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October 31, 2008

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

Today's sponsor is DATAIR Employee Benefit Systems, Inc.

(Click on company name or banner to learn more.)
Banner ad for DATAIR Employee Benefit Systems, Inc.

DATAIR’s TWO for ONE sale*

DATAIR provides the best TPA software, with the best support, at the best price. Choose just the modules you need:
  • DC/401(k) Proposal and Administration System
  • DB Proposal and Administration System
  • Pension Reporter System – 5500/SAR/PBGC series, 5300 series, 1099R
  • Document System – Prototype and Volume Submitters plus Cash Balance and 403(b)
  • Cafeteria and HRA Administration and Document Systems
*Limited time offer: Pay one license fee and get two DATAIR 12 months 0% financing with 20% down. Restrictions apply, contact DATAIR’s sales department:   (888) 328-2474

[Guidance Overview] Do You Need to Send an Annual Notice to Plan Participants? If So, You May Need to Do So by December 1, 2008 (PDF)
Excerpt: "Several years ago, the IRS introduced us to the concept of annual notices by requiring plan sponsors of 401(k) safe harbor plans to issue an annual notice to participants. Today, the number of annual notice requirements has increased. This advisory focuses on typical annual notices that defined contribution plans must issue to participants." (Alston + Bird LLP)

[Guidance Overview] Does Your Qualified Retirement Plan Need to Be Amended This Year? (PDF)
Excerpt: "Recent IRS guidance has reminded plan sponsors of deadlines for amending qualified retirement plans. Some amendments must be completed by December 31, 2008 (for calendar-year plans). Others must be completed by January 31, 2009 (for Cycle C plans). Still others must be completed by the deadline for filing the plan sponsor's 2008 tax return ('interim' amendments). This advisory identifies those plans that must be amended now or in the near future." (Alston + Bird LLP)

[Guidance Overview] FASB Increasing Pension Disclosure Requirements, Contrary to Staff Recommendation
Excerpt: "The board decided Wednesday that the final staff position will be effective for fiscal years ending after Dec. 15, 2009, one year later than originally envisioned, with early application permitted." (Attorney B. Janell Grenier on BenefitsBlog)

James LaRue, Though Successful in Supreme Court, Voluntarily Dismisses His Lawsuit
Excerpt: " A Texas management consultant, whose lawsuit over 401(k) fiduciary breach allegations became the subject of a landmark U.S. Supreme Court on participants' legal rights, has apparently run out of money to fund further proceedings." (

Experts Push for Greater Relief on DB Accrual Rules at IRS Hearing
Excerpt: "While the IRS and Treasury have recently given defined benefit plans a break on their Code Sec. 411 accrual requirements, some practitioners feel that the agencies could go further in these efforts. Testifying at an October 15, 2008 public hearing . . . ." (Wolterks Kluwer Law & Business)

Should a Demand for Change Include 401(k) Plans?
Excerpt: "A number of economists are calling for changes to the current 401(k) savings system. Some proposals wouldn't affect workers much while others would force everyone to save and would have broad impact on the retirement planning industry." (AP via Forbes)

Defined Benefit Pension Funds Weakened by Stock Market Decline
Excerpt: "With the stock market shedding more than a third of its value this year, pension funds at big companies have been battered beyond recognition. What looked like safe stowaway spots where corporations securely tucked away assets for their employees' retirements now look like roller-coaster funds." (

Current Financial Crisis Might Pale in Comparison to Looming Social Security Liability
Excerpt: "[T]he deteriorating financial condition of our federal government in the face of skyrocketing health-care costs and the baby-boom retirement could fairly be described as a super-subprime crisis. It would certainly dwarf what we're seeing now." (by David M. Walker, former Comptroller General, on CNN Money)

