Retirement Plans Newsletter
January 26, 2010

To BenefitsLink home page
Click to view employee benefits jobs:

Fill your job openings fast on!

EFAST2! Ready...Set…Go!

EFAST2! Ready...Set…Go!

Our preparation software and web portal for e-signatures are fully certified and available for use. You cannot afford to delay! has everything that you need for preparation of your 5500s as well as a web-portal for e-signatures. We also provide free webinars to get you up to speed on EFAST 2 and learn how to use our software. Got questions? Just call us at 800.596.0714 or email

[Guidance Overview]
How to Recharacterize an IRA Contribution

Excerpt: "Recharacterization of an IRA contribution means treating a contribution made to one type (traditional or Roth) of IRA as made to a different type of IRA for the taxable year. An individual may recharacterize all or a portion of an IRA contribution. A taxpayer may recharacterize a contribution made either to a traditional IRA or to a Roth IRA." (SunGard Relius)

[Guidance Overview]
When Does Pension Fund's Law Firm Stop Being Merely a Professional Legal Adviser and Instead Become a Fiduciary Under ERISA?

Excerpt: "U.S. District Judge Stephen J. Murphy III ruled that the Southfield, Michigan-based Sullivan, Ward, Asher and Patton, P.C., law firm could be found to have become an ERISA fiduciary if a union pension fund's allegations against it were ultimately proven. Among the charges: that the law firm made several key decisions on legal matters concerning the pension fund -- including a lawsuit settlement offer in a suit against consultant Watson Wyatt -- without consulting the fund's trustees." (

Proposal for Cuts to Colorado State Pension Fund to Be Heard Today
Excerpt: "A proposal that calls on current and future government workers to make sacrifices to save their pensions is up for a hearing today. . . . Senate Bill 1 calls for raising the retirement age, reducing or eliminating cost of living raises, and increasing contributions from employees and their employers, the taxpayers." (The Denver Post)

House Financial Services Committee Chairman Weighs Bill Requiring Investors to Reveal Proxies
Excerpt: "House Financial Services Committee Chairman Barney Frank (D-Mass.) is considering a bill that would require mutual funds, pension plans and other large institutional investors to publicly reveal how they vote their proxies, to impose proper corporate governance on otherwise passive investors who, seemingly, don't vote in the fiduciary interest of their end investors. 'If you are the owner of shares, you have a privacy right,' Frank said at a hearing on financial services compensation. 'But if you own shares on behalf of a fiduciary, you will need to disclose how you vote.'" (Money Management Executive via On Wall Street)

The Effect of Uncertain Labor Income and Social Security on Life-Cycle Portfolios
Excerpt: "This paper examines how labor income volatility and social security benefits can influence lifecycle household portfolios. We examine how much the individual optimally saves and where, taking into account liquid financial wealth and annuities, and stocks as well as bonds. Higher labor income uncertainty and lower old-age benefits boost demand for stable income in retirement, but also when young. In addition, a declining equity glide path with age is appropriate for the worker with low income uncertainty; for the high income risk worker, equity exposure rises until retirement. We also evaluate how differences in social security benefits can influence retirement risk management." (National Bureau of Economic Research; paid subscription or individual purchase required to retrieve fulltext)

Federal Court Approves 401(k) Settlement Involving Hartford Life
Excerpt: "The settlement, whose financial terms were not publicized, involves the administrators of all 401(k) plans that used Hartford Life Insurance Co. as a full-service provider to design, implement, administer or assist in the administering of their 401(k) plans since Nov. 14, 2003, according to a statement from Shepherd, Finkelman, Miller & Shah, a law firm involved in the case." (New Horizon Group, Inc. :: Insurance & Financial Advisor)

Why the 401k Will Prevail: Innovations in Retirement in 2010
Excerpt: "[The target page is a discussion on] how the 401(k) program will continue to adapt and improve to meet the needs of the American workforce. The positive effects introduced by the Pension Protection Act of 2006 will be complemented by assured income products, increased fee transparency, and extended coverage to more Americans." (Profit Sharing / 401k Council of America via Scribd)

