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December 17, 2013          Get Health & Welfare News  |  Advertise
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Employee Benefits Jobs

Webcasts and Conferences

Breaking Down the Many “Fiduciary” Roles, Obligations and Service Models Today
January 15, 2014 WEBCAST
(American Society of Pension Professionals & Actuaries (ASPPA))

Health Care Reform for Employers: Now What?
January 15, 2014 in KY
(Lorman Education Services)

How to Define Full Time Employees under the ACA
January 22, 2014 WEBCAST
(Know Benefit Compliance )

ACOs Summit 2014
January 27, 2014 in TX
(Opal Events)

Employee Plans Technical Guidance Phone Forum
February 26, 2014 WEBCAST
(Internal Revenue Service (IRS))

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]

IRS Issues Guidance on In-Plan Rollovers to Designated Roth Accounts in Retirement Plans
"Plans may limit the type of contributions eligible for an in-plan Roth rollover.... Plans may limit the frequency of in-plan Roth rollovers.... Plans with ongoing qualified Roth contribution programs may discontinue such programs because an employee's ability to make an in-plan Roth rollover is not a protected benefit." (Sidley Austin LLP)  


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[Guidance Overview]

IRS Issues Specific Guidance on In-Plan Roth Transfers
"Interestingly, the Notice never uses the phrase 'in-plan Roth Transfer' [(IRT)]. Instead, the Notice expands the concept of [in-plan Roth rollovers (IRR)] to include IRT. So, what we are left with is in-plan Roth rollovers of otherwise distributable amounts (effective in 2010) and in-plan Roth rollovers of otherwise nondistributable amounts (IRT, effective in 2013). The convenience of this approach is that it immediately answers most of the questions about IRT. Just apply the IRR rules that the IRS outlined in Notice 2010-84." (SunGard Relius)  

Supreme Court to Settle Circuit Split Over Fiduciary Presumption of Prudence in Stock Drop Suits (PDF)
"The Sixth Circuit confirmed its holding in Pfeil that the presumption of prudence does not apply at the pleading stage. Additionally, the Sixth Circuit reiterated its view that the presumption, when applied during the fact-finding stage of the case, may be rebutted by a showing that 'a prudent fiduciary acting under similar circumstances would have made a different investment decision.' Although the court referred to this standard as a presumption of prudence, practically speaking, such an articulation is effectively equivalent to an ordinary prudent-man standard and thus provides no special protection to fiduciaries offering company stock." (Groom Law Group)  

Social Security Begins Paying Survivor Benefits to Same-Sex Married Couples
"The Social Security Administration announced Monday that it has begun processing claims for surviving members of same-sex marriages and paying benefits where they are due. To be eligible for a survivor benefit, which is worth 100% of what the deceased worker was collecting or was entitled to collect at the time of his or her death, the spouse must have been married to the worker for at least nine months at the time of death, unless one of the exceptions is met." (InvestmentNews)  

Lucky '13: With Funded Statuses Up, What Should You Do Next?
"For the first time since 2009, many pension plan sponsors are poised to have their asset return significantly outpace their liability return and improve their funded status.... So if '13 is your pension plan's new lucky number, now may not be the time to continue with more of the same asset allocation to see if '14 can be just as great. Now is the time to take a good look at your plan's current situation (asset allocation, funded status, plan status, corporate objectives, etc.) and seriously assess if the asset risk relative to the liability is appropriate." (Vanguard)  


Premium Educational Event for Taft-Hartley Trustees

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The Quest for Performance: Less Than 1% of Institutional Portfolios Achieve Superior Results After Costs (PDF)
46 pages. Excerpt: "Specifically in the case of aging populations with high demands for pension payouts, distribution pressures on both defined-benefit and defined-contribution plans continue to grow as fixed income yields decline. Pension managers, regardless of the nature of their liabilities, have increased allocations to alternative assets and pursued greater geographic diversification through higher allocations to emerging and frontier markets[.]" (State Street Center for Applied Research and The Fletcher School at Tufts University)  

GAO Report Finds Clarity of Required Reports and Disclosures by Private Pension Plans Could Be Improved
"In this report, GAO examined (1) the reports and disclosures pension plans are required to make to government agencies and plan participants; (2) the ways, if any, reports to agencies may be inefficient or ineffective, and (3) the ways, if any, disclosures to participants may be inefficient or ineffective.... GAO asks Congress to consider shifting responsibility and necessary resources to Labor for managing the pension benefit data that SSA provides to retirees. GAO also recommends that the agencies improve their online tools on reporting requirements and facilitate better readability of disclosures." (U.S. Government Accountability Office)  

