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Employee Benefits Jobs
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Hand-picked links to the web's best news articles,
official guidance, jobs, webcasts and more.
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Crafting a Withdrawal Policy Statement for Retirement Income Distributions
"Similar to an Investment Policy Statement, the goal [of a 'Withdrawal Policy Statement'] is to articulate a series of parameters and guidelines about how retirement withdrawals will be funded from the portfolio, to clarify how to respond when a market calamity strikes and determine, in advance, what steps will be taken to keep the plan on track.... [We] might all say we have a plan to deal with a market decline, but is it really a plan if the guidance about how to fund withdrawals in the midst of market volatility hasn't been written out in advance?"
(Michael Kitces in Nerd's Eye View)
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DOL Investigations: Surviving, Thriving, and Avoiding
"You will not always know why the plan is being investigated.... File building ... demonstrates to EBSA that you in fact know what you are doing.... [P]rovide the information they request (and only the information they request) and do it in a timely manner.... Get professional help if you need it.... Understand the critical importance of internal controls."
(Fiduciary Plan Governance, LLC)
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ERISA Lawsuit Against Morgan Stanley Dismissed by Federal District Court
"[This] 502(a)(3) claim filed against a service provider by the plan sponsor fiduciary itself was a first of its kind case under the umbrella of excessive fee cases.... [T]he court found that a claim against the service provider/party in interest itself would require a claim that the kickbacks were undisclosed. Here, the plaintiffs made no such claim, and the court held that even if they had, the evidence suggested that the Additional Compensation was disclosed.... [T]he court made clear that avoiding harmful scenarios as alleged by the plaintiffs, is in fact, the fiduciary's responsibility as long as it is disclosed." [Skin Pathology Associates, Inc. v. Morgan Stanley & Co., Inc.,
No. 13 Civ. 3299 (AT) (S.D.N.Y. Feb. 24, 2014)]
(FRA PlanTools, LLC)
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Recent Pension Legislative Proposals
"Senator Collins's (R-ME) Retirement Security Act of 2014 (RSA 2014)... would allow: [1] A MEP to be treated as satisfying Tax Code qualification requirements despite a violation with respect to one or more participating employers. [2] 'Qualified' MEPs to cover employers that do not share a common interest. A qualified MEP generally only covers employers with 500 or fewer employees.... [The proposal would also] add a new 401(k) automatic enrollment safe harbor using higher default contribution rates than under current rules ... [and] includes a tax credit for small employers establishing this sort of safe harbor."
(October Three Consulting)
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IRA, 401(k), 529: What's the Best Tax-Sheltered Account Type for You?
"[G]iving due care to the wrapper you choose for your investment accounts and maximizing your investments in tax-sheltered vehicles can greatly enhance your take-home return.... Here's an overview of the various types of savings vehicles available for your long-term investing assets -- especially retirement -- including a summary of the types of individuals who will tend to benefit most from each investment vehicle. Note that there's not a single best investment wrapper for any one individual; most savers will hold a combination of these account types during their lifetimes."
(Morningstar)
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One-Third of Americans Are Not Familiar with Their Retirement Plan Investment Options
"One-third (33 percent) of Americans who participate in an employer-sponsored retirement plan say they are not familiar with the investment options in their plan ... 37 percent of women [state] they are not familiar compared to 29 percent of men.... 43 percent of Gen Y respondents stating they are not familiar with their plan options.... Twenty-eight percent of survey respondents stated they do not understand all of their choices for how to invest their money in their retirement plan. More than one-third (36 percent) feel they have either too many or too few investment choices."
(TIAA-CREF)
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Improving Public Pensions: Balancing Competing Priorities (PDF)
"It is clear that there is no one specific policy that will solve the problems of every state and local pension plan, as priorities and constraints vary widely, but ... any well-designed pension plan will strive to meet three goals: providing retirement security to workers, ensuring fiscal sustainability, and maintaining or improving the productivity of the public-sector workforce....[E]xisting defined-benefit pension systems largely fail to meet these goals by providing retirement security to some workers but not others, creating incentives for underfunding that many states have failed to resist, and embedding incentives for workers to stay in or quit the workforce that are difficult to justify."
(Brown Center on Education Policy at Brookings)
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Pension Politics: Public Employee Retirement System Reform in Four States (PDF)
"Recommendations drawn from this analysis include: Avoid turning pension reform into an ideological issue ... States need a credible and visible reform champion ... Reform advocates must gather and disseminate accurate data, and clearly communicate the reality of their state's pension liabilities ... Demonstrate pensions' impact on taxes and other state spending priorities ... Sell the benefits of pension reform to state workers ... Sell the benefits of pension reform to school reformers ... Anticipate and plan for legal challenges."