Obama Administration Unveils Retirement Security Initiatives
Excerpt: "A year ago, President Obama appointed a Task Force on the Middle Class. On January 25, 2010, after a year of meetings held all over the country, the Task Force gave a preview of elements of their recommendations (the full report will be released in February). In the section on retirement security, they laid out several proposals . . . ." (

12 Traps to Avoid When Converting to a Roth IRA
Excerpt: "'Roth conversions can trigger unintended tax traps and financial problems that are not being addressed in the mounds of 2010 Roth conversion information that currently dominates the media,' Ed Slott wrote recently in his newsletter, 'Ed Slott's IRA Advisor.' These traps may make you reconsider when to convert, how much to convert, or even if you should convert at all. Here are some of the traps that Slott says await the uninformed." (MarketWatch, Inc.)

Suggested Useful Provisions in Your Individually-Designed Retirement Plan Document
Excerpt: "While small companies may need to use pre-approved documents because of cost considerations, mid-size and larger companies should consider drafting documents to meet their needs. When my law firm is hired by a plan sponsor, one of our first steps is to review the plan documents. Over the years, we have developed a checklist for doing that. This article describes three of the items on the checklist." (Fred Reish via

Increase Predicted for 2010 Workplace Litigation by Report from Seyfarth Shaw
Excerpt: "Six key trends from the report are epitomized by the firm as follows: First, the plaintiffs' bar increased the pace of the Fair Labor Standards Act ('FLSA') collective action and the Employee Retirement Income Security Act ('ERISA') class action filings seeking recovery for unpaid wages and 401(k) losses. As lay-offs increased, displaced workers also filed more age discrimination and Worker Adjustment and Retraining Notification lawsuits. Even more litigation is expected in 2010, as businesses re-tool their operations." (Roy Harmon III via Health Plan Law)

Federal Employees: Pay and Pension Increases Since 1969 (PDF)
14 pages. Excerpt: "Increases in retirement benefits for retired federal employees were first linked to the CPI by law in 1962. Increases in Social Security benefits have been linked by law to changes in the CPI since 1973. Before then, Congress periodically adjusted Social Security benefits through legislation. Congress chose to tie increases in these benefits to the CPI to make the process less subject to political influences." (U.S. Congressional Research Service via OpenCRS)

New Jersey Senate Proposes Pension Reform Package Abandoned by Former Governor
Excerpt: "The proposed changes include repealing a 9 percent increase in benefits put in place in 2001, increasing from three to five the number of years of salary factored into the pension, banning part-time workers from the pension plan and switch to a defined contribution plan, and allowing non-vested public employees to switch out of the pension system and into a defined contribution plan, or opt out completely." (New Jersey On-Line LLC)

Underfunded Pensions and the Issue of Executive Compensation

Excerpt: "Obviously, out in the political atmosphere, these two things -- PBGC liability and executive compensation -- are connected somehow, but is there a logic to that connection?" (

Special Offer With Your Preorder of The ERISA Outline Book, 2010 Edition

Special Offer With Your Preorder of The ERISA Outline Book, 2010 Edition

Valued by every practitioner and recommended for every ERPA candidate, the ERISA Outline Book, 2010 Edition by Sal L. Tripodi, J.D., L.L.M. offers six volumes of vital information on everything you need to know. Highlights include: IRS guidance on the waiver of 2009 required minimum distribution; automatic enrollment guidance from the IRS and Treasury; guidance on discontinuing safe harbor nonelective contributions; EFAST2 electronic filing system and DOL guidance; reporting guidance for 403(b) plans, guidance on deferrals from paid time off plans, court cases on scrivener's errors, and over 100 new rulings, guidances and regulations affecting retirement plans.

Order your copy today and receive the 2009 Online Edition, valued at $535, for only $200! Visit to order now!


