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September 20, 2013          Get Health & Welfare News  |  Advertise
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Employee Benefits Jobs

Webcasts and Conferences

Are You Keeping Your Client's Health Information Secure? -- Recorded
October 4, 2013 WEBCAST
(Nixon Peabody LLP)

The Fix Is In! Your Year-End Checklist for Using the IRS 403(b) Fix-It Guide
December 5, 2013 WEBCAST
(National Tax Sheltered Accounts Association)

Health Reform - Beyond the Basics: Putting It Together
October 3, 2013 WEBCAST
(Center on Budget and Policy Priorities)

COBRA Administration Specialist (CAS) Study Session
September 25, 2013 WEBCAST
(Flexible Compensation Institute (FCI))

Flexible Compensation Specialist (FCS) Exam and Certified in Flexible Compensation (CFC) Study Session
September 26, 2013 WEBCAST
(Flexible Compensation Institute (FCI))

Public Funds Defined Contribution Summit
October 1, 2013 in IL
(Pensions & Investments)

Public Funds Defined Contribution Summit
October 3, 2013 in NY
(Pensions & Investments)

Fee Disclosure Regulations - A Discussion of Important Obligations for Plan Sponsors
October 24, 2013 in NY
(Bond, Schoeneck & King, PLLC)

2013 Employee Benefits Fall Seminar
October 30, 2013 in KS
(Spencer Fane Britt & Browne LLP)

View All Webcasts and Conferences

  LinkedIn   Twitter   Facebook Hand-picked links to the web's best news articles,
official guidance, jobs, webcasts and more.
[Guidance Overview]

Safe Harbor 401(k) Chart
"These are some of the basics that an employer needs to know before considering a 401(k) Safe Harbor Plan. Each employer's goals, plan design, contribution sources and demographics form a unique scenario which the employer will wish to discuss with his or her plan provider before finalizing the decision to make the plan a 401(k) Safe Harbor Plan." (McKay Hochman)  


DATAIR! Better Than Ever – Flexible Pricing – Superior Validation

Sponsored by DATAIR Employee Benefit Systems, Inc.

Choose "Pension Reporter System" modules you need:
EFAST2 5500/PBGC/SAR, 1099Rs, 5300s, FAS158
(888) 328-2474    Sales@DATAIR.com    www.DATAIR.com

Fiduciary Rule May Not Appear Until Spring, 408(b)(2) Guide Out Soon
"One 'wild card' in the fiduciary re-proposal will be how the DOL addresses individual retirement accounts and associated rollovers and rollover solicitations ... The final rules under Section 408(b)(2) that were released on Feb. 2, 2012, included a 'sample road map' that was not required to be used ... If the proposed rules are similar to the sample road map in the final Section 408(b)(2) rules, it might become a lot of work for service providers, [Fred] Reish said." (Bloomberg BNA)  

Revenue Estimates of Restricting Tax Deferral: It Ain't Necessarily So
"[T]ax deferral changes the amount of revenue the government collects at three points. When compared to savings funded with compensation that is subject to tax and invested in a taxable account, tax-deferred savings generate: [1] Less tax revenue when workers make retirement contributions; [2] Less tax revenue when investment returns are earned on the contributions; [3] More tax revenue when distributions are taken in retirement Thus, any proposal that restricts tax deferred retirement contributions will have different effects on tax revenue over time." (Investment Company Institute [ICI])  

Former U.S. Auto Czar Ron Bloom to Advise Detroit Retirees
"Detroit's retirees have bolstered their defenses against benefit cuts in the city's bankruptcy case by hiring Ron Bloom, a chief architect of the Obama administration's 2009 U.S. auto bailout and long-time adviser to unions in industry shake-ups. Lazard Ltd, where Bloom is now vice chairman, said it will advise a nine-member committee that represents 23,500 public sector retirees facing cuts to their healthcare and pension benefits after Detroit's Chapter 9 Bankruptcy filing on July 18." (Reuters)  

Money Market Funds in Defined Contribution Plans: Time to Rethink? (PDF)
"[Many plan] sponsors are beginning to express concern about how these potential changes may affect their plans. Although the SEC appears sensitive to the impact of its proposals on DC sponsors and service providers, complying with the new disclosure and transparency requirements could be an expensive and uncertain process. Moreover, the reforms compound the challenges faced by MMFs -- challenges that at a fundamental level have made MMFs increasingly less effective as a capital preservation-focused solution for DC plans." (PIMCO)  


The new "Go-to Annual Event" | Registration now open!

Sponsored by HRE's Health & Benefits Leadership Conference

Make a difference in your organization and the lives of your employees. From healthcare reform to the changing definition of retirement, this event delivers meaningful solutions to many of today's plaguing issues. Learn more.

