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February 13, 2008

Here are the Web's best new links about compliance and cost aspects of plan operation, design and policy.

Today's sponsor is SunGard

(Click on company name or banner to learn more.)
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[Guidance Overview] IRS Guidance on Applying Backloading Rules to 'Greater Of' Formulas
Excerpt: "The IRS has issued Revenue Ruling 2008-7 to explain its position on applying the antibackloading rules to certain cash balance conversions and to provide limited relief for plan years beginning before January 1, 2009." (Deloitte)

[Guidance Overview] Pension Payouts Are Shrinking
Excerpt: "Retirees who planned to take the money and run may find themselves with less than they expected. New rules that take effect in 2008 change the way pension plans calculate lump-sum distributions." (

[Guidance Overview] Loss from Delay in Distribution of Stock not Eligible for ERISA Relief
Excerpt: "The U.S. District Court for the Eastern District of Michigan has found a former 401(k) plan participant alleging a loss of income due to a custodian's errors in processing her company stock certificates has failed to state a claim for relief under [ERISA]." (PLANSPONSOR)

[Guidance Overview] Hewitt's Global Retirement Update, February 2008
3 pages. (Hewitt)

Nationwide Strike Over Pensions Cripples Greece
Excerpt: "A 24-hour nationwide strike against the Greek government's pension reforms crippled transport on Wednesday and shut down public services as unions prepared for a large rally in Athens." (New York Times; free registration required)

Some Observations on 401(k) Expense Recapture
Excerpt: "With regard to fees and commissions for advice, when plan sponsors are writing checks for the advice, the cost is usually reasonable. However, where the fees or commissions are embedded in the investment products (and particularly where they are difficult to find and calculate), many plan sponsors do not know what they are paying." (Reish Luftman Reicher & Cohen)

Some Brief Case Studies on Designing Automatic Enrollment Programs for 401(k) Plans
Excerpt: "This article discusses three cases involving our clients. The first is for a company that had a high level of turnover; the second is for a company that had low deferral rates for currently participating employees; and the third is for a company that was worried about the cost of matching contributions." (Reish Luftman Reicher & Cohen)

Some Observations for Plan Sponsors on the Limitation on Liability in Service Provider Agreements
Excerpt: "Service providers sometimes try to limit their liability for mistakes through provisions in their service contracts. These provisions raise a number of questions that plan sponsors need to consider." (Reish Luftman Reicher & Cohen)

[Opinion] Text of Comments by ERIC and PSCA on Proposed IRS Regs on Automatic Contribution Arrangements (PDF)
5 pages. (ERISA Industry Committee; Profit Sharing/401(k) Council of America)

[Opinion] Text of American Benefits Council's Comments on DOL Prop. Regs on Fee Disclosure for Services Provided to ERISA Plans (PDF)
15 pages. Excerpt: "[O]ne of our primary concerns is about the scope of the regulation and the need for a thorough vetting of all of the different types of arrangements that will be affected by the regulation. We also have questions about whether the regulation applies to certain basic arrangements, for example, whether the regulation applies to services that are provided to an investment fund purchased by a plan." (American Benefits Council)

[Opinion] Text of ASPPA Comments on Prop. Labor Regs on Fee Disclosure for Services Provided to ERISA Plans (PDF)
29 pages. Excerpt: "ASPPA and CIKR strongly support the Department's current regulatory initiatives on improving the disclosure of compensation and fees paid by plans to the fiduciaries who are responsible for the plans. . . . [But] we believe [these comments] will strengthen the disclosure regimen, and we also strongly encourage the Department to provide greater clarity regarding its disclosure requirements in order to promote consistent disclosures among service providers." (ASPPA; also: Council of Independent 401(k) Recordkeepers)

[Opinion] Text of ERIC Comments on DOL Prop. Regs on Fee Disclosure for Services Provided to ERISA Plans (PDF) (PDF)
8 pages. (ERISA Industry Committee; Profit Sharing/401(k) Council of America; Others)

Links to Items on Executive Comp, Benefits in General

[Guidance Overview] DOL Explains Duty of ERISA Fiduciaries to Collect Delinquent Contributions
Excerpt: "Outlining the interrelationship of ERISA §§ 402 through 405, the Department of Labor explained the basis by which a fiduciary is obligated to collect delinquent contributions, even where the fiduciary is a directed trustee not responsible under the trust document for monitoring or collecting contributions. U.S. Department of Labor Field Assistance Bulletin (FAB) No. 2008- 01 (February 1, 2008)." (Deloitte)

IRS Official to Discuss Recent 162(m) Ruling
Excerpt: "Because nothing says 'Happy Valentines Day' like guidance on Code Section 162(m), we will be having a webcast on the topic this Thursday. Kenneth Griffin, the author of the IRS' recent, surprising private letter ruling, will lead off the webcast . . . ." (Executive Compensation Blog published by Winston & Strawn LLP)

Bush Proposed Benefits-Related Revenues Measures for FY2009; 'Deja Vu All Over Again' on Most Employee Benefit Changes
Excerpt: "For good or ill, in the last year of any president's term, not much newly-introduced legislation from the White House sees the light of day. The Bush Administration's fiscal year 2009 proposed revenue sources outlined in the General Explanations of the Administration's FY 2009 Revenue Proposals, released by the Treasury Department on February 5, 2008, appears to be headed down the same road . . . ." (Deloitte)

Entry-Level Federal Government Hires Are Starting Later, Value Old-Fashioned Perks
Excerpt: "[T]he typical entry-level hire is surprisingly older than generally assumed, is highly motivated to land a federal job, and is interested in the same things that prior generations have valued: job stability, annual pay raises, vacation time and health insurance." (Washington Post; free registration required)

Newly Posted Events
(Post Yours!)

2008 Benefits Fair and Trade Show
in Massachusetts on May 21, 2008
presented by New England Employee Benefits Council

A Primer on Cash Balance Plans - Webcast
Nationwide on March 4, 2008
presented by ASPPA (American Society of Pension Professionals & Actuaries)

Is a Value-Based Formulary Right for You? Webcast
Nationwide on February 28, 2008
presented by International Foundation of Employee Benefit Plans

Plan Terminations: Case Studies and Real World Examples
in Massachusetts on February 28, 2008
presented by ASPPA Benefits Council (ABC) of New England

Newly Posted Press Releases
(Post Yours!)

Chetney Receives ASPPA 401k Leadership Award
ASPPA (American Society of Pension Professionals & Actuaries)

Employers Saying More About Benefits, Watson Wyatt Study Finds
Watson Wyatt

Financial Engines Doubles Managed Accounts Business in 2007
Financial Engines, Inc.

ERIC Submits Comments on Proposed Automatic Contribution Arrangement Regulations
ERIC (ERISA Industry Committee)

ERIC Submits Comments to DOL on Proposed 408(b)(2) Regulations
ERIC (ERISA Industry Committee)

Proposed Changes to FMLA 'Protect the Future of a Vital Law'
Society for Human Resource Management (SHRM)

Consumer Group Finds Use of Outdated Data and Other Major Flaws In Economist's Defense of Mandatory Purchase of Private Health Insurance
Foundation for Taxpayer and Consumer Rights

Century Healthcare Names Jay Beck As President and CEO
Century Healthcare

Xerox Awards Six Employees Social Service Leave for 2008
Xerox Corporation

BearingPoint Predicts Rapid Expansion of Health Savings Accounts if Universal Health Coverage Programs are Adopted
BearingPoint, Inc.

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Trust Administrator II or III
for Associated Pension Consultants
in CA

Client Relationship Manager-(Retirement)
for Merrill Lynch
in CO, NJ

Vice President - Equity Compensation
for Merrill Lynch
in NJ

PROFIT Plan Supervisor
for Publix Super Markets, Inc.
in FL

Retirement Compliance Specialist
for The Segal Co.
in CA

ERISA Compliance (4-5) Analysts
for Fortune 500 Company
in GA

Defined Benefit Analyst
for The Savitz Organization
in NJ, PA

Benefit Service Representative
for The Savitz Organization
in NJ, PA

Senior Defined Benefit Analyst
for The Savitz Organization
in NJ, PA

Health & Welfare Actuarial - Managing Consultant
for The Savitz Organization
in PA

for Citi
in MA

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