Executive Compensation; Benefits in General

[Guidance Overview]
IRS Issues Question-and-Answer Guidance Addressing Heart Act Changes

Excerpt: "EBIA Comment: While some of the issues addressed in this guidance were previously understood, it offers welcome clarity in other gray areas. Those working with plans that cover employees who are on active military duty will want to review it carefully. [T]he notice provides that plan amendments for certain provisions that are permissive (HEART Act Sections 104(b) and 107) need not be adopted until the last day of the first plan year beginning on or after January 1, 2010 (that is, the same remedial amendment period that applies to the HEART Act's mandatory provisions)." (Employee Benefits Institute of America)

Top 10 Employee Handbook Updates to Make in 2010
Excerpt: "It is essential that employers seek counsel before making changes to their handbooks. There is no one-size-fits-all employee handbook and not all employers are required to implement all employment laws depending on their size and location. In addition, when employers consider adapting or adopting new policies, they should make sure employees are aware of the changes, obtain signed acknowledgement forms from employees, and implement the new policies uniformly." (Michael Best & Friedrich LLP)

The Great Recession and the State and Local Government Workforce
Excerpt: "Hiring freezes, pay freezes, layoffs, and furloughs top the list of ways that local and state governments are cutting costs, according to a Center for Excellence online survey of government managers. States and local governments also have made significant changes in their benefit offerings." (Center for State and Local Government Excellence)

Fact Sheet: Obama Middle Class Reform Proposals, Including Savings Initiatives (PDF)
4 pages. Excerpt: "There are immediate steps we can take to reduce the strain on family budgets by helping middle class families manage their child and elder care responsibilities, save for retirement, and pay for college. A year ago, President Obama appointed a Task Force on the Middle Class, naming Vice President Joe Biden as its chair. After a year of meetings held all over the country, today we are previewing elements of the recommendations of the Middle Class Task Force (the full report will be released in February)." (American Benefits Council)

Examining the Impact of Obama's Proposals for Dependent Care and Retirement Savings
Excerpt: "Among other things, they would expand the dependent care tax credit for families making up to $115,000 a year, restructure the saver's credit so more people can get it and require employers who don't offer a 401(k) plan to enroll their employees in a direct-deposit Individual Retirement Account." (San Francisco Chronicle)

Webcasts and Conferences

2010 Health Benefit Plan Compliance Update: Navigating the Maze of New Laws
Nationwide on February 25, 2010
presented by MCOL

Executive Compensation: Strategy, Design, and Implementation
in New York on June 17, 2010
presented by ALI-ABA (American Law Institute-American Bar Association)

Pension, Profit-Sharing, Welfare, and Other Compensation Plans
in California on March 17, 2010
presented by ALI-ABA (American Law Institute-American Bar Association)

(Click to post your webcast or conference)

Press Releases

PBGC Protects Pensions at Fluid Routing Solutions Inc.
Pension Benefit Guaranty Corporation (PBGC)

Benefit Software Inc. Announces Results of Ninth Annual Client Employee Online Enrollment Satisfaction Survey
Benefit Software Inc.

ACLI Lauds Administration For Plans To Help Americans Secure Their Retirements
American Council of Life Insurers

State and Local Governments Cut Personnel and Benefits
Center for State and Local Government Excellence

U.S. Retirement Partners Acquires Florida Firm
U.S. Retirement Partners

McGraw Wentworth Survey to Benchmark Employee Benefit Trends Among 600+ Michigan Employers
McGraw Wentworth

New York Life Replaces Retirement Plan Services Head
New York Life Retirement Plan Services

(Click to post your press release)

Click to post your job on

Newly Posted Employee Benefits Jobs

Plan Administrator/Trust Accountant
for Thomas F. Barrett, Inc.
in MD

Client Service Manager
for Ascensus
in MN

Business Logistics Consultant
for Lincoln Financial Group
in IN

Project Management Leader
for Federal Retirement Thrift Investment Board
in DC

Internal Wholesaler (Sales Specialist)
for The Standard
in OR

Director, Learning and Development
for Prudential
in NJ

Relationship Manager
for Huntington National Bank
in OH, PA

(Click to post your job on | View all jobs | RSS feed for jobs RSS feed of all jobs )

Fill your employee benefits job openings fast!

Where the best employers find the best candidates!

Click to post your job on

Handy Links:

Subscribe to the BenefitsLink Health & Welfare Plans Newsletter, Too!

Sign-up form is at (free).

This email has been published by:, Inc.
1298 Minnesota Avenue, Suite H
Winter Park FL 32789
(407) 644-4146
Fax: (407) 644-2151

Jeanette Hull, News Editor

David Rhett Baker, J.D., Editor and Publisher

Copyright 2010, 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:

Other useful links: