BenefitsLink |
 |
 |
| December 14, 2007 |
| Here are the Web's best new links about compliance and cost aspects of plan operation, design and policy. |
Today's sponsor is ASPPA
(Click on company name or banner to learn more.)
| The ASPPA 401(k) SUMMIT |
| Join over 1,400 retirement sales and investment professional at the retirement industry's longest running conference, The ASPPA
401(k) SUMMIT. Attend advisor centered workshops, general sessions with internationally known speakers, secure insurance and other CE credits, network with your peers and more in Orlando, Florida, February 10-12, 2008. Don't miss your opportunity to join the best of the best. Early bird savings apply so register NOW. |
(a) New Guidance Documents
Coming on Monday: New Final PBGC Regs Creating New 'Termination Premium'
(Pension Benefit Guaranty Corporation (PBGC))
(b) News
Additional Important Opportunity for Practitioners to Suggest Improvements to the Employee Plans Compliance Resolution System (EPCRS)
Attorneys, consultants, third-party administrators and other retirement plan practitioners dealing with IRS audits of retirement plans: please take time to compose and submit your recommendations as to how the Employee Plans Compliance Resolution System (EPCRS) could be improved. These recommendations are being collected by a committee selected by the IRS, for an important report that will help the Treasury Department and IRS comply with Congress' directive under the Pension Protection Act of 2006 to assess and possibly modify the program. The link will take you to an online form, or you can submit your comments in the form of an emailed Word document. Thank you! (The committee requested and received practitioners' comments in October, but would like to receive even more.) (IRS Advisory Committee (ACT) on Tax Exempt and Government Entities)
Empire State Cracks Down on Pension Fund Ethics
Excerpt: "The new rules for the New York State Common Retirement Fund are aimed at the types of conflicts of interest that led to a sizable controversy under former Comptroller Alan Hevesi . . . who agreed to step down under pressure earlier in 2007, according to an Associated Press report." (PLANSPONSOR.com; free registration required)
U.S. Senate Passes Sudan Divestment Bill
Excerpt: "Reuters reports the legislation permits U.S. state and local governments, as well as mutual funds and private pension funds, to divest their investments in companies involved in four Sudanese business sectors. The bill permits divestment from companies involved in Sudan's oil industry, mineral extraction, power production, and the production of military equipment.' (PLANSPONSOR.com; free registration required)
Christmas Bonus in Jeopardy for Retirees
Excerpt: "Stalled contract talks at a General Motors Corp. truck factory near Dayton could leave more than 9,000 Delphi Packard retirees short of Christmas cash. An estimated $700 pension bonus per retiree is tied up in the negotiations between GM and the International Union of Electrical Workers-Communications Workers of America." (The Tribune Chronicle)
(c) Summaries of Guidance; Filed Comments
Overview: Proposed Plan Regs Require Glimpse Inside the Bundles
Excerpt: "EBSA, an arm of the U.S. Labor Department, has included a bundled service provider section in a new batch of proposed regulations dealing with pension plan and health and welfare plan fee disclosures." (The National Underwriter Company; free registration or paid subscription required)
Overview of Final Revised Form 5500 -- New Fee Reporting Rules
Excerpt: "The Department of Labor published final revisions to Form 5500 for 2009, part one of a three-part DOL project on defined contribution plan fees. This article reviews new reporting requirements for Schedule C, with respect to DC plans." (JPMorgan)
Overview: DOL Proposes New ERISA Disclosure Requirements for Plan Service Providers (PDF)
4 pages. Excerpt: "On December 13, 2007, the Department of Labor proposed new disclosure and related requirements under ERISA for certain service providers to employee benefit plans. This is the second of three regulatory projects DOL has announced to deal primarily with the question of indirect compensation in the employee benefit market." (Sutherland Asbill & Brennan LLP)
New Rules Require Employers to Re-Think Treatment of Post-Severance Compensation in Tax-Qualified Retirement Plans
Excerpt: "Under the new rules, a qualified plan generally must exclude post-termination compensation. However, special rules apply to certain amounts paid within 2-1/2 months after the participant's termination or, if later, by the end of the plan's limitation year in which the termination occurs . . . ." (Poyner Spruill LLP)
Overview: EBSA Puts Out Provider Fee Disclosure Proposal