(Brown Center on Education Policy at Brookings)
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Survey of Supplemental Retirement Plans Offered by 20 City and County Governments
"Fifteen of the local government employers offer only one type of plan; all 20 local government employers in the study offer at least one 457 savings plan. Most plans allow loans. Employers match employee contributions in just four plans. Employees need more financial literacy and good information about plans to make optimal decisions when they have more choices to make. More choices for employees may not be better if the quality of the plans, in terms of fees and investment options, is inferior to the quality of a more restricted access model."
(Center for State & Local Government Excellence)
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Retirement Security in an Aging Society
"The share of the U.S. population over the age of 65 was 8.1 percent in 1950, 12.4 percent in 2000, and is projected to reach 20.9 percent by 2050. The percent over 85 is projected to more than double from current levels, reaching 4.2 percent by mid-century.... The trend from private sector defined benefit to defined contribution pension plans has shifted a greater share of the responsibility for retirement security to individuals, and made that security more dependent on choices they make. A significant subset of the population is unlikely to be able to sustain their standard of living in retirement without higher pre-retirement saving."
(National Bureau of Economic Research [NBER])
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2014 Social Security Quick Fact Sheets
"This set of fact sheets and easy-to-read corresponding infographics provides a one-page overview of quick facts on Social Security benefits and beneficiaries for each of the 50 states, Puerto Rico, the U.S. Virgin Islands, and the District of Columbia. Information is provided about each state's older population, Social Security beneficiaries, Social Security benefits, Social Security's role in lifting retirees out of poverty, Social Security's impact on the state economy, and the Percent of Social Security as the only source of income among older residents."
(AARP)
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Text of Request for Public Comments on Certification Program for Access to Social Security Death Master File (PDF)
"Section 203 of the Bipartisan Budget Act of 2013 directed the Secretary of Commerce to establish a certification program under which persons may obtain immediate access to the publicly available Death Master File (DMF). The National Technical Information Service is requesting comments from the public regarding the establishment and implementation of a certification program for access to the DMF. It is expected that information gathered through this RFI will inform NTIS's approach to the development of a certification program, which will be promulgated by NTIS by Notice and Comment Rulemaking.... Comments are due on or before 5:00 pm Eastern time [15 days after this Notice appears in the Federal Register]. The public meeting will take place on Tuesday, March 4, 2014[.]"
(National Technical Information Service, U.S. Department of Commerce)
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[Opinion]
Will Facebook Do an About-Face on Its Puny 401(k) Policy?
"Facebook offered no matching contribution to its employees' 401(k) accounts in 2012 and 2013 ... Whole Foods' match is only a measly $152 a year based on a formula of 15.2 percent of the first $1,000 that workers contribute.... While AOL's about-face on its original decision to switch from regular-paycheck 401(k) contributions to once-a-year contributions is refreshing, it doesn't make up for the fact that most 401(k) plans are not adequate no matter how frequently you get the money, given that the employer contribution is only equal to 3 percent of pay compared to 8 percent of payroll for a pension."
(Jane White in The Huffington Post)
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Benefits in General; Executive Compensation
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[Guidance Overview]
IRS Issues Final Regs Under Section 83
"Despite one commenter's concern that the regulations narrow the circumstances that would establish a substantial risk of forfeiture under IRC Section 83, according to the Treasury and the IRS, the clarifications set out in the regulations are consistent with the IRS's historical interpretations and therefore do not represent a change."
(Practical Law Company)
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Final Substantial-Risk-of-Forfeiture Rules Are Released
"The new regulations clarify that [1] a substantial risk of forfeiture may be established only through a service condition or a condition related to the purpose of the transfer; [2] in determining whether a substantial risk of forfeiture exists based on a condition related to the purpose of the transfer, both the likelihood that the forfeiture event will occur and the likelihood that the forfeiture will be enforced must be considered; and [3] except as specifically provided in Sec. 83(c)(3) and Regs. Secs. 1.83-3(j) ... and 1.83-3(k) ... transfer restrictions do not create a substantial risk of forfeiture."
(Journal of Accountancy)
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The Impact of Section 409A on Severance Payments
"The concern with conditioning severance pay on an executive signing a release is that if there is no time limit on when the release must be signed, the employee can affect the timing of payment by either signing the release quickly or delaying to a later date. This violates the strict requirements of 409A. It is important to recognize that it is not the employee's action or inaction that is the problem; it is the provision in the employment agreement."
(Drinker Biddle)
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Press Releases
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