BrightScope Top 30 401(k) Plans of 2013
"Which traits define the plans that make the Top 30 Plans List? [1] Generous Company Contributions ... [2] Immediate Plan Eligibility: ... [3] Immediate Vesting: ... [4] Low Fees: ... [5] High Participation Rates: ... [6] Salary Deferral." (BrightScope)  

Tune Up Your DC Plan in 2014: Seven Questions for Plan Sponsors (PDF)
"Is the investment policy statement (IPS) too hard to handle? ... Is the fee payment approach past its prime? ... Are target date funds aligned? ... Do the investment vehicles need bodywork? ... Are auto features stuck in neutral? ... Is the DC plan leaking? ... Could participant communications be misfiring?" (Callan Associates)  


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Hiring an Auditor for Your Plan: Cost Should Not Be the Only Consideration
"The plan financial reporting and audit environment is unique in many respects. Auditors must have knowledge of the Internal Revenue Code, ERISA and various IRS and DOL rules and regulations, laws and, of course, the nature of plan operations. These rules add much complexity to an employee benefit plan audit. This complexity requires you to evaluate key indicators that demonstrate the auditor's capacity, competence and expertise." (Fiduciary Plan Governance, LLC)  

PBGC Premium Increases Included in Current Budget Negotiations (PDF)
"The new budget proposal would further raise flat rate premiums to $57 in 2015, $64 in 2016 and index premiums to wage increases thereafter. The 2015 variable rate premiums will increase to $24 plus wage growth per $1,000 of underfunded liability and 2016 rates will increase to $29 plus wage growth from that point on. The individual participant variable rate premium will be capped at $500 in 2016." (Portfolio Evaluations, Inc.)  

Detroit Pension Funds Can Go Straight to U.S. Appeals Court
"U.S. Bankruptcy Judge Steven Rhodes in Detroit, in permitting the pension funds to bypass a review by a U.S. district judge, also said he will decide 'in the next day or so,' whether the appeal should be heard more quickly than normal.... The [city's two pension] systems after the hearing praised Mr. Rhodes' decision to allow the direct appeal and said the challenge should be heard as fast as possible." (Pensions & Investments)  

NCEO Employee Ownership Update for December 16, 2013
Topics include: Supreme Court to Hear Case on Presumption of Prudence; U.K. Increases Incentives for Owners to Sell to Employees; and UBS Study: Experience with Equity Vesting Changes Attitudes. (National Center for Employee Ownership [NCEO])  

Impact of the Great Recession on Retirement Trends in Industrialized Countries
"When the recession began most rich countries were experiencing an increase in labor force participation rates after age 60.... Averaging across all 20 countries in our sample, [the authors] find that the average pace of labor force participation increase was faster after 2007 than before. Countries that experienced unusually severe downturns represent exceptions to this generalization. In most countries, however, the trend toward later retirement not only continued, it accelerated." (The Brookings Institution)  


Text of Comments by American Academy of Actuaries to IRS on Developing Future Mortality Tables for Use Under Section 430(h)(3) (PDF)
"In general, we believe that any changes to reflect new mortality tables for pension funding requirements should continue to include alternatives (such as static tables) in order to simplify administration and valuations, especially for smaller plans. The implied precision of two-dimensional mortality projections scales may not be warranted for many small plans, or for plans that predominantly pay lump sum benefits." (Pension Committee, American Academy of Actuaries)  

GAO Report on 401(k) Plans: Other Countries' Experiences Offer Lessons in Policies and Oversight of Spend-Down Options
"GAO recommends that DOL and Treasury, as part of their ongoing efforts, consider other countries' approaches in helping 401(k) plan sponsors expand access to a mix of spend-down options for participants. GAO also recommends that DOL consider other countries' approaches in providing information about options and regulating the selection of annuities within DC plans. In response, DOL generally agreed with GAO's recommendations and will evaluate approaches." [Report dated November 20, 2013; released December 16, 2013.] (U.S. Government Accountability Office)  


The Moral Hazard of Paltering and Puffery, Part 2
"[T]he medical community minimized the danger of moral hazard by enforcing a strong code of ethics and maintaining a fiduciary standard of care which puts the patient's interest first.... [G]iven the preponderance of paltering in 401k marketing materials, it appears that FINRA's claim that brokerage firms must conduct their business ethically and in accordance with 'high standards of commercial honor and just and equitable principles of trade' is mere puffery." (Mark Mensack, in Thomson Reuters Journal of Compensation & Benefits)  

Benefits in General; Executive Compensation

Supreme Court Upholds Reasonable Contractual Limitations Period in ERISA Plan
"Since ERISA does not impose a statute of limitations for filing claims for benefits, employers sponsoring plans that do not include limitations provisions applicable to such claims should consider amending their plan documents to add a reasonable limitations period. Incorporating a limitations period in the terms of the plan would avoid the imposition of a borrowed state law limitations period (which in some states could be extensive) and would prevent the imposition of different limitations periods in cases where employers are sued in different jurisdictions." (Holland & Knight)  