[Opinion] Retirement Plan Policy Changes Needed? First, Do No Harm to 401k Plans
Excerpt: "Americans aren't pension-poor because of the stock market but because of the typical employer match of 3%. Of the eight countries in the advanced world using defined contribution plans the US rate is the second lowest-even Mexico's employers have to contribute 6% of pay." (Jane White on

[Opinion] Public Pensions Place Undue Burden on Staggering Economy
Excerpt: "The ticking time bomb of overpromised, underfunded public pension plans has finally exploded. Here are a few articles to consider: . . . The above is just a random sampling of hundreds of articles about pension plan woes. 40% of pension plans are underfunded - and that assumes future returns of 8% annually. Good luck with that." (Minyanville)

[Opinion] Pension Freezes by Public Employers Can Have Harmful Consequences
Excerpt: "The research finds that freezing a DB plan and moving to an individual defined contribution (DC) plan can increase costs to employers and/or taxpayers due to higher costs of operating two plans, erosion of economic efficiencies, and front-loaded contribution requirements; and further exacerbate retirement insecurity concerns, which in turn can hamper worker recruitment and retention effort, result in higher turnover rates, create labor shortages, increase training costs, and lower productivity levels." (National Institute on Retirement Security)

Sponsored by: WorldatWork

(Click on company name or banner to learn more.)
Banner ad for WorldatWork

WorldatWork publications in the BenefitsLink Bookstore

WorldatWork, a not-for-profit professional association, is a leading publisher of compensation, benefits and total rewards information. With a portfolio of books, reports, survey briefs, booklets and online learning programs, WorldatWork creates, markets and distributes publications that are critical to improved organizational performance. WorldatWork has contributed to the education and development of business professionals worldwide since 1955.

(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

IRS Seeks Applications for TE/GE Advisory Committee (PDF)
1 page. 2 vacancies for persons representing the Employee Plans customer segment. Excerpt: "The Internal Revenue Service seeks applications for vacancies on the Advisory Committee on Tax Exempt and Government Entities (ACT), which provides the IRS with public comments regarding critical tax administration matters." (Internal Revenue Service)

[Official Guidance] Text of Federal Register Notice with Further Details About IRS TE/GE Advisory Committee Vacancies
Excerpt: "ACT members shall be appointed by the Secretary of the Treasury and shall serve for two-year terms." (Internal Revenue Service)

[Guidance Overview] Discovery Responses Did Not Support Removal and ERISA Preemption in State Law Wrongful Discharge Case
Excerpt: "Plaintiffs walk a fine line when asserting claims under the ADA and state wrongful discharge laws. This recent district court opinion exemplifies a successful avoidance of ERISA preemption, but not without the trouble of removal and remand. The problem lies in the natural consequence of termination. Aside from loss of wages and compensation benefits, the plaintiff will lose participation in employee benefit plans." (Attorney Roy F. Harmon III on Health Plan Law Blog)

Newly Posted Events
(Post Yours!)

401(k) Trends and Hot Topics
in California on November 20, 2008
presented by Western Pension & Benefits Conference - Orange County Chapter

Newly Posted Press Releases
(Post Yours!)

Innovative Collaboration Creates Largest Online Library Of University Teaching Materials on Employee Ownership
ESOP Association

Fidelity Investments Reports Nearly Half Of 61 Year-Olds Plan To Start Taking Social Security As Soon As Eligible
Fidelity Investments

Benefit Informatics Integrates HealthMedia Behavior Change Intervention Programs into Desktop Services
Benefit Informatics

Pension Freezes Can Increase Costs, New Research Brief Warns
National Institute on Retirement Security

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Employee Benefits Administration
for Primary Consulting, Inc.

Assistant Director - Medical Claims
for 1199SEIU Family of Funds
in AL, NY

Investment Consultant
for The Newport Group
in FL

Manager, Benefits Finance
for TimeWarner Corporate
in NY

Pensions Relationship Consultant
for Nationwide
in NC

Senior Pension Consultant
for Boutique firm in Albuquerque, NM
in NM

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