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Retirement Plans Newsletter

November 1, 2010

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[Official Guidance]
OASDI and SSI Program Rates & Limits for 2011 (PDF)
1 page. The maximum monthly social security benefit for workers retiring at full retirement age is $2,366.
(U.S. Social Security Administration)

[Guidance Overview]
Participant Fee Disclosure: Fee Transparency Is the Final Piece of the Puzzle (PDF)
4 pages. Excerpt: "The . . . summary looks at the regulation from the responsible plan fiduciary's perspective."
(Vedder Price P.C.)

[Guidance Overview]
DOL's Proposed New ERISA Rule to Expand the Definition of 'Fiduciary' (PDF)
5 pages. Excerpt: "The Proposed Rule would re-write and expand the scope of the current 35-year old regulation . . . that delineates when a person becomes a fiduciary by reason of providing 'investment advice' for a fee or other compensation with respect to plan assets."
(Paul, Hastings, Janofsky & Walker LLP)

[Guidance Overview]
Tax-Qualified Retirement Plans: Amendments and Other Year-End Action Items (PDF)
10 pages. Excerpt: "This list is not exhaustive, but is intended to serve as a reminder of items that should be reviewed and considered before the end of the year."
(Morgan, Lewis & Bockius LLP)

[Guidance Overview]
DOL's Final Regulation on Participant-Directed Individual Account Plan Disclosure Obligations (PDF)
4 pages. Excerpt: "The new regulation applies to administrators of plans that are intended to comply with Section 404(c) of ERISA . . . ."
(Dechert LLP)

[Guidance Overview]
Actuary Did Not Violate Professional Standards in Relying on Erroneous Data Provided by Union Pension Fund
Excerpt: "The actuary was not required by professional standards or the contract to audit the data and its reliance on the information was reasonable."
(Wolters Kluwer)

[Guidance Overview]
Pension Funding Relief Portion of the Affordable Health Care for America Act (PDF)
Pages 3-4 of 8 pages. Excerpt: "Plan sponsors have two methods to choose from if they decide to take advantage of this second attempt by Congress to shield companies from the terrible effects of the Pension Protection Act's required seven-year amortization of underfunded pension plans."
(American Academy of Actuaries)

[Guidance Overview]
You May Need to Send an Annual Notice to Plan Participants by December 1, 2010 (PDF)
4 pages. Excerpt: "Failure to issue a required annual notice can have a significant impact."
(Alston & Bird LLP)

[Guidance Overview]
Tibble v. Edison International: Excessive Fees Finally Go to Trial (PDF)
9 pages. Excerpt: "The court reaffirmed the principle that the fact that a plaintiff's expert can point to an investment with better performance or lower fees in hindsight will not establish a breach of the duty of prudence where the fiduciaries have diligently and appropriately investigated the investment and made a decision consistent with mainstream investment decisions . . . ."
(The Bureau of National Affairs via Reish & Reicher)

GM Slates $6 Bil.lion Pension Contribution
Excerpt: "General Motors Co., Detroit, will contribute at least $4 bil.lion in cash and $2 bil.lion in GM common stock to the company's $85.9 bil.lion U.S. hourly and salaried pension plans, the company announced Thursday."
(Pensions & Investments)

PBGC Taking Over Four More Plans
Excerpt: "The Pension Benefit Guaranty Corp. is assuming responsibility for the pension benefits of about 1,500 current and former employees of Hostess Brands Inc., Irving, Texas . . . ."
(Pensions & Investments)

'Fiduciary News' Trending Topics for ERISA Plan Sponsors: Week Ending 10/29/10
Excerpt: "Each Monday, [Fiduciary News gives] you a quick synopsis of the major news events and trends impacting ERISA plan sponsors, 401k fiduciaries and those in the business of supporting these fine folks."
(Fiduciary News)

The 60/40 Allocation and Pension Plan Assets (PDF)
Pages 6-7 of 8 pages. Excerpt: "Plan sponsors have come to understand that there is a link between pension plan assets and obligations, the financial risks they pose in terms of cash flow, profit and loss (P&L), and the corporate balance sheet and the human resources risks under the Pension Protection Act."
(American Academy of Actuaries)

Funding Massachusetts Public Pensions Has Retirement System and Legislature at a Loss
Excerpt: "Patrick administration officials estimate that pension fund investment losses that hurt the fund's value will force the state to increase the taxpayers' share of costs to $2.3 bil.lion a year."
(State House News Service via

Reevaluating the 401(k) Educational Campaign to Ensure It's Fresh and Up to Date
Excerpt: "[P]lan sponsors should ensure their onsite and in-person educational sessions explain why the company offers a DC plan, the benefits of saving for retirement through a 401(k), how much it will cost an employee to contribute and how much more they might have at retirement if they save appropriately . . . ."
(Employee Benefit News; free registration required)

Reform and Backlash to Reform: Effects of Ageing and Retirement Policy
Excerpt: "[T]his paper studies (i) the effects on both extensive and intensive labour supply responses to changes in fertility rates, and (ii) the potential of a retirement reform to mitigate the effects of fertility changes on labour supply."
(Social Science Research Network)

Diversification Rules for ESOPs and 401(k) Plans with Employer Securities (PDF)
Pages 6-8 of 8 pages. Excerpt: "Employers that have a 401(k) plan with employer stock or an ESOP must give employees unbiased information about their investment choices, including company securities."

Public Employee Pensions Under Fire
Excerpt: "Anger over the growing divide in retirement security between the public and private sectors has even been given a name -- 'pension envy.'"
(The Press Democrat)

Virginia Retirement System Warns Assembly on Pension Funding
Excerpt: "This is not a year when the board recommends contribution rates to the General Assembly for state employee and teacher pensions. However, rates would have to increase by more than 60 percent over last year's rates to fund long-term retirement obligations fully, according to an actuarial analysis presented to the board yesterday."
(Richmond Times-Dispatch)

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Sponsored by NTSAA

Benefits in General; Executive Compensation

Employee Benefits Developments, October 2010
Excerpt: "A brief look at developments in Employee Benefits law from September and October 2010, including cases, rulings, and opinions."
(Hodgson Russ LLP)

With Little Room for Raises, Companies Can Offer Perks
Excerpt: "For employees at companies strapped for funds, experts say these workers can request rewards that won't necessarily show up on a paycheck."

Labor and Employee Benefits Handbook Coverage on the United States
Excerpt: "[The 13-page article provides] a summary of the United States' cross-border labor and employment laws. The article explores a number of different areas, including work permits, discrimination and harassment, and pensions."
(Practical Law Company via Littler Mendelson P.C.)

Webcasts and Conferences

401(k) Rekon Advisor Symposium- Cincinnati
in Ohio on November 4, 2010
presented by 401(k) Rekon

401(k) Rekon Advisor Symposium- St. Louis (Richmond Heights)
in Missouri on November 9, 2010
presented by 401(k) Rekon

Press Releases

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