FINRA to File Recruitment Compensation Proposal with the SEC
"The proposal contains two components: a disclosure obligation and reporting to FINRA. The disclosure requirement would apply to recruitment compensation -- including signing bonuses, up-front or back-end bonuses, loans, accelerated payouts, and transition assistance -- of $100,000 or more, and to future payments (trade-based or asset-based) contingent on performance criteria. Firms would be required to disclose to their customers the compensation paid to the transferring representative in ranges. The first range would be $100,000 to $500,000; the next would be $500,000 to $1 million; followed by increasingly larger bands." (Financial Industry Regulatory Authority [FINRA])  

Detroit Pension Fund Denied $39.9M Claim Against Banks
"An arbitration panel has denied fraud claims against Citigroup Global Markets, Morgan Stanley & Co and others brought by Detroit's Police and Fire Retirement System, which was seeking $39.9 million in damages. The three-member panel of [FINRA] ... denied and dismissed ... all of the claims the pension fund filed against the banks in May 2010. The fund accused the banks of fraud and breaching contracts and their fiduciary duty over their recommendations to invest in various collateralized debt obligation funds. The pension fund, which reported net assets of $2.9 billion at the end of fiscal 2012, sought $39.9 million in actual and compensatory damages." (Reuters)  

Rhode Island State Pensions to Lower Assumed Rate of Return -- Again
"[The Rhode Island] state Retirement Board in April 2011 lowered the assumed rate of return from 8.25 percent to a far more realistic 7.5 percent. But in doing so, it increased the unfunded liability for the pensions of teachers and state retirees by more than a whopping $150 million.... And now a new audit by Cheiron -- citing conclusions in a recent study by Gabriel Roeder Smith & Co., the state's pension consultant -- says the board should 'consider lowering' its assumed 7.5 percent rate of return even further. There is only a 40 percent chance returns will be that good over the next 20 years, it believes." (Providence Journal)  

District Court Grants Class Certification in Boeing Co. Excessive Fee Case
"Spano is one of the original excessive fee cases filed in 2006.... The court keyed in on what was different this time around, as compared to the class certification that was overturned earlier: (1) the breadth of the defined classes has been limited to a specific time period, not all participants, past, present, and future and (2) each of the claims has been broken into subclasses, rather than one gigantic class, with specific evidence that the class reps seeking to represent that subclass meets the adequacy and typicality tests." [Spano v. Boeing, No. 06-0743-DRH (S.D. Ill., Sept. 19, 2013)] (FRA PlanTools, LLC)  


Same-Gender Marriage Rulings: Impacts on Employee Benefit Plans Across the Nation - September 30 Webinar

Sponsored by Lorman and BenefitsLink

This live webinar will provide information needed to administer benefit plans in accordance with applicable laws and will discuss best practices for offering benefits to civil union partners and other same-sex partners. Registration discount for BenefitsLink readers.

Moody's Proposes Making Pension Liabilities a Bigger Factor in Bond Ratings
"The agency would increase the weight to 20 percent from 10 percent and decrease the weight for economic strength to 30 percent from 40 percent. Weights for governance and management (20 percent) and financial strength (30 percent) -- the other two factors in the way Moody's scores its [government obligation] ratings -- would stay the same. The step by Moody's is just the latest in what has become a marathon of changes by various organizations in recent years that aim to place a bigger emphasis on pensions' effect on fiscal health." (Governing)  

New Hampshire Retirement System Posts 14.5% Return in Fiscal Year
"The $6.4 billion pension fund's custom benchmark was 13.5%, and its assumed rate of return is 7.75%. The best-performing asset class for the fiscal year was domestic equity at 23.2%, while international equity returned 13.8%. Real estate returned 12.3%, alternative assets returned 8.7%, and total fixed income returned 2.8%." (Pensions & Investments)  

The Social Security Windfall Elimination and Government Pension Offset Provisions for Public Employees in the Health and Retirement Study (PDF)
"About 3.5 percent of households are subject to either [Social Security's Windfall Elimination Provision (WEP)] or to [the Government Pension Offset (GPO)].... Households affected by both WEP and GPO lose about one third of their benefit. Limiting the Social Security benefit to half the size of the pension from uncovered employment reduces the penalty from WEP for members of the original HRS cohort by about 60 percent." (University of Michigan Retirement Research Center)  


Money Market Fund Remedies 'May Kill Patient'
"[AFP Government Relations Committee Chairman James P. Gilligan, CTP] argued that the resulting cost of triggered investor withdrawal, accounting, tax and investment policy complications outweigh the effectiveness of the proposed changes aimed to thwart potential market runs. As an issuer of commercial paper on behalf of his company, Gilligan further warned members of U.S. Congress that the almost half of all outstanding nonfinancial commercial paper purchased by MMFs could 'drop significantly and the commercial paper market would be substantially less liquid,' under the SEC proposals." (Association for Financial Professionals)  


Thoughts on CalPERS and Passive Investing
"[H]ow long will it be until fiduciaries who switch their plans to index and passive funds are sued by participants claiming they would have done better under actively managed funds, and that, given the make up of the particular participant base for that plan and their investment objectives, active investing was the prudent course? ... [W]hat happens when everyone follows along and goes index only? Who do you trade with on the other side of the deal, and what -- if everyone is just moving along with the market index -- drives the price one way or the other, when there is no one out there buying and selling in the hope of beating that index?" (Stephen Rosenberg of The McCormack Firm, LLC)  

