Retirement Plans Newsletter |
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| October 28, 2009 \ Compliance \ Costs \ Administration \ Design \ Policy | ||
ASC (Advert.)
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[Guidance Overview]
Purchasing a Participant's ESOP Stock With a Promissory Note: Is Your 'Adequate Security' Really Adequate?
Excerpt: "There is very little case law regarding 'adequate security' when a promissory note is used to purchase the stock distributed to a participant from an ESOP. In a 1995 case /3/, former ESOP participants claimed ESOP Trustees had breached their fiduciary duty by purchasing stock from participants with a promissory note secured by a pledge of the stock. The lower court easily found this was not a breach of fiduciary duty, and ruled in favor of the Trustees. On appeal, the Appeals Court sent the case back to the lower court for further proceedings, finding that the facts might have given rise to a breach of fiduciary duty. There are no further reported proceedings for the case." (Warner Norcross & Judd LLP)
[Guidance Overview]
Effects of the 401(k) Fair Disclosure and Pension Security Act (PDF)
3 pages. Excerpt: "This article discusses how employers providing 401(k) plans to their employees will be affected by the 401(k) Fair Disclosure and Pension Security Act of 2009 in the realm of fee disclosure under legislation currently pending in the U.S. House of Representatives. There are other provisions of the proposed legislation, including the provision of investment advice, which are not discussed here." (New York Law Journal via Patterson Belknap Webb & Tyler LLP)
Public Employee Retirement System Investments, 1993, 1995, 1997 and 2009 (PDF)
Excerpt: "Recommendation. The Government Finance Officers Association (GFOA) recommends that fiduciaries adhere to the following best practices regarding investments: 1. Pension fund fiduciaries should establish a written investment policy that lays out formal policies and procedures to regulate and monitor the system's investment program. The investment policy should: establish the objectives of the investment program; define acceptable risk; establish liquidity requirements at a level that does not compromise the system's cash flow needs; describe diversification requirements; comply with applicable state and local statutes." (Government Finance Officers Association of the United States and Can.ada)
Pension Funding Relief Bill Makes Congressional Debut
Excerpt: "Rep. Earl Pomeroy, D-North Dakota, introduced a bill Tuesday, October 27, that would give businesses some breathing room from the strict funding rules imposed by a landmark pension reform bill than went into effect last year. . . . 'Without additional action, January 1, 2010, will bring to bear very significant additional funding requirements,' said Pomeroy, a member of the House Ways and Means Committee. 'This is going to put extraordinary pressure on companies to freeze their pension plans.'" (Workforce Management; free registration required)
Working Longer, Reducing Withdrawals, Buying Annuities Improves Retiree Savings
Excerpt: "In its October 2009, issue of ThoughtCapital, Principal suggested a number of ways that someone approaching retirement can postpone the depletion of his or her retirement portfolio beyond the 14-year period caused by poor market performance in the early years of retirement. First, scaling down retirement spending from 4% to 2%, adjusted for inflation, would help sustain retirement income from 14 to 30 years. Second, delaying retirement by five years would help sustain retirement income from 14 to 23 years, assuming that the retirement spending rate stayed at 4%, adjusted for inflation. . . . For more information, including the assumptions used to arrive at these conclusions, visit http://www.principal.com/about/news/research.htm." (Wolters Kluwer)
Fact Sheet on the Preserve Benefits and Jobs Act Introduced by Congressmen Earl Pomeroy and Pat Tiberi (PDF)
1 page. Excerpt: "Congressman Pomeroy and Tiberi believe Congress should pass reasonable pension funding relief to keep employees working and give them security in knowing their pensions will be there when they need them." (American Benefits Council)
Section-by-Section Summary of the Preserve Benefits and Jobs Act As Proposed by Pomeroy-Tiberi (PDF)
3 pages. (American Benefits Council)
What Sponsors and Advisors Should Know About Retirement Plans
Excerpt: "According to a 2007 U.S. Labor Dept. survey, 68% of small business owners feel unprepared for retirement and just 42% maintain a retirement plan. Here are four frequently overlooked tips about retirement plans for plan sponsors and their advisors." (BusinessWeek)
Personality, Lifetime Earnings, and Retirement Wealth
Excerpt: "Lifetime earnings vary widely, even controlling for education. Households vary widely in their retirement wealth, even when controlling for lifetime income (Venti and Wise, 1998). The role of conscientiousness and other personality traits as independent factors in labor market outcomes early in the life cycle has recently been demonstrated (Borghans, Meijers, & Ter Weel, 2008 ). We propose to examine the association between personality measures assessed near or past the end of work life with lifetime labor market outcomes, and with retirement saving conditional on lifetime earnings, using data from the HRS and the linked Social Security administrative records." (University of Michigan Retirement Research Center)
Congress Will Consider Option for Federal Workers to Contribute Unused Leave Toward Retirement Account
Excerpt: "Many federal employees lately have been thinking a lot about saving for retirement. One idea currently being kicked around inside the Beltway is allowing government workers to roll their unused annual leave into their Thrift Savings Plans. President Barack Obama endorsed the idea during his Labor Day radio address in September. 'The rules ought to be written to encourage people to save instead of discouraging them,' he said. . . . Congress currently is considering a separate proposal to allow workers in the Federal Employees Retirement System to count their unused sick leave toward their retirement annuities. That legislation affects only the defined retirement benefit portion of FERS, not the TSP, which operates as a defined contribution plan." (GovernmentExecutive.com)
House Members Introduce Pension Funding Relief Measure
Excerpt: "U.S. House Representatives Earl Pomeroy (D-North Dakota) and Pat Tiberi (R-Ohio) have introduced a bill to further ease funding requirements for defined benefit plan sponsors. The Preserve Benefits and Jobs Act expands pension funding relief provided in the Worker, Retiree and Employer Recovery Act (WRERA) in 2008 and the Department of the Treasury regulatory guidance for 2009 reducing employer contributions. The Congressmen said the funding relief would continue worker and retirees' protections against pension benefit accruals being frozen in 2009 and 2010, as enacted by WRERA, and would protect future retirees by prohibiting pension plans from being drained by lump sum ad hoc benefits to certain individuals." (PLANSPONSOR.com; free registration required)
EBSA Webcast to Address Form 5500 Issues
Excerpt: "[T]he Department of Labor's Employee Benefits Security Administration (EBSA) says that an important part of the discussion will focus on the Schedule C and the impact on 403(b) plans. The U.S. Department of Labor's Employee Benefits Security Administration (EBSA) says it will host a free webcast November 5 to help employers, plan administrators and service providers prepare for changes to the Form 5500 and electronic filing requirement that begin with the 2009 plan year filings. According to the announcement, this third webcast will provide more details about preparing the Form 5500 and getting ready for the new electronic filing system. In addition, EBSA staff will address questions received from the public and provide practical tips for using the new ERISA Filing Acceptance System - known as EFAST2. EFAST2 will receive only electronic filing submissions. The Web cast is scheduled for November 5 from 2:00 to 4:00 p.m. EST. Registration is required and available on a first-come, first-served basis. You can so do at http://www.dol.gov/ebsa . . . ." (planadviser)
DATAIR Employee Benefit Systems, Inc. (Advert.)
