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May 25, 2012 Get Health & Welfare News  |  Advertise  |  Unsubscribe  |  Past Issues  |  Search

Employee Benefits Jobs

Client Relationship Manager
for Plancorp, LLC in MO

Director of Operations - Retirement Plan Implementation Services
for VALIC in TX

Regional Distribution Manager
for Ameritas Life Insurance Corp in CA, DC, GA, MA, NV, NY, PA

Regional Accounts Manager
for Ameritas Life Insurance Corp in CA, DC, GA, MA, NV, NY, PA

Pension Administrator
for Primark Benefits in CA

Technical Support Specialist
for Primark Benefits in CA

401(k) Daily Record-Keeping Specialist
for Primark Benefits in CA

for Meeker-Magner Company in IL

Pension Compliance Specialist
for CUNA Mutual Group in WI

Pension Participant Service Specialist
for CUNA Mutual Group in WI

Qualified Plan Specialist
for CUNA Mutual Group in WI

Manager, Business Operations
for CUNA Mutual Group in WI

Retirement Services Manager
for CUNA Mutual Group in WI

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Webcasts and Conferences

401(k) Rekon Advisor Symposium - Pittsburgh
in Pennsylvania on June 21, 2012 presented by 401(k) Rekon

401(k) Rekon Advisor Symposium - Nashville
in Tennessee on June 21, 2012 presented by 401(k) Rekon

25th Annual Benefits Forum & Expo
in Arizona on September 9, 2012 presented by Employee Benefit News

"Fundamentals of 401(k) and Other Qualified Plans" - Atlanta
in Georgia on June 27, 2012 presented by SunGard Relius

Health FSA and DCAP Nondiscrimination Rules: Design and Testing Fundamentals (Session II)
Nationwide on May 24, 2012 presented by Thomson Reuters / EBIA

We also publish the BenefitsLink Health & Welfare Plans Newsletter (free): Subscribe

[Guidance Overview]
Transcript of IRS Webcast: Employee Plans Determination Letter Program Update (March 30, 2012) (PDF)
16 pages; covers many topics. The speakers are describing slides presented during the webinar; the slides also are online. Excerpt: "Eliminating demonstrations and limiting inbound Form 5307s are probably the two biggest concerns many of you have." (Internal Revenue Service)

Attend the 2012 Western Benefits Conference   [Advert.]

Sponsored by ASPPA & WBC

Designed for retirement, health, welfare & benefits professionals, with particular emphasis on practical issues important to plan sponsors & their advisors. Speak with nationally-renowned speakers & government representatives and more!

403(b) Plan Response to Current Conditions: Survey Data (PDF)
This shapshot includes charts and graphs that illustrate data obtained from the annual survey of 403(b) plan sponsors, along with a copy of the survey questions. (Plan Sponsor Council of America)

Louisiana House Rejects Governor's Proposal to Move from DB to DC Plan
"Gov. Bobby Jindal's proposal to create a new retirement plan for future rank-and-file state workers failed to win final legislative passage, narrowly rejected Thursday in a Louisiana House vote. The proposal would create a cheaper investment account similar to a 401(k) plan for state employees hired after July 1, 2013, instead of a monthly retirement payment based on their salaries and years of employment." (The News Star)

Cyberattack Exposes 123,000 Federal Thrift Savings Plan Accounts
"According to the [Federal Retirement Thrift Investment Board], there is no indication that the data has been misused or that TSP's website was affected by the cyber breach." (Government Executive)

Pension Bankrup.tcy in Tiny U.S. Territory Is Warning of What Might Lie Ahead
"Last month, the territory of the Northern Mariana Islands became the first U.S. public pension fund to declare bankrup.tcy. Like many public pension plans across the country, the financial condition of the ... pension fund deteriorated significantly over the past five years. ... [Based] on data from the California State Controller, in [the] city of Berkeley, the employer contribution rate for police—the largest area of municipal spending—has grown from 3.6 percent of salaries 10 years ago to 40.4 percent, usurping much needed funds from other purposes to meet these new pension costs." (Huffington Post)

Louisiana Retirement Proposal Gets Last-Minute Detour
"A proposal to enroll newly hired state employees in a 401(k)-style plan was blocked Thursday from final passage to Gov. Bobby Jindal's desk, forcing the measure into a conference committee.... [The bill's sponsor] argued that the measure is necessary to prevent the growth of the now more than $18 bil.lion gap between the amount of money in the state retirement systems and what is needed to pay out employee benefits. But opponents said the system could be perilous for state employees, who are not enrolled in Social Security and thus would not be protected by that safety net." (

Illinois Lawmakers Took Care of Themselves in 1989 Pension Revamp
"The 3 percent deal, available to no one in state government outside of the General Assembly Retirement System, or GARS, is another in a long line of pension provisions written by lawmakers for lawmakers ... It also stands as a glaring example of how the legislature repeatedly passed benefit increases with little or no concern for the costs." (Chicago Tribune)

401(k) Plan Brokerage Windows and Participant Fee Disclosures (PDF)
"FAB 2012-02 [includes] new guidance ... about brokerage windows disclosures and may require that all participants receive a full brokerage commission schedule (not just participants who actually use brokerage windows). Disclosures must also include information about trading fee schedules, commissions, minimum balance fees and other expenses relating to the brokerage window. (Similarly, a participant is not required to take a plan loan in order to receive disclosures about the fee and expense information associated with plan loans.)" (Kelly, Hannaford & Battles P.A.)

