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April 1, 2008

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

Today's sponsor is ASC & The ASC Institute

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Banner ad for ASC & The ASC Institute

Let ASCi be your 403(b) tax-sheltered annuity plan document solution!

The IRS now requires that every employer with a 403(b) tax-sheltered annuity plan must have a written plan document in place by December 31, 2008. Whether you maintain thousands or just a few 403(b) plans, the ASCi Document Generation and Management (DGEM) system can help you manage these plans efficiently and easily.
Click here to learn more about how DGEM can help you meet the IRS requirements.

[Guidance Overview] The §403(b) Written Plan Requirements -- Can They be Satisfied with Existing Documents?
Excerpt: "The actual text of the regulations requires that the written plan contain all material terms and conditions for eligibility, benefits, applicable limitations, the contracts available under the plan, and the timing and form of benefit distributions. In addition, any optional plan features (e.g., hardships or loans) offered under the plan must be described in writing, as well as how responsibility for performing administrative functions is allocated between appropriate parties. The regulations also state that the written plan may incorporate other documents by reference, including the annuity contract or custodial account agreement." (; free registration required)

[Guidance Overview] Discontinued 403(b) Plan Contracts
Excerpt: "A 403(b) plan sponsor says there seems to be one question about vendor consolidation that hasn't been clearly addressed in general IRS publications - namely, what happens to contracts held by employees whose 403(b) providers were discontinued by the plan after 2005 and before 2008 (the regulations require plans to identify contracts available since 2005, those not identified in which assets are held can be considered taxable)? The sponsor asks: Is there any danger to our employees whose assets remain in contracts or custodial agreements with discontinued providers that their accounts will become taxable to them under the IRS' general statement that they may 'fail to meet the requirements of 403(b)?'" (; free registration required)

[Guidance Overview] Chart of New Multiemployer Plan Disclosures and Communications Required by Pension Protection Act of 2006 (PDF)
1 page. Excerpt: "The Pension Protection Act of 2006 (PPA) requires multiemployer pension plans to make a number of significant new disclosures to plan participants and beneficiaries, employee representatives, unions, employers, and regulators such as the IRS, the Department of Labor (DOL), and the PBGC. This 2008 Disclosure and Communications Calendar can help you get these important new notices out on time and on target." (Milliman)

[Guidance Overview] Listing of IRS Published Guidance for January - March 2008
The target page links to guidance published by the Service relating to retirement plans: Treasury Regulations; Revenue Rulings; Revenue Procedures; Notices; and, Announcements. (Internal Revenue Service)

[Guidance Overview] Proposed IRS Regs Amend Notice Requirements for Benefit Accrual Reductions
Excerpt: "The IRS has issued proposed regulations which would amend the requirements for providing notice to certain affected persons when a plan significantly reduces benefit accruals. The proposed regulations set forth timing rules for ERISA §204(h) notices for plan amendments reducing benefit accruals which are permitted to be effective before the applicable amendment date, and reflect other changes to notice requirements made by the Pension Protection Act of 2006 (PPA; P.L. 109-280)." (Wolters Kluwer)

[Guidance Overview] Fiduciary Responsibility - Some Important Steps That You Should Consider
Excerpt: "By following the eight steps discussed [in the target page], your plan will be more efficient, and you will be saving yourself a lot of future aggravation." (; free registration required)

[Guidance Overview] Final PBGC Premium Payment Regs Provide Limited Waiver of Penalty to Allow Time to 'True-Up' Estimates
Excerpt: "The Pension Benefit Guaranty Corporation (PBGC) has issued final regulations that provide for a limited waiver of the penalty for failure to pay premiums to allow large and mid-size plans time to 'true-up' estimated premium payment liabilities. Interest during the 'true-up' period, however, is not suspended." (Wolters Kluwer)

NFL Retirement Plan Amendment Reduces Pension Payout to Participants
Excerpt: "An amendment made to the Bert Bell/Pete Rozelle NFL Player Retirement Plan, which was made effective April 1, 2007, reduces the monthly pension benefit of plan participants who elect the Qualified Joint and Survivor Annuity Option or the Life and Contingent Annuitant Pension Option. The reduction can be as large as a 6.3% decrease of the monthly benefit." (RetiredPlayers.Org)