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Links to Items on Executive Comp, Benefits in General
[Guidance Overview]IRS Will Be Auditing Company Employment-Tax Practices Beginning in February
Excerpt: "The Internal Revenue Service will be conducting detailed employment-tax examinations of some 6,000 companies beginning in February, the agency has announced. These auditing initiatives are being carried out, the IRS maintains, to gather statistical data for its first National Research Program study of employment tax compliance in about 25 years. The likely reason for resurrecting this particular focus is that a study of the tax gap -- the difference between the amount of taxes collected and the amount owed -- done in 2005 showed that employment taxes, after underreporting of income by individuals, was the second-largest contributor to the tax gap . . . ." (Human Resource Executive Online)
TARP Special Master Cuts Executive Pay
Excerpt: "Steep pay cuts will have to take place at the seven companies receiving exceptional TARP assistance -- AIG, Citigroup, Bank of America, Chrysler, General Motors, GMAC and Chrysler Financial -- Kenneth Feinberg, special master for TARP executive compensation, has ruled. While the pay curbs affect a limited number of employees and employers, the underlying compensation principles may draw wider attention from other regulators and stakeholders." (Mercer LLC)
IRS Personnel Share Unofficial Comments on Compliance Issues with ABA Employee Benefits Committee
Excerpt: "IRS representatives shared their unofficial views on certain benefits issues that were presented earlier this year by the Employee Benefits Committee of the Tax Section of the American Bar Association. Although the views cited by the IRS representatives are not binding and do not represent the policy of the agency, they provide useful insight into areas of concern. Some of the notable unofficial and non-binding views shared by the IRS representatives were the following . . . ." (Deloitte via BenefitsLink.com)
Webcasts and Conferences
"EFAST2: The Future of Form 5500" in Dallasin Texas on December 3, 2009
presented by SunGard Relius
"EFAST2: The Future of Form 5500" in Houston
in Texas on December 8, 2009
presented by SunGard Relius
"EFAST2: The Future of Form 5500" in New York
in New York on December 3, 2009
presented by SunGard Relius
"ERISA Workshop" in Dallas
in Texas on December 4, 2009
presented by SunGard Relius
"ERISA Workshop" in New York
in New York on December 4, 2009
presented by SunGard Relius
"Impact of the Genetic Information Nondiscrimination Act (GINA) on Group Health Plans" - Complimentary
Nationwide on October 27, 2009
presented by Gallagher Benefit Services, Inc.
"Plan Forms, Notices, and Amendments: Streamlined, Effective, Timely" in Dallas
in Texas on December 3, 2009
presented by SunGard Relius
"Plan Forms, Notices, and Amendments: Streamlined, Effective, Timely" in Houston
in Texas on December 8, 2009
presented by SunGard Relius
"Plan Forms, Notices, and Amendments: Streamlined, Effective, Timely" in New York
in New York on December 3, 2009
presented by SunGard Relius
Getting Ready for 2009 Form 5500 and Electronic Filing, Part III Webcast
Nationwide on November 5, 2009
presented by U.S. Department of Labor, Employee Benefits Security Administration (EBSA)
(Click to post your webcast or conference)
Press Releases
Prudential Launches 'Redefining Retirement' DC Plan ModelPrudential Financial, Inc.
Teamsters Commend Bipartisan Bill on Pension Reform to Protect Workers
International Brotherhood of Teamsters
IBI Research Suggests the Health of U.S. Workforce is in Dire Straits
Integrated Benefits Institute
Sentinel Financial Adds vWise SmartPlan Enterprise to its Participant Platform
vWise Inc.
Congress Encouraged to Protect Working Families and Flexible Spending Accounts in New Advertising Campaign
Save Flexible Spending Plans
Sunwest Pensions Achieves SAS-70 Certification for Daily Advantage Recordkeeping Platform
Sunwest Pensions
(Click to post your press release)
Employee Benefits Jobs
Retirement Plan Marketing Consultantfor Loren D. Stark Company, Inc.
in TX
Education & Enrollment Specialist
for Prudential
in WA
Vice President & Actuary
for Prudential
in CT
Pension Administrators
for Randstad
in FL
Investment Specialist
for Fiduciary First
in FL
(Click to post your job opening | View all jobs |
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