatesmanJournal.com)

Los Angeles Unified School District Goes Extra Mile to Disclose Plan Fees
Excerpt: "Specifically, the school district is having its provider, American International Group, list the revenue-sharing fees for each of the funds in its new retirement plan to employees in every communications piece they receive." (Workforce Management; free registration required)

County Quashes Lump-Sum Distribution Pension Option
Excerpt: "Milwaukee County retirement officials have slammed the door on a little-known and seldom-used pension option after a retiring county attorney opted to take a lump-sum payment of all of his pension benefits, which he says should total $746,000." (Milwaukee Journal Sentinel)

Overview of the PPA: New Plan Design Options, New Plan Requirements, New Fiduciary Protection (PDF)
22 pages. Excerpt: "Key among the changes unrelated to pension plan funding are extensive new rules governing the implementation of three retirement plans designs automatic enrollment plans, cash balance and other 'hybrid' plans, and combined defined benefit pension/401(k) plans for small employers." (Hay Group)

Hewitt Federal Legislation Quick Guide Updated as of November 21, 2006, for Retirement Plans (PDF)
2 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)

List of Technical Corrections/Regulatory Issues of Employer Stock Diversification Provisions of PPA (PDF)
7 pages. Excerpt: "This document sets forth possible technical corrections and administrative issues with respect to the employer stock diversification provisions of the Pension Protection Act of 2006. The page and line references . . . are to the version of H.R. 4 that passed the House." (American Benefits Council)

Commentary: Pension Protection Act Redux?
Excerpt: "With the dust clearing on the recent mid-term elections, we thought it might be beneficial to speculate on what, if any, effects the Democratic takeover of Congress might have on the recently enacted Pension Protection Act." (BNA Pension & Benefits Blog)

PPA Technical Corrections or Agency Guidance Needed with Respect to Defined Contribution Plans (PDF)
10 pages. Excerpt: "Overall: Pending the issuance of administrative guidance on the defined contribution issues of the Act, employers should be permitted to rely on a reasonable, good faith interpretation of the statutory provisions." (American Benefits Council)

Retirement Security: Fixing the Three-Legged Stool of Social Security, Pensions, & Personal Savings
Excerpt: "This article provides a wide-angle view of the looming crisis in retirement security. . . . This article first reviews the current status of retirement security in the United States and finds that all three legs of the retirement stool - Social Security, pensions, and private savings - are projected to fall short . . . ." (Minnesota Law Review via Social Science Research Network)

Florida Sheriff Sues Nationwide Insurance Over Fees
Excerpt: "A Florida Sheriff's Department has sued Nationwide Life Insurance Co., [alleging that] Nationwide's retirement plan fees unfairly allowed the company to make a profit through a revenue sharing arrangement." (PLANSPONSOR.com; free registration required)

Social Security Up for Discussion -- Treasury Chief Says 'No Preconditions'
Excerpt: "'No preconditions,' Paulson said, means both sides get a chance to put their ideas on the table. In regard to Social Security, administration officials said that means President Bush will continue to advocate that younger workers be allowed to divert a portion of their Social Security taxes into private retirement accounts, a proposal Congress roundly rejected last year." (The Washington Post; free registration required)


Links to Items on Executive Comp, Benefits in General

Video: As Americans Live Longer, & Caregivers Dwindle, Frontline Explores What It Means to Grow Old
Excerpt: "[The program includes e]xtended interviews with geriatricians, a nurse, a general practitioner, a bioethicist and elderly people and family members on the hopes and challenges of aging; Profiles of individuals and families featured in the program and the physical and emotional burdens they've experienced over the years -- even decades; An interactive map featuring the demographics of America's elderly; the comparative costs of nursing homes, assisted living and home care . . . ." (FRONTLINE via PBS)

Alaskan House Passes Legislation Calling for Advisory Vote on Same-Sex Benefits
Excerpt: "Before adjourning on Friday, the House passed House Bill 4001 which prohibits the commissioner of administration from adopting or implementing regulations that grant or extend employment-related benefits to same-sex partners of state employees and members of the state retirement systems unless expressly authorized by statute. The House also passed House Bill 4002 which calls for a statewide advisory vote." (Stories in the News)

Hewitt Federal Legislation Quick Guide for November 21, 2006, on Human Resources & Employment Law (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)


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Team Leader, Regional Service Team
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