Retirement Risks to Consider
Excerpt: "Retirement usually presents a new beginning and new opportunities. At the same time there are risks you must be aware of so you can have a great game plan. Know the pitfalls, and you can better plan for the unexpected." (Zacks Investment Research)

Economic Downturn Leading Seniors To Delay Retirement
Excerpt: "The Wall Street Journal on Tuesday examined how falling real estate and stock markets have led many U.S. seniors to delay retirement. Economists and demographers recently have begun expecting a 'huge exodus from the work force' as the first baby boomers reached age 60 in 2006. However, investment advisers and retirement planners at numerous financial firms are 'seeing large numbers of older workers put off retirement as the housing and stock market troubles have deepened,' the Journal reports." (Kaiser Family Foundation)

IRA Hardship Loans Sought
Excerpt: "So-called hardship loans from individual retirement accounts would be permitted under a bill introduced last month. The IRA Assistance Act of 2008 (HR 5641), co-sponsored by Reps. Thaddeus McCotter, R-Mich., and Ron Paul, R-Texas, would allow hardship loans from IRAs -- but not Roth IRAs -- for qualifying situations as determined by the Internal Revenue Service under current law . . . ." (Investment News; free registration required)

In Argentina, Retirement Benefits and Contributions to Social Security Increased
Excerpt: "Employers must withhold more social security contributions from employees' paychecks according to a presidential decree of February 21, 2008. The decree also set new maximum and minimum levels for retirement benefits paid by the government." (Watson Wyatt Worldwide)

International Social Security Update, March 2008
Excerpt: "International Update is a monthly publication of the Social Security Administration's Office of Retirement and Disability Policy. It reports on the latest developments in public and private pensions worldwide." (U.S. Social Security Administration)

Court Gives Delphi Extensions on GM, Pension Deals
Excerpt: "Judge Robert Drain allowed Delphi to extend until April 15 an agreement that allows it to transfer billions of dollars of union pension liabilities to former parent GM. The agreement was to expire on Monday." (Reuters)

Borrowing from 401(k) Accounts Can Be a Bad Deal All Around
Excerpt: "The subprime crisis and its many ripple effects are prompting more financially strapped homeowners to borrow from their 401(k) plans. That not only puts their long-term fiscal health in jeopardy, but also places a large burden on their employers." (

Why the Experts Put Their Pensions in Russia
Excerpt: "EVEN the most adventurous of us might baulk at investing our pension in Chinese property or Russian equities, but that's where leading pension experts are putting their retirement savings." (Times Newspapers Ltd.)

CSRS Employees Ask - Should I Deposit Money to Cover Earlier Temporary Federal Employment?
Excerpt: "HR folks refer to this as 'deposit service'. That is service, usually early in your career, where CSRS retirement deductions were not taken from your pay. This service might have been as a seasonal postal worker when in college (mine was), or time spent in some types of temporary employment. At that time there was no expectation on your part, or on the government's part for that matter, that you would sometime later become a federal employee who would ultimately retire from federal service." (FedSmith Inc.)

Alabama's DROP Program Pays Big Dividends to Some Educators
Excerpt: "Under DROP, employees keep working at full salary and benefits while the monthly retirement benefit they would have received if they quit working is deposited into a savings account. The employee's monthly retirement contribution is also deposited into the account, and interest is paid at 4 percent on all funds. After three to five years, the employee can retire and take all the money in the DROP account." (The Dothan Eagle)

Europe Takes a Closer Look at Employee Stock Ownership
Excerpt: "[G]overnments in Austria and Germany are devising legislation that takes inspiration from pioneers like Voestalpine, and they are using tax law to encourage employee stock ownership. More stock in the hands of workers could help compensate for wages that have stagnated in much of Europe even as stock markets have staged a long-term rally, the recent turmoil notwithstanding. The politics are appealing as well." (The New York Times; free registration required)

The LaRue Decision: A Mountain of Individual ERISA Lawsuits or Not?
Attorneys David Johanson and Michael Pasahow discuss the LaRue v. DeWolff, Boberg & Associates decision and its implications for plan sponsors and plaintiffs. (National Center for Employee Ownership)

