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| August 29, 2007 |
| Here are the Internet's newest links on plan operation, design and policy; emphasis is on compliance and costs. |
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Official Guidance; News
Text of IRS Summary of Proposed Regs. on Benefit Restrictions for Underfunded Pension Plans (PDF)3 pages; Employee Plans News for August 29, 2007 ('News Flash'). Excerpt: "For a plan with an AFTAP below 80%, a plan must provide that, unless the plan sponsor contributes the amount of the increase in plan liability resulting from the plan amendment, an amendment that increases benefit liabilities (e.g., providing new benefits, changing the benefit accrual rate, or improving the vesting schedule) cannot take effect." (Internal Revenue Service)
IRS Working on Model 403(b) Plan, Official Says
Excerpt: "The new 403(b) regulations aim to diminish the extent to which tax-sheltered annuities differ from other salary-reduction arrangements, such as 401(k) and 457 plans, according to Robert Architect of the IRS's Tax Exempt and Government Entities Division." (Wolters Kluwer Law & Business)
Credited Interest Problem in PPA Looks 'Fixable'
Excerpt: "An amendment developed by NCTR and NASRA to address potential age discrimination problems for public plans -- created by limits in the 2006 Pension Protection Act (PPA) on the amount of interest that may be credited by a defined benefit plan -- appears to be acceptable to key Congressional staff." (National Council on Teacher Retirement)
State Senate Candidate Says He Would Not Take Senate Salary, Would Abolish Pensions
Excerpt: "State Senate candidate Mark Albertini said he will not accept a salary during his first term if he is elected to the 10th district post. He also said he would limit himself to two terms. Mr. Albertini, an earlier candidate for governor, also said state pensions should be abolished." (The Chattanoogan.com)
New York State Pension Inquiry Scrutinizes Fees to a Hevesi Consultant
Excerpt: "State investigators have been scrutinizing fees paid to the political consultant Hank Morris by investment firms seeking business with the New York State pension fund, including $12.3 million the Carlyle Group paid to a firm that employed Mr. Morris, according to companies that have been contacted as part of the inquiry." (The New York Times; free registration required)
Summary/Analysis of Official Guidance
Cash Balance Plans Get New Lease on Life with Latest Rulings, Legislation (PDF)6 pages. Excerpt: "With pension reform legislation in 2006 and the recent court ruling in favor of IBM, the landscape for cash balance plan sponsors has dramatically improved. This article reviews the historical context and effect of these changes, and takes a look at how companies can best manage their plans going forward." (Benefits Quarterly via Milliman)
Trends; Surveys; Research
Overview: IRS Targets School Districts for 403(b) Review2 pages. Excerpt: "Over the next eighteen months, the Internal Revenue Service (IRS) will be contacting public school districts in every state to determine whether the districts' 403(b) plans are complying with the 'universal availability' rule." (von Briesen & Roper, s.c.)
Pension Freezes: Has the Worst Passed?
Excerpt: "The percentage of plan sponsors that froze their pension plans dropped from 7 percent in 2006 to 4 percent in 2007, according to a recent study by Watson Wyatt. Studies over the last few years have shown a gradual and steady increase in plan freezes, but this year we might be seeing the beginning of a slowdown." (Watson Wyatt Worldwide)
For HR Leaders Struggling to Strengthen Their Retirement Programs, Outsourcing Firms Can Help
Excerpt: "The consolidated annual growth rate for . . . 'total retirement' outsourcing is projected to be almost 20 percent through 2007, according to a June 2006 study, Next Wave: Opportunities and Challenges in the Total Retirement Outsourcing Market, by Waltham, Mass.-based Chatham Partners, a market research and strategy consulting firm." (Human Resource Executive Online; free registration required)
Target Maturity Funds Seen As Deficient in Providing Adequate Retirement Income
Excerpt: "From Spencer's Benefits Reports: Two recently released studies have called into question the ability of target date funds and lifecycle funds to provide 401(k) plan participants with adequate retirement income security by age 65." (Wolters Kluwer Law & Business)
How Have People Responded to Changes in the Retirement Earnings Test in 2000?