Benefits in General; Executive Compensation

[Guidance Overview]

Hot Topics in Employee Benefits, September 18, 2013 (PDF)
65 presentation slides. Topics include: [1] Insurance exchange notices: Analysis of taking a narrow legal compliance approach vs. using the notices to nudge non-employees off of employer-provided coverage; [2] The Sun Capital decision: Hidden multiemployer withdrawal liability for private equity funds; [3] New guidance from the DOL on revenue sharing and ERISA accounts; [4] Implications for plan sponsors of qualified plans following the U.S. Supreme Court's [DOMA] holding; and [5] Executive compensation "Good reason" provisions in severance plans and executive employment agreements and issues that arise under section 409A. (Morgan Lewis)  

[Guidance Overview]

SEC Proposes CEO Pay Ratio Disclosure Rules Required by Dodd-Frank
"Despite several requests that the SEC limit the calculation to full-time employees based in the U.S., the proposed rules do not allow an issuer to exclude part-time, temporary or seasonal, or foreign employees. Under the proposed rules, an issuer can annualize the compensation of newly hired employees or permanent employees on an unpaid leave of absence, but it may not annualize the compensation of part-time, temporary or seasonal employees or make cost-of-living adjustments to the compensation of foreign employees." (Sidley Austin LLP)  

[Guidance Overview]

SEC Proposes CEO-to-Median Employee Pay Ratio Disclosure Rules
"The disclosure of the company's methodology, including assumptions, adjustments and estimates used, should provide enough information for an investor to evaluate the appropriateness of the calculation.... [If] statistical sampling is used, the company should disclose the sample size, the size of the whole population, the sampling method and how differences in systems or geographies were handled. Changes in assumptions, adjustments or estimates from one year to the next should also be identified, including the reason for the change and the estimated impact of the change on the median and the ratio." (Faegre Baker Daniels LLP)  

What's the Right Ratio for CEO-To-Worker Pay?
"Is it 147-to-1, the reported ratio in Germany, the economic powerhouse of the European Union? Is it 58-to-1, the ratio from the late 1980s, according to the Economic Policy Institute, before the stock options craze of the 1990s really got going? Or to be purely arbitrary (if more realistic), should it be 100-to-1? No doubt what's deemed acceptable once these ratios start coming out will be just that: arbitrary. Whatever the median ratio is -- however inflated that may be in today's world of executive compensation -- will by default become the new yardstick." (The Washington Post; subscription may be required)  

CEO Pay Ratio Disclosure Won't Be Required for 2014 Proxy Season
"[T]he proposed regulations make it clear that disclosure of the CEO pay ratio won't be required until the 2015 proxy season at the earliest. That would mean the data being included in the 2015 proxy, assuming the regulations were finalized before the end of 2013, would be based on compensation data assembled for the 2014 fiscal year. So companies have more time to gather and analyze the employee information that will be needed to comply with the pay ratio disclosure rule." (Towers Watson)  

'Top-Hat Plan' Exemption Compliance for Deferred Compensation Arrangements
"As corporate interest in deferred compensation plans increases, advisors can offer significant value to clients who are contemplating the establishment of such plans by guiding them through a top-hat analysis that ensures (1) only a relatively small percentage of the workforce is invited to participate, (2) the plan participants have executive or managerial employment duties, (3) there is significant disparity in the average compensation levels between plan participants and nonparticipants, and (4) the language of plan documents limits participation to a select group of management or highly compensated employees." (AALU and Fulcrum Partners)  

FASB Task Force Provides Guidance on Accounting for Stock Compensation (PDF)
"The [Emerging Issues Task Force (EITF)] tentatively decided that equity awards with a performance target that may be attained after completion of an underlying service-vesting period (if any) should be accounted for as a performance condition that affects the vesting of the award. Thus, compensation cost is recognized over the vesting period when attainment of the performance target becomes 'probable,' which could be subsequent to the service vesting period when the award recipient is no longer employed or never if the performance target is not attained." (Frederic W. Cook & Co., Inc.)  

Medicare and Social Security Payroll Taxes and Benefits for People in Different Birth Cohorts
"Over their lifetime, beneficiaries born in the 1940s would, on average, receive about $160,000 in benefits (net of premiums paid) and pay about $45,000 in payroll taxes (both figures are expressed in 2013 dollars). Those born in the 1950s would receive, on average, about $205,000 in benefits and pay about $60,000 in payroll taxes, CBO estimates. And those born in the 1960s would receive, on average, about $270,000 in benefits and pay about $65,000 in payroll taxes." (Congressional Budget Office)  


Pay Ratio Rule Explained ... In Plain Pithy English
"[T]here is nothing in the rule that either serves to reform Wall Street or to protect consumers. In case you missed that, let me repeat in different words: the rule serves no useful purpose.... The rule allows for significant simplification in the process. That said, multinational companies with decentralized payrolls may still spend millions of dollars complying with 953(b), but that still pales when compared with what they might have spent." (Benefits and Compensation with John Lowell)  

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