Trademark Makes It Time to Rethink Terms for Multiple Employer Plans
"[O]n March 14, 2012, a firm in Tennessee filed a trademark application with the U.S. Patent & Trademark Office for the term 'The Open MEP' [saying it] refers to 'consulting services in the field of retirement plan administration and fiduciary compliance; financial administration of retirement plans', and that they have been using this term to describe their business since Oct. 31, 2004. While multiple employer plans with adopting employers sharing a common plan design or investment strategy have been around longer than Oct. 31, 2004, referring to them as 'open MEPs' is such a misnomer that there should be no fight within the industry over this trademark." (The Pension Protection Act Blog)

Hey, Wait Up; You Mean My Plan Filed Suit Without Me?
"[E]very court of appeals to have considered [the issue of excessive fees or improper profits from investments used in ERISA plans] (the Second, Third, and Fourth Circuits) has held that the participant plaintiffs do not have to make a pre-suit demand on the plan's fiduciaries to take action and do not need to join the fiduciaries as parties to the action.... At first blush this seems a laudable trend from the fiduciary's perspective. The plan can pursue a claim but incurs no cost in doing so. Perhaps if the plaintiffs' lawyers are able to prove their case then all plan participants will benefit. In time, however, these suits may turn against the plan fiduciaries themselves." (Seyfarth Shaw)

Providence Ends $700,000 Pension Promise in Insolvency Fight
"[Former Providence, R.I. fire chief Gilbert] McLaughlin, 75, is the highest paid of Providence's 3,000 retired workers, collecting a $196,813 pension this year, the result of yearly 6 percent cost-of-living increases the city once bestowed on firefighters and police. Lawmakers [have] ended the automatic raises and [have] capped annual payouts. Now retirees such as Gillie, as he is known, won't see their pay outs double every 12 years. 'No one ever did the math on this ... I don't think anyone had any idea that if Gillie lived to 100, he'd be making $700,000.'" (San Francisco Chronicle)

Why Low Costs and Fees Are So Important to the Success of Your Company's 401(k) Plan
"To optimize the value of a 401(k) plan, employers need to focus on three important tenets: run the plan in the best interest of employees; use investments that diversify risk and minimize the potential for a large loss; and above all, keep fees as low as reasonably possible. One percent or less in fees can make a big difference in how much is ultimately saved for retirement." (Forbes)

Delaying Social Security Benefits Is 'Best Deal in Town'
"Buying an annuity from Social Security is generally more attractive than buying a commercial annuity because the increased Social Security payments are actuarially fair with no additional cost to participants ... Commercial annuities, on the other hand, have to factor in marketing, management and risk-bearing costs into their prices. Plus, Social Security benefit adjustments are based on the life expectancy of the average individual while individuals who buy commercial annuities tend to have above-average life expectancy and the cost of providing yearly income is priced accordingly." (Investment News; free registration required)

Pension Fund Investors Eye European Chaos for Opportunity
"The European debt crisis is a real threat to pensions of all types as the global economy has made protecting assets through diversification much more difficult ... The traditional argument in favor of international investing, namely diversification, is waning as the global marketplace become flatter and various trading venues become more closely linked," said Susan Mangiero, a financial risk manager and managing director at New York-based FTI Consulting. (

ERISA Budget Accounts: Revenue Sharing in Retirement Plans
Recorded webinar. "ERISA budget accounts provide plan sponsors revenue sharing dollars, which can be used to cover plan administrative expenses. Understanding how to best use the funds can be challenging, as their structure is complicated and requires plans to follow proper allocation methods and timing. Using them incorrectly can expose a sponsor to penalties for fiduciary breach." (Nixon Peabody)

How Much Company Stock is Too Much in Your 401(k) Account?
"12 percent of companies provide a company stock match, [which is] down from 45 percent in 2001. And only 1.2 percent of plans that provide a stock match bar employees from selling that stock immediately. If you purchase company stock in your 401(k), or your company matches in the stock, the best way to manage the risk is to select automatic rebalancing every six months." (SecondAct)

Benefits in General; Executive Compensation

Finance Executives Share Perspectives on the Future of Retirement and Employee Benefits (PDF)
Strategies employers are now pursuing to deal with the rising costs of benefits programs while providing employees with the best benefits possible include shifting to more of an employee choice benefits model; increasing voluntary benefits for active employees and retirees; deciding about the future of their DB plans; and addressing concerns that employees are delaying retirement decisions due to inadequate savings. (Prudential)

Employees Value 'Purpose' Over Promotion
"People's attitudes towards the level of engagement and satisfaction [that] a job is expected to deliver have changed dramatically. Our report demonstrates how employees are increasingly seeking intangible advantages from their jobs beyond pay, benefits and career prospects—and how important it has become for companies to act on this change." (Wolters Kluwer Law & Business)

Despite Significant Investments, Few Companies Effectively Managing Total Rewards Programs
"Survey results confirm that many business leaders and HR practitioners believe that when total rewards are properly aligned, designed, and delivered, the impact on individual engagement and organizational performance can be significant. And yet ... 60% of companies surveyed described their engagement levels as low, and two-thirds responded that the trend in engagement is holding steady or trending downward. [Survey results and] analysis of high-performing organizations, point the way toward some of the initial steps and even some of the more advanced actions that employers can take to improve the value they are getting on their total rewards spend." (Aon Hewitt)

Press Releases

401(k) Advisors Is Certified For Fiduciary Excellence
(Centre for Fiduciary Excellence (CEFEX)), Inc.
1298 Minnesota Avenue, Suite H
Winter Park, Florida 32789
Phone (407) 644-4146
Fax (407) 644-2151

David Rhett Baker, J.D., Editor and Publisher
Lois Baker, J.D., President
Holly Horton, Business Manager

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