Excerpt: "This article explores how individuals affected by the removal of the earnings test have changed their participation in the workforce and the amount that they earn. It also looks at changes in benefit claiming among those who have reached the full retirement age. Results are based on longitudinal data from the Social Security Administration that cover the 4 years before and after the change." (U.S. Social Security Administration)
Links to Items on Executive Comp, Benefits in General
CEO Pay and Benefits on the Rise, According to Report
Excerpt: "Top executives at major U.S. businesses last year made as much money in one day of work on the job as the average worker made over the entire year, according to a report released [today]." (Reuters)
Union Urges Auditors to Dig Deeper for Executive Options Excesses
Excerpt: "The AFL-CIO wants auditors to step up their reviews of corporate books and records in order to curb illegal stock option backdating." (Workforce Management; free registration required)
Calif. Supreme Ct Allows Deductions for Operating Losses from Incentive Compensation/Bonus Plans (PDF)
4 pages. Excerpt: "On August 23, 2007, the California Supreme Court in Prachasaisoradej v. Ralphs Grocery Company, Inc. held that an incentive compensation plan that allows employees to share in profits, as calculated by subtracting operating expenses from revenues, does not violate Labor Code provisions or Wage Order regulations that prohibit an employer from taking wage deductions to cover operating losses." (Seyfarth Shaw LLP)
FEI's Committee on Taxation Reiterates Opposition to Executive Compensation Tax
Excerpt: "FEI's Committee on Taxation (COT) has submitted correspondence to the chairs and ranking members of the Congressional tax-writing committees urging them to resist two revenue-raising tax provisions on executive compensation." (Financial Executives International)
New Graduates More Benefits Savvy Than Employers Might Expect
Excerpt: "Although conventional wisdom persists that young workers are mainly concerned with salary, 'this generation is far more savvy and interested in benefits, such as medical and retirement, than previous generations,' says Steven Rothberg, president and founder of CollegeRecruiter.com. 'I would say it's because they listen to their parents more than previous generations, and their baby boomer parents are at an age where benefits matter a great deal.'" (Employee Benefit News; free registration required)
Social Security Online for Human Resource Managers
Excerpt: "This site provides information to human resource managers regarding the various Social Security programs and Medicare and is a valuable resource in helping your employees plan for retirement or other life events." (U.S. Social Security Administration)
Newly Posted Events
Advisory Council on Employee Welfare and Pension Benefit Plans Working Group on Fiduciary Responsibilities Update and Revenue Sharing; Notice of Meeting
in District of Columbia on September 20, 2007
presented by U.S. Department of Labor, Employee Benefits Security Administration (EBSA)
Advisory Council on Employee Welfare and Pension Benefit Plans Working Group on Financial Literacy; Notice of Meeting
in District of Columbia on September 19, 2007
presented by U.S. Department of Labor, Employee Benefits Security Administration (EBSA)
Advisory Council on Employee Welfare and Pension Benefit Plans Working Group on Participant Benefit Statements; Notice of Meeting
in District of Columbia on September 18, 2007
presented by U.S. Department of Labor, Employee Benefits Security Administration (EBSA)
Advisory Council on Employee Welfare and Pension Benefit Plans; 139th Full Council Meeting; Notice of Meeting
in District of Columbia on September 19, 2007
presented by U.S. Department of Labor, Employee Benefits Security Administration (EBSA)
Retirement Plan Update - with speakers Alan Friedland, Keith Dropkin & Monique Warren from Jackson Lewis, LLP
in Connecticut on September 19, 2007
presented by National Institute of Pension Administrators-CT Chapter
Newly Posted Press Releases
U.S. Department of Labor's ERISA Advisory Council Sets September 2007 Meetings
U.S. Department of Labor, Employee Benefits Security Administration (EBSA)
United Benefit Advisors: Annual Benchmark Survey Shows Average Annual Health Plan Cost is $6,881 Per Employee; Largest Percentage of CDHP Adopters Comes from Employers with 25-100 Employees
United Benefit Advisors
Practicing What They Preach: GSK Announces Employee Wellness Initiative
GlaxoSmithKline
Recent Federal Court Decision Could Hurt Employer Healthcare Expenditures
HealthLeaders-InterStudy
Newly Posted or Renewed Job Openings
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Senior Benefits Analyst - Retirement Plans
for CA, Inc.
in NY
Defined Benefit Plan Senior Administrator
for Tegra Financial Partners
in GA
Pension Administrator / Actuary
for The Benefits Consulting Group, Inc.
in IL
Supervisor, Disability Benefits
for Standard Insurance Company
in NY
Part-Time Pension Administrator
for Orthodox Church in America Pension Plan
in NY
Account Consultant - R&S
for MetLife
in NJ
Handy Links:
- View Today's Active Message Threads
- Using the Web for Employee Benefits Research (hypertext article)
- Employee Benefits Library
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