Excerpt: "Federal regulators on Wednesday issued the second of a three-part disclosure rule package -- proposed mandates for detailed disclosures from service providers to plan fiduciaries." (PLANSPONSOR.com; free registration required)
(d) Trends, Surveys, Research
Illustration of How 401(k) Management Fees Add Up
Excerpt: "Wondering why it is so important for ERISA fiduciaries to prudently select mutual funds with reasonable management fees? Here's a telling chart provided to us by the good people at the New York Times' The Board Blog: The chart . . . shows the effect on earnings of even one percentage point difference in annual fees on a 401(k) balance of $20,000 invested over 20 years." (Workplace Prof Blog)
Too Many 401(k)s Still Have Investments in Too Much Company Stock
Excerpt: "[O]ddly enough, six years after Enron's spectacular fall, company stock remains the single largest employee holding in 401(k) plans. On average, employees have 21.9% of their 401(k) money invested in their employer's stock, according to a 2006 report by Hewitt Associates, the human-resources consulting firm. One in five plan participants have at least half their retirement money invested in company shares, Hewitt says." (USA TODAY)
Employers Focusing on 'Quality' of 401(k) Plan Enrollment, Hewitt Study Shows
Excerpt: "Employers are taking more proactive steps to prepare their employees for retirement through a more sophisticated design of the automated features of their 401(k) plans . . . ." (Wolters Kluwer Financial Services)
Employees Not Managing 401(k) Plans Properly
Excerpt: "Employees must be proactive in managing their 401(k) plans and understand the investments offered in order to maximize the value of the plan, according to Aon Consulting Worldwide, which recently released a list of tips on retirement readiness." (Employee Benefit News; free registration required)
Whither Goes the 403(b) Market in 2008? (PDF)
5 pages. Excerpt: "[W]e believe that fundamental changes are unlikely -- but there will indeed be important adjustments. Therefore, plan sponsors and product and service vendors have key strategic decisions to make." (Still River Retirement Planning Software, Inc.)
Defined Benefit Plan Risk Especially Improved in 2006
Excerpt: "A Watson Wyatt analysis found that pension plan liabilities posed relatively high financial risk for only 8% of FORTUNE 1000 companies with pension plans in 2006, down from 17% in 2003." (PLANSPONSOR.com; free registration required)
The U.S. Retirement Market, Second Quarter 2007 (PDF)
20 pages. Excerpt: "Total U.S. retirement assets climbed to $17.4 trillion at the end of the second quarter of 2007, up from $16.7 trillion at the end of the first quarter of 2007. Retirement savings account for almost 40 percent of all household financial assets in the United States." (Investment Company Institute)
Hewitt Federal Legislation Quick Guide Updated as of December 12, 2007, for Retirement Plans (PDF)
13 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)
Why the Big Differences Between Public and Private Sector Retirement Benefits?
Excerpt: "[The first report from the Center for State and Local Excellence] details the many ways in which retirement benefit plans of state and local governments are different from the private sector." (Congressional Quarterly, Inc.)
New Report on Social Investing Suggests Positive Results
Excerpt: "The Asset Management Working Group of the United Nations Environment Programme Finance Initiative (UNEP FI) and Mercer LLC have recently issued a joint report suggesting that 'responsible investing' in companies based on environmental, social and governance (ESG) factors does not necessarily compromise investment performance, and may actually enhance it in some cases." (National Council on Teacher Retirement)
(e) Policy, Opinion, Advocacy
Text of the 'Defined Contribution Fee Disclosure Act of 2007' (PDF)
25 pages. (U.S. Senate via American Benefits Council)
Senate Subcommittee Gets Earful on Problems with Government Pension Offset and the Windfall Elimination Provision
Excerpt: "On November 6, 2007, the Senate Finance Committee's Subcommittee on Social Security, Pensions, and Family Policy held a hearing on 'GPO and WEP: Policies Affecting Pensions from Work Not Covered by Social Security.' The Subcommittee's chairman, Senator John Kerry (D-MA), had come under intense pressure to hold such a hearing after saying earlier in the year that he thought the best way to address the problems with GPO and WEP would be in the context of overall reform of the Social Security system." (National Council on Teacher Retirement)
Links to Items on Executive Comp, Benefits in General
International Headlines on Benefits, Compensation and HR Developments, Updated December 13, 2007
Top stories in this issue: The EU: Employment ministers deadlocked on key issues; Employment contracts for cross-border workers; Sweden: Parliament approves budget bill; Tax relief for EEA pensions; UK: Pensions Bill; Immigration reform; US: 409A transitional relief. (Mercer LLC; free registration required)