[Opinion] Some Quirks About QDROs
Excerpt: "The First Circuit just got into the act at the end of last week, with a detailed ruling on the collision of QDROs, retirement benefits, divorce proceedings, and jurisdictional issues. To me, the most interesting aspect of the case concerns the court's discussion of the power of the state probate court to resolve this issue, and the court's suggestion that a parallel, but separate, federal action over the enforcement and interpretation of a QDRO is, at a minimum, not an approach the court favors." (Stephen Rosenberg of The McCormack Firm, LLC)

[Opinion] Testimony of Robert Chambers on Behalf of American Benefits Council before DOL Hearing on Proposed 408(b)(2) Regulations (PDF)
Excerpt: "As drafted, the proposed regulation would apply broadly to defined contribution plans, defined benefit plans, and health and welfare plans. We urge you to finalize the proposed regulations in three separate tranches or components - - first, disclosure for defined contribution plans; second, for defined benefit plans; and finally for health and welfare plans." (American Benefits Council)

Sponsored by: International Foundation of Employee Benefit Plans

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Banner ad for International Foundation of Employee Benefit Plans

Celebrate National Employee Benefits Day on April 2, 2008!

The International Foundation of Employee Benefit Plans is once again leading the celebrations for National Employee Benefits Day. This year the day has a special focus on health care literacy. The Foundation is encouraging those who are involved in employee benefits to use the day to educate themselves and their plan participants. Visit for free informational resources to help you plan your celebration!

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

Links to Items on Executive Comp, Benefits in General

Executive Compensation at Largest U.S. Companies
Excerpt: "The Wall Street Journal has partnered with Hay Group for an ongoing look at annual executive compensation at the largest public U.S. companies. Use this sortable chart to see which CEOs earn what." (The Wall Street Journal)

Tuition-Reimbursement Programs - A Case Study of a Company That Does It Right
Excerpt: "Tuition-reimbursement plans are often justified by their value in enhancing employee retention and recruitment, but few companies have put that hypothesis to the test. A recent survey of 180 companies conducted by the Corporate University Xchange (CUX) found that nearly half neither measure the impact of such programs on retention and recruitment nor follow up with employees and managers to learn how the programs affect job performance." (

Day Care's New Frontier: Your Baby at Your Desk
Excerpt: "More than 80 companies across the nation allow babies in the workplace, according to Parenting in the Workplace Institute in Framingham, Mass., which says that number is likely to be low. It's an extreme -- and controversial -- example of how employers are seeking more ways to help workers strike a balance between work and the rest of their lives. The number of companies allowing children at work on an occasional basis climbed to 29% last year, up from 22% in 2006, according to the Society for Human Resource Management." (USA TODAY)

Newly Posted Events
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Retiree Medical Benefits After Erie County: HIPAA, ADEA, Medicare Coordination and ERISA Compliance Issues
Nationwide on April 24, 2008
presented by ABA Joint Committee on Employee Benefits

Newly Posted Press Releases
(Post Yours!)

PBGC Protects Aladdin Industries LLC Pension Plan
Pension Benefit Guaranty Corporation (PBGC)

PBGC-Negotiated Agreement Secures Pension Funding As Ampex Corp. Enters Chapter 11
Pension Benefit Guaranty Corporation (PBGC)

Council Emphasizes Importance of ERISA, Urges Court to Strike Down San Francisco Law
American Benefits Council

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DB Implementation Specialist
for Milliman
in TX

Defined Contribution Consultant
for Callan Associates
in CA, IL

Daily Valuation Recordkeeper
for PensionTrend, Inc
in MI

Small Plan Actuarial Consultant
for Pension Planning Consultants, Inc.
in NM

Defined Contribution Plan Administrator
for Pension Planning Consultants, Inc.
in NM

Retirement Plan Administrator
for LarsonAllen
in MN

Pension Administrator
for Envoy Financial
in CO

ERISA Consultant
for Ascensus
in MN

Employee Benefits Service Coordinator
for Growing Financial Services Firm
in TX

Client Relationship Manager
for Great-West Financial Services
in OR

Defined Contribution Administrator
for Pension Funds of Arizona
in AZ

Sr Compliance Analyst - ERISA
for T Rowe Price
in MD

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