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November 25, 2013          Get Health & Welfare News  |  Advertise
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Employee Benefits Jobs

Employee Benefits Account Manager
Corporate Synergies Group, LLC
in MD

Retirement Benefits Specialist
New York City Economic Development Corporation (NYCEDC)
in NY

Pensions Field Service Manager
Nationwide Financial
in AZ, IL, TX

DC Plan Administrator
The Retirement Plan Company, LLC

Account Manager
MullinTBG, A Prudential Financial company
in CA

ERISA Counsel
USI Consulting Group
in CT

401(k) Administrator
Nicholas Pension Consultants
in CA

DC Plan Administrator
MGKS, Inc.
in AZ

DB/DC Combo Plan Administrator
MGKS, Inc.
in AZ

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Webcasts and Conferences

Developing Effective and Efficient Solutions for Your Retirement Plan Clients’ Greatest Challenges
December 10, 2013 WEBCAST
(Transamerica Retirement Solutions)

Voluntary Insurance Products in the Workplace: Compliance Issues and Changing Legal Requirements
December 12, 2013 WEBCAST
(Thomson Reuters / EBIA)

Advanced Pension Conference - Orlando 2014
February 5, 2014 in FL
(SunGard Relius)

Professional ESOP Forum
February 25, 2014 in LA
(ESOP Association)

Banks with ESOPs Seminar
February 26, 2014 in LA
(ESOP Association)

33rd Annual Conference
March 12, 2014 in DC
(Employers Council on Flexible Compensation (ECFC))

View All Webcasts and Conferences

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official guidance, jobs, webcasts and more.
[Guidance Overview]

You Can't Just Wish Yourself Into Safe Harbor Plan Status
"Although Keeping it Simple and Straightforward ... is one of the goals of a safe harbor plan, achieving safe harbor plan status requires: [1] Adopting a Safe Harbor Plan Document, [2] Contributing one of the pre-approved safe-harbor employer contributions, AND [3] Sending Annual Safe Harbor Notices to all eligible employees.... [C]ompliance with one or two out of the three does not make a plan a safe harbor plan[.]" (Belfint Lyons & Shuman, CPAs)  


Broaden Your Consulting Knowledge With CPC Modules

Sponsored by ASPPA

Want to expand your client base, professional image and diversify your services? Then register now for ASPPA's CPC Modules (Certified Pension Consultant Credential)! Get advanced online retirement plan education at your convenience.

Fiduciary Standard for Brokers Backed by SEC Advisory Panel
"Members of the SEC's Investor Advisory Committee voted [on Friday, November 22] to recommend imposing a fiduciary duty on brokers who provide personalized investment advice. Brokers now are required only to steer clients toward trades or investments deemed suitable, while investment advisers are obliged to put clients' interests first.... The five-member SEC may be divided over the topic. While Democratic Commissioner Luis A. Aguilar has said he supports extending fiduciary duty to brokers providing investment advice, Republican Commissioner Daniel M. Gallagher has said he isn't convinced new rules are needed." (Bloomberg)  

ERISA Fiduciary Accused of Breach May Have a Right to Seek Contribution or Indemnification from Co-Fiduciaries (PDF)
"[T]he right to bring a contribution or indemnification claim can depend on the procedural posture of the case. If there has not been a determination of which co-fiduciary is more at fault, then a contribution or indemnification claim might be permissible, although the respective liability will, at some point, have to be determined. If, however, co-fiduciary liability already has been determined and it is possible to assign each fiduciary with a degree of fault, then the right to bring a contribution or indemnification claim might depend on those findings." (Morgan Lewis via Bloomberg BNA Pension & Benefits Daily)  

PPA Document Restatements: Plan Early and Often
"[T]hree suggestions for [practitioners to prepare] for the restatement process: [1] Compare the provisions in the PPA document with the EGTRRA document in order to familiarize yourself with the differences and the new options available. [2] Determine if you'd like to adopt defaults across multiple plans to be in line with your business practices. [3] Examine the frequency of provisions that cause confusion, then determine which changes are necessary across all plans -- thereby avoiding the [confusion] within multiple plans going forward." (American Society of Pension Professionals & Actuaries [ASPPA])  

Supreme Court Asked to Clarify Company Stock Issue in 401(k) Plans
"The appeal of company stock as an investment option in defined contribution plans could dim considerably if the [DOL] succeeds in having the U.S. Supreme Court revisit the issue of fiduciary prudence in managing that option. The department's petition to the Supreme Court ... seeks to take advantage of a recent split in judicial circuits that could make it easier for participants to challenge employers when company stock loses value.... 'ERISA's text and purposes do not call for application of a presumption at any stage of the proceedings,' the petition states." (Pensions & Investments)  

More Pension Liability Offloading by Corporate Plans Expected
"Vastly improved funding of corporate defined benefit plans should lead to more pension buyouts and lump-sum offers like the deal announced on Nov. 13 by SPX Corp.... Many corporate defined benefit plans became fully funded or even overfunded this year. The discount rate used to calculate liabilities has increased 74 basis points year-to-date through Oct. 31, causing liability figures to decrease significantly.... It has been a similar story in the U.K., where three large buyout transactions were completed during the past several months." (Pensions & Investments)  

