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Retirement Plans Newsletter

July 28, 2010

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The DOL announced interim final regulations for service provider fee disclosure. Hear details and analysis from our panel of ERISA experts. Our agenda will reflect the latest updates, including: designing fee agreements, DB and cash balance plans, Schedule C, EFAST2, document issues, plan correction, and more. Plus, "Ask the Experts" workshop, concurrent sessions, and over 900 minutes of CE credits. Early bird discount has been extended to August 9, so register today and save $150.

[Guidance Overview]
New Regulation Imposing Fee Disclosure Rules on Service Providers to ERISA Retirement Plans (PDF)
Excerpt: "This new Regulation is intended to assist plan fiduciaries in assessing the reasonableness of contracts or arrangements, including the reasonableness of a service provider's compensation and potential conflicts of interest that may affect a service provider's performance."
(Dechert LLP)

[Guidance Overview]
No Blanket Extension of 5500 Due Date
Excerpt: "An employer can obtain a 2½ month extension to file a Form 5500 or Form 5500-SF by filing Form 5558 with the IRS on or before the normal due date for the return."
(SunGard Relius)

[Guidance Overview]
New Fee Disclosure Rules Require Action by Plan Fiduciaries and Service Providers of Defined Contribution and Defined Benefit Pension Plans
Excerpt: "The new requirements will apply to all service contracts or arrangements between covered plans and service providers on and after July 16, 2011 (including those in place at that time but entered into prior to that date)."
(Troutman Sanders LLP)

[Guidance Overview]
Benefit and Retirement Plans Must Comply With ERISA Bonding Rules
Excerpt: "Every fiduciary and anyone who handles plan funds must be bonded (i.e., insured). 'Handling' not only means physical contact with plan funds, but also includes people with the power to transfer money, and direct or authorize payment of benefits and other disbursements."
(LarsonAllen LLP)

[Guidance Overview]
Labor Department Secretary Opposes ERISA Statute of Limitations Argument
Excerpt: "The three-year statute of limitations under [ERISA] kicks off only when someone suing under the law first learns of a fiduciary breach. That was a key argument advanced in a friend of the court brief filed by [the DOL Secretary] urging an Illinois federal judge to throw out a former plan trustee's arguments that the legal time limit could be triggered instead when a fiduciary not directly involved in the suit finds out about potential ERISA wrongdoing."

Ledbetter Law Fails To Save El Paso Workers' Cash Balance Plan Suit
Excerpt: "A federal judge has once again thrown out a suit claiming that El Paso Corp. discriminated against workers based on age when it modified a retirement plan, ending a long-running putative class action brought after the natural gas company converted its pension plan to a cash balance system."

Study Shows Costs Do Have an Impact on Investor Selections
Excerpt: "Funds in the lowest expense ratio quartile attracted nearly $395 billion of the cumulative cash flow into all equity funds for the ten years ended December 31, 2009, representing 86% of the net assets that went into the two quartiles reporting positive flows."
(The Vanguard Group, Inc.)

Traditional IRA Investors' Contribution Activity, 2007 and 2008 (PDF)
70 pages. Excerpt: "The IRA Investor Database contains account-level information from a wide range of mutual fund and insurance companies, which provided data for more than 10 million IRA investors in 2007 and 2008."
(Investment Company Institute)

FASB & IASB Propose Increased Disclosure of Multiemployer Funding Liability
Excerpt: "In order to protect the interests of multiemployer plans and their sponsoring organizations, we are forming a group of employer associations, employers, unions, industry associations, and other interested stakeholders on whose behalf we will submit comments to the FASB, IASB, and other appropriate parties."
(Groom Law Group)

Providence, Rhode Island's Pension Fund Underfunded Due to Compounded COLA
Excerpt: "Council members say the agreement, negotiated by [the Mayor's] administration earlier this year after a nine-year stalemate, would formalize a controversial benefit that makes firefighter and police pensions more lucrative than most: the 3-percent compounding cost-of-living adjustment, or COLA."
(The Providence Journal Co.)

Lawmakers Clarify Benefit Plan Relief from Swaps Restrictions in Financial Reform
Excerpt: "On the chamber floor, senators said a temporary exemption from swaps restrictions for stable-value contracts covers plans with trustee-directed investments and participant-directed plans. Senators also confirmed that swap dealers may engage in a plan transaction if the plan's in-house asset manager is independently evaluating the deal."
(Mercer LLC)

Court Faults 401(k) Fiduciaries for Selecting Retail Funds with Higher Fees
Excerpt: "The favorable ruling for plaintiffs on even one claim is noteworthy, given that the plan had dozens of fund options and a reasonably thorough governance process -- committees met regularly, sought expert advice and didn't allow revenue sharing to influence fund selection."
(Mercer LLC)

This year's program for DOL Speaks provides an opportunity to discuss employee benefits issues with colleagues and local, regional and national government employees from the US Department of Labor, including the new DOL Fee Disclosure Regs! Exchanging information and get educated about current regulatory, legislative, fiduciary, health benefits and retirement topics straight from the source. Designed for motivated and involved benefit plan professionals from across the country and the industry!

For more information and to register, visit the

Sponsored by ASPPA

Benefits in General; Executive Compensation

Public Employees Get More Benefits Than Private-Sector Counterparts
Excerpt: "As of March, 88% of state and local government workers had access to employer-sponsored medical plans, compared with 71% of private-sector workers, according to a Labor Department report released Tuesday."
(The Wall Street Journal)

After Tighter Pay Standards Established, 17 Banks Paid Out $1.6 Billion in Bonuses, Golden Parachutes, Retention Awards and the Like
Excerpt: "President Obama's effort to curb executive pay at bailed-out financial institutions was hobbled from the start. [The White House pay czar] was allowed to veto compensation packages for top bankers at institutions that had received taxpayer funds, but only until the banks repaid them."
(The New York Times; free registration required)

Webcasts and Conferences

"403(b) Plan Design Workshop" - Boston
in Massachusetts on August 27, 2010
presented by SunGard Relius

"Cross-Tested/Safe Harbor 401(k) Plan Design Workshop" - Boston
in Massachusetts on August 26, 2010
presented by SunGard Relius

"Cross-Tested/Safe Harbor 401(k) Plan Design Workshop" - Charlotte
in North Carolina on August 25, 2010
presented by SunGard Relius

Voluntary Fiduciary Correction Program Workshop
in California on August 31, 2010
presented by U.S. Department of Labor, Employee Benefits Security Administration (EBSA)

Press Releases

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in CA

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in NY

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