Supreme Court Holds That a Three-Year Contractual Limitations Period for Benefit Claims Is Neither Unreasonable Nor Contrary to ERISA
"This is a big, unanimous win for contractual limitations periods for benefit claims in an ERISA plan. From the defense perspective, even though this case is about a disability plan every plan sponsor should review all of its ERISA plan documents to determine whether an internal limitations period is appropriate for benefit claims. And from the plaintiff perspective, every claim should be aggressively pursued through the administrative process and then quickly filed in court if denied; there's an undertone in the decision that the delays plaintiff had in pursuing her claim were unreasonable, so it was not unreasonable to apply a limitations period that provided three years from start to finish to exhaust administrative remedies and file suit." [Heimeshoff v. Hartford Life and Accident Ins. Co., No. 12-729 (S.Ct. Dec. 16, 2013)] (James E. Arnold & Associates, LPA)  

Supreme Court Holds that Plan Can Start Limitation Clock Before Benefit Claim Accrues
"The Court had little trouble rejecting any argument that the limitation provision was unreasonably short, given that administrative procedures ordinarily would be completed within about a year, 'leaving the participant with two years to file suit.' The Court left open the possibility that the evaluation could change if substantially less time was expected to remain at the end of a proceeding." [Heimeshoff v. Hartford Life and Accident Ins. Co., No. 12-729 (S.Ct. Dec. 16, 2013)] (Begos Brown & Green LLP)  

Supreme Court Limits Timing of Certain ERISA Claims
"[T]his decision confirms that there are no requirements under ERISA with respect to when a reasonable statute of limitations can begin to run. Employers should check their plan documents to ensure that any limitation on a participant's ability to bring a lawsuit is reasonable, and that the limitation is spelled out unambiguously in the policy. It is also a good idea to include such language in denial of claim letters." [Heimeshoff v. Hartford Life and Accident Ins. Co., No. 12-729 (S.Ct. Dec. 16, 2013)] (Fisher & Phillips LLP)  

ERISA Plan Document Limitations Periods Are Enforceable
"[At oral argument,] the Justices did not seem terribly concerned that the enforcement of ERISA limitations periods poses a serious obstacle to beneficiaries getting their day in court.... Running through the Court's opinion is a clear sense that Heimeshoff could have sued earlier, and indeed that any ERISA beneficiary who truly deserves to be in court has ample time to file a lawsuit, or ample ability to make the case for equitable tolling." (SCOTUSblog)  

Text of Amicus Brief Filed by American Benefits Council Supporting Exemption from FICA Withholding for Certain Severance Payments (PDF)
"When the issue in the case is evaluated not merely from the perspective of the merits of the taxpayer's position on which supplemental unemployment compensation benefits are excluded from taxable wages for FICA purposes, but also from he perspective of the merits of the government's position that relies on the revenue rulings, there can be no doubt that the taxpayer's position is preferable, since the taxpayer's position provides a coherent and sensible answer to the issue, whereas the government does not offer an alternative to the taxpayer's position that is coherent or supportable." [U.S. v. Quality Stores, No. 12-1408 (on petition for certiorari to 6th Cir.; brief as amicus curiae in support of respondent Quality Stores, Inc.)] (American Benefits Council)  

Year-End Financial and Tax Strategies for Restricted Stock, RSUs, and Stock Options
"Unless you were already definitely planning to sell company stock or exercise options soon, most experts feel that unease about higher tax rates in your future should not be the only reason for doing so at the end of the year. However, if you are considering option exercises or stock sales at year-end, you should be aware of the thresholds for higher tax rates and may want to consider keeping your income below them, if possible." (myStockOptions.com)  

CEO Pay Increasingly Performance-Based
"Regardless of how pay is measured, pay for S&P 1500 CEOs was up in 2012 but grew at lower rates than in the previous year. The median increase in target pay -- salary and target cash incentives plus the grant-date value of stock options, restricted stock and performance plans -- was 5.9% in 2012, down from 8.9% the year before. When looking at pay CEOs actually earned -- salary and annual and long-term incentives earned plus the value of vested and exercised awards -- the median increase fell from 19.7% to 11.7% over the same time period." (Towers Watson)  

NASDAQ Proposes Amendments to Compensation Committee Member Independence Rules
"The proposed rule change provides that the board of directors of a listed company may take a director's receipt of any consulting, advisory or other compensatory fees into consideration when assessing the independence of the director for purposes of serving on the company's compensation committee. Therefore, a director would not be automatically disqualified from serving on the compensation committee of a listed company if the director received consulting, advisory or other compensatory fees from the company or any of its subsidiaries." (Holland & Knight)  

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