Re-Evaluating the CFP Board's '3 Buckets' Approach for Determining Fee-Only Compensation
"[T]he definition of what constitutes 'compensation' has stretched so far that advisors can now be disciplined for failing to disclose types of compensation that don't actually exist because no client has ever actually paid it to anyone, ever! Accordingly, it's time for the CFP Board to 'clarify' its 3 buckets approach to recognize that the fundamental starting point for all types of compensation disclosure should always be what clients actually pay in the first place. The fact that no client has ever actually paid a commission to anyone, ever, should always be a valid defense for an advisor to claim that they are fee-only[.]" (Michael Kitces in Nerd's Eye View)  

Top Small-Cap Funds in America's 401(k) Plans, 2013
"Noteworthy findings since BrightScope's last release of this list, August 2011: [1] Vanguard Small Cap Index climbed from the number three spot on the list to take the top honors at number one this year. [2] The previous #1 fund, Neuberger Berman Genesis, fell completely off the list since 2011, and was joined by fellow no-shows Royce Low Priced Stock and Wells Fargo Advantage Small Cap Value. [3] BrightScope welcomes BlackRock Russell 2000 Index (#2), SSgA Russell 2000 Index (#5), and Northern Trust Russell 2000 Equity Index (#12) to the list this year." (Brightscope)  

Upside Down: The Case for Increasing Stock Exposure During Retirement
"As most of us are risk adverse, the conventional wisdom of reducing stock exposure in retirement sits quite well with us and we would have no reason to challenge it. But is it indeed the best approach? A recent study by Pfau and Kitces (2013) suggests that not only is it not the best approach, but the exact opposite approach (increasing stock exposure) is often preferable." (Morningstar Advisor)  

Are You Ready to Retire? Take This Quiz
"What if -- before starting retirement -- you first had to pass a test? ... Something that gauges how much you know about savings targets, medical bills, estate planning and a few other fundamental issues.... While the topics and questions may be increasingly familiar (given the graying of America and a growing preoccupation with all things retirement), passing grades remain hard to come by." (The Wall Street Journal; subscription may be required)  


The Cost of 'Choice' in a Voluntary Pension System
"[U]nlike our first-tier, mandatory Social Security system, America's second-tier, private pension system is replete with choice: choices about the type of pension plan, choices about the amount and timing of contributions, choices about investments, and choices about the timing and nature of distributions.... [T]his Article looks at the costs associated with the current Social Security and private pension systems.... [and] discusses how to reduce costs by moving to a universal, second-tier pension system; [it] also discusses some more modest approaches for reducing the costs associated with the current private pension system." (Jonathan Barry Forman and G. A. Mackenzie via SSRN)  


Senators Portman and Cardin Ask Treasury to Provide Nondiscrimination Relief for Certain Frozen DB Plans
"[S]oft freezes may cause plans to inadvertently violate a Treasury rule that requires qualified plans to meet certain nondiscrimination testing requirements.... [C]urrent nondiscrimination rules do not adequately allow for the comparison between defined benefit and defined contribution benefits in these circumstances.... Some companies are already facing the prospect of triggering the nondiscrimination rules, and nearly every company that wishes to soft freeze its defined benefit plan will face this problem over the next several years. The sooner Treasury can implement a practical, non-regulatory solution to this issue, the sooner companies can avoid having to hard freeze their pensions when they would prefer a soft freeze." (Senators Rob Portman (R-OH) and Benjamin L. Cardin (D-MD))  

Benefits in General; Executive Compensation

Will Fiduciary Liability Insurance Cover Severance Agreement Payments If the Company Can't Make Them?
"[The insurer] contends that even if [the employee]'s severance agreement was a 'Sponsored Plan' under the policy, there wasn't a 'Wrongful Act' -- again, an accident or negligence -- on [the firm]'s part: [when it decided to liquidate,] the firm simply chose not to continue making payments it had agreed to make.... Much will depend on the exact policy language here, and how it addresses severance agreements -- if it does at all. Even outside of the insurance field, whether a severance agreement is a 'plan' under ERISA is often in dispute.... [T]he Supreme Court tried to provide some clarity [in one case] by holding that a one-time severance payment after a plant closure was not a plan under ERISA because it didn't have an ongoing administrative component -- but it's not at all clear if that's the only test for a covered plan." (Zuckerman Spaeder LLP)  

New York Cracks Down on Executive Compensation for Not-for-Profits
"In this article, [the authors] discuss the relevant authorities, and focus on regulations issued by the [New York] Department of Health for not-for-profits in the health industry. [They] then suggest a series of 'best practices' for not-for-profit corporations -- both in the health industry and other sectors -- as they make compensation determinations for their executives." (Mintz Levin)  

No Surprises in Final ISS Voting Policies for 2014
"ISS conducted back-testing and found that less than 7% of U.S. companies would show significant differences in [relative-degree-of-alignment (RDA)] test results as a result of the change.... If the RDA test raises a concern, ISS will continue to shift to a more detailed qualitative review of company pay programs. In another change, made in a little-noticed footnote, the universe of U.S. companies for which ISS will include realizable pay comparisons to granted pay will be expanded to the S&P 1500 companies from the S&P 500 beginning with February 1, 2014 meetings." (Towers Watson)  

ISS and Equilar/Glass Lewis Now Accepting Updated Peer Group Submissions (PDF)
"Institutional Shareholder Services (ISS) and Equilar / Glass Lewis have announced that they are now accepting updated self-selected peer group submissions from Russell 3000 companies.... Submitted self-selected peers may be considered by ISS and Equilar /Glass Lewis when developed peer groups used for next year's executive pay evaluations." [Article includes a summary of each group's announcement including links to access online submission forms.] (Frederic W. Cook & Co., Inc.)  

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