Claims and Remedies under ERISA Section 510: The Mysteries Continue
Excerpt: "Somewhat overshadowed by the Supreme Court's oral argument last week in LaRue v. DeWolff Boberg & Associates was the Court's denial of certiorari in another significant ERISA case, Eichorn v. AT&T Corp., 484 F.3d 644 (3d Cir. 2007) ('Eichorn II'). Eichorn II provides a vehicle to address dual ERISA mysteries: (1) Is an ERISA Section 510 claim possible when the plaintiffs are a class of employees affected by a corporation reorganization?; and (2) If so, is there a remedy for such a Section 510 claim under ERISA Section 502(a)(3) that qualifies as equitable relief?" (Workplace Prof Blog)
Overview: PA Update: Tax Exemption and Reporting Requirements for Employer-Owned Life Insurance
Excerpt: "PPA added sections to the IRC regulating tax exemption and reporting requirements for employer-owned life insurance. In this article, we'll give a bit of background and then focus on the new requirements added by PPA." (JPMorgan)
Hewitt Federal Legislation Quick Guide for December 12, 2007, on Human Resources & Employment Law (PDF)
12 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)
Overview: IRS Guidance on Correcting Operational Failures of Nonqualified Deferred Compensation Plans
Excerpt: "The transition relief and guidance provide: (1) methods for correcting operational failures during the tax year of the service provider in which the failure occurs to avoid income inclusion and (2) transition relief limiting the amount includible in income for certain operational failures occurring in a service provider's tax year beginning before January 1, 2010 that involve only limited amounts." (Wolters Kluwer Financial Services)
Overview: SEC Exemptions from Registration for Compensatory Employee Stock Options
Excerpt: "The new exemptions give many private, non-reporting companies and reporting companies increased flexibility to grant employee compensatory options with fewer regulatory requirements and presumably lower costs, as long as the company meets the conditions of the applicable exemptions. The exemptions allow these companies to continue to grant compensatory stock options to a wide range of employees without triggering the registration requirements of Section 12(g) of the Exchange Act at the time of issuance of the stock options." (Blank Rome LLP)
American Benefits Council Talking Points on House-Passed Provision on Offshore Nonqualified Deferred Compensation (PDF)
2 pages. Excerpt: "In general, the provision would apply to compensation paid to a U.S. taxpayer by a foreign company unless substantially all of the company's income is subject to a 'comprehensive foreign income tax.'" (American Benefits Council)
Newly Posted Events
409A Corrections Program: Compliance, Relief and Legislative Proposals - Webcast
Nationwide on December 19, 2007
presented by ALI-ABA (American Law Institute-American Bar Association)
Newly Posted Press Releases
GAO Report Under-Represents the Success of Employer Defined Contribution System Says PSCA
Profit Sharing/401(k) Council of America (PSCA)
RAND Study Finds Evidence Disease Management Programs May Improve Quality of Care, But May Not Save Money
RAND Corporation
Reinventing an Aging Workforce
Conference Board, The
Health Coaching a Key Employee Benefit in Controlling Healthcare Costs
Hummingbird Coaching Services
Newly Posted or Renewed Job Openings
(Post a Job | View All Jobs |
RSS Feed )
Senior DC Plan Consultant\Administrator
for Simpkins & Associates (a regional administrative firm with Dallas opening)
in TX
Pension Administrator
for Pension Investors Corp. of Orlando
in FL
Vice President, Investment Advisory Services
for Sapers & Wallack, Inc
in MA
Defined Contribution Plan Administrator
for Pension Planning Consultants, Inc.
in NM
Employee Benefits Client Service Agent
for BB&T
in SC
Handy Links:
- View Today's Active Message Threads
- Using the Web for Employee Benefits Research (hypertext article)
- Employee Benefits Library
Subscribe to the BenefitsLink Health & Welfare Plans Newsletter, Too!
Sign-up form is at https://benefitslink.com/newsletter (free).
This newsletter is sent to you each workday except federal holidays.
This email has been published by:
BenefitsLink.com, Inc.
1298 Minnesota Avenue, Suite H
Winter Park FL 32789
(407) 644-4146
Fax: (407) 644-2151
David Rhett Baker, J.D., Editor
Copyright 2007 BenefitsLink.com, Inc.; except that you can forward this email in full (including this boilerplate part) or otherwise reprint this email in full (including this boilerplate part) without obtaining our permission.
Anyone can receive these emails; just have them sign up at this web page: https://benefitslink.com/newsletter/
Other useful links: