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March 20, 2014          Get Health & Welfare News  |  Advertise
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Employee Benefits Jobs

DB Administrator
United Retirement Plan Consultants
in NJ

Administrator
Benetech, Inc.
in CA, NC

DC Plan Administrator
The Benefit Advantage
in ANY STATE

Employee Benefits and Executive Compensation Associate
Ballard Spahr LLP
in PA

Pension Administrator
Alliance Pension Consultants, LLC
in IL

Associate Retirement Plan Support
401(k) Advisors
in MA

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Webcasts and Conferences

How to Prepare for a Privacy/Breach Notification OCR Audit or Investigation
March 27, 2014 WEBCAST
(Clearwater Compliance)

U.S. Department of Labor Regulatory Agenda Update
April 2, 2014 WEBCAST
(Worldwide Employee Benefits Network (WEB))

Employer Mandate Delay – Recorded
April 3, 2014 WEBCAST
(Hill, Chesson & Woody)

Employee Benefits Law for Employment Lawyers
April 17, 2014 WEBCAST
(ABA Joint Committee on Employee Benefits)

Derisking: Tradeoff between Reduction in Volatility and Retirement Security
April 24, 2014 WEBCAST
(ABA Joint Committee on Employee Benefits)

Compensation: Understanding All of the Options
May 6, 2014 WEBCAST
(American Society of Pension Professionals & Actuaries (ASPPA))

Public Exchanges: Translating Lessons Learned Into Insurer Strategies for 2015
May 6, 2014 WEBCAST
(Atlantic Information Services, Inc)

How Will Health Care Reform Impact You in 2014?
May 21, 2014 WEBCAST
(Lorman Education Services)

Winning Combinations: Cash Balance & 401(k) Plans
May 22, 2014 WEBCAST
(American Society of Pension Professionals & Actuaries (ASPPA))

Health Care Reform for Employers: Now What?
June 12, 2014 in LA
(Lorman Education Services)

2014 Fall Forum
November 17, 2014 in AZ
(Ascensus)

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]

Required Minimum Distribution Rules for 403(b) Plans
"The required Beginning Date (RBD) for all participants is the later of April 1 after year age 70-1/2 is attained or April 1 of the year after the employee retires. The 5% owner rule, which applies to qualified plans, does not apply to 403(b) plans. For purposes of applying the minimum distribution rules, 403(b)s will be treated like individual retirement annuities.... The surviving spouse of an employee is not permitted to treat a section 403(b) contract of which the spouse is the sole beneficiary as the spouse's own section 403(b) contract." (McKay Hochman)  

If a Plan Merger or Termination Is on the Horizon, Seek Tail Insurance Coverage (PDF)
"While a fiduciary liability policy is in force, it will cover claims reported during the policy period subject to its terms and conditions. However, once the policy expires because it is not renewed or is cancelled, all coverage for future claims relating to acts before the expiration date ceases. Additional protection is available under extended reporting period (ERP) coverage ... However, for terminations and mergers, standard ERP coverage is not enough." (Segal)  

Fidelity Investments Wins Huge in the 'Biggest 401(k) Case in Decades'
"This case validates the DOL's message that employers need to look more carefully at fees, says Fred Reish, an attorney with Drinker Biddle & Reath LLP.... Even though Fidelity is off the hook in this case for fees, Reish questions whether recordkeepers could get fined for excessive fees in the future.... But in this ABB case, the court didn't question Fidelity for its recordkeeping fees. Instead, the court determined that ABB failed to complete its due diligence for the recordkeeping fees paid to Fidelity. In addition, ABB didn't benchmark its recordkeeping fees." [Tussey v. ABB, Inc., No. 12-2056 (8th Cir. Mar. 19, 2014)] (RIABiz)  

Eighth Circuit Splits Rulings on ABB 401(k) Mismanagement, Clears Fidelity
"The decision by the 8th U.S. Circuit Court of Appeals in St. Louis upheld a district-court judgment of $13.4 million to be awarded to the 401(k) participants that said ABB had violated its fiduciary duties by 'failing to control record-keeping costs' ... However, the appeals court vacated another judgment by the district court ordering ABB to pay $21.8 million, based on what the district court said was the financial loss due to mapping one investment, Vanguard's Wellington Fund, in the ABB 401(k) plan to another investment, Fidelity's Freedom Funds... The appeals court remanded this claim back to the district court ... saying that the $21.8 million 'is speculative.' The appeals court also said the district court should 're-evaluate its method of calculating the damage award, if any, for the participants' investment selection and mapping claims.'" [Tussey v. ABB, Inc., No. 12-2056 (8th Cir. Mar. 19, 2014)] (Pensions & Investments)  

Borzi Plays 'Three Questions' with Critics of DOL's Expected Fiduciary Rule
"Borzi ... addressed her first question to confronting claims that a re-proposal could conflict with legal requirements enforced by other agencies and result in 'mass confusion among advisers.' ... Second, she addressed commenters' concerns that the [SEC] and the DOL need to coordinate their regulatory activities regarding fiduciary responsibilities, saying leaders and staff have been constantly meeting each other and that the two agencies renewed in July a five-year memorandum of understanding on development of such regulations.... Third, Borzi questioned why many people want to kill the re-proposal before it's issued." (Bloomberg BNA)  


[Advert.]

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Some Sponsors Should Act by March 31 to Withdraw Individually-Designed Cash Balance Plan Approval Request
"[S]ponsors of individually-designed cash balance plans who have pending Cycle C determination letter applications ... seeking approval of the qualification of their individually-designed plan who now prefer instead to adopt a pre-approved cash balance plan should act quickly to withdraw their pending application. The IRS has announced that these parties can get a refund of the application fee paid for the individually-designed plan application by signing the Form 8905, Certification of Intent to Adopt a Pre-approved Plan, by March 31, 2014 and withdrawing their pending applications for individually designed cash balance plans by May 31, 2014[.]" (Solutions Law Press)  

Auto-Enrollment: Helping Employees Invest in Their Retirement
"Gen X and Gen Y savers (those born between 1965 and 1995) now are making up more than half of the participants in defined contribution plans. As Baby Boomers retire, this increasing trend is likely to continue. However, the total amount of assets held by these generations is still under half of the total defined contribution plan assets. While the number of the Gen X and Gen Y savers are continuing to rise, employers can look for ways to help increase participation of those generations in retirement savings and boost their assets for retirement." (Schneider Downs)  

Do Men and Women Receive the Same Amount of Pension Benefits?
"Benefit rates for men and women were very similar at ages through the early 50s (and in fact, very slightly higher for women), but at age 55, benefits spiked much higher for men than for women. Fifty years old is the age at which Ohio teachers become eligible for early retirement. At age 55, the average man will receive a pension benefit worth 23 percent of lifetime earnings, compared to 19 percent for the average woman. Were women to receive that additional 4 percent in benefits, it would be worth about $70,000 in 2014 dollars." (National Center for Policy Analysis)  

Financial Health of Largest U.S. Corporate Pension Plans Improved Sharply in 2013
"[T]he pension deficit for the 100 largest pension sponsors among U.S. publicly traded organizations fell 57%, from $295.5 billion at year-end 2012 to $125.9 billion at year-end 2013, a decrease of $169.6 billion. The pension deficit for these companies hasn't been this small since 2007, when plans had a surplus of $82.3 billion. Meantime, the overall average funded status jumped 13 percentage points, from 78% at the end of 2012 to 91% at the end of 2013. That is the best funding level since the end of 2007, when the average stood at 103%." (Towers Watson)  

Cumulative List of Non-U.S. Pension Funds Exempted by FATCA Intergovernmental Agreements
"The [Groom Law Group] cumulative list of non-US pension funds exempt from FATCA has been recently updated to cover plans in Finland and Chile." (Groom Law Group)  

British Government Shakes Up Pensions and Savings
"British savers will be given more access to their pension pots and allowed to put away more money tax-free, in what the UK finance minister said was the biggest shake up in pensions in nearly a century. George Osborne [announced] that retirees will not have to buy annuities and be allowed to take more money from their pension pots as a lump sum ... Consultants KPMG called the proposals 'a game changer for the insurance industry', which could now face lower volumes of new business in a 12 billion pound a year market as demand for their annuity products falls away." (Reuters)  

North Carolina Union Calls for Probe of Pension Fees
"An investigator for North Carolina's public employees' union asked the state auditor to look into what it called hundreds of millions of dollars of undisclosed fees paid by the government's pension. The union said Treasurer Janet Cowell is failing to disclose 'all direct and indirect placement fees, asset fees, performance fees and any other management fees' in the $86 billion fund[.]" (Bloomberg)  

[Opinion]

Suggestions for Enhancing DOL's 2012 Fee Disclosures Rules
"[A] standardized format empowers fiduciaries to make more informed provider comparisons.... [T]he current regs do not require providers to disclose the share class of the mutual fund investment provided. Many fiduciaries do not understand that a particular mutual fund may contain different share classes, each with different expenses. This is a loophole that needs to be closed." (Employee Fiduciary)  

[Opinion]

U.K. Budget Changes Mean a Whole New Ball-Game for Pensions
"The [U.K.] Government has not advised on how all this can be achieved nor suggested ways in which the obvious difficulties can be surmounted. Clearly there will be a key role for trustees and employers as well as providers as there will now be increased responsibility on them in this new retirement marketplace.... What does seem certain is that product proliferation is almost inevitable. While it should be welcomed for the flexibility it will bring, it could also lead to a considerable confusion." (Aon Hewitt)  

[Opinion]

Joint Trade Group Letter to U.S. Department of Commerce on Uninterrupted Access to Death Master File (PDF)
"It is critical that access to the DMF remain uninterrupted both during the development of the certification process and while certification applications are pending.... It is essential that any guidance reflect Congress' clear desire to permit continued access for legitimate users of the DMF, including retirement plans and service providers acting on their behalf during the development of the certification program as well as during the application process. In the case of retirement plans, such access is necessary in order to avoid plans paying benefits to the wrong party, and to ensure the timely payment of benefits to the correct party." (The SPARK Institute, ASPPA, American Benefits Council, and 12 other organizations)  

Benefits in General; Executive Compensation

[Guidance Overview]

IRS Employee Plans News, March 19, 2014 (PDF)
Topics include: [1] Cycle C determination letter applicants who intend to adopt a pre-approved cash balance plan may withdraw their applications by May 31, 2014, if they sign Form 8905, Certification of Intent to Adopt a Pre-approved Plan, by March 31, 2014; [2] FAQs on withdrawing Cycle C applications; and [3] Unreasonable assumptions in actuarial certifications of post-retirement medical benefit reserves may have consequences. (Internal Revenue Service [IRS])  

Recurring Benefit Payments and the Statute of Limitations
"This case has potential relevance in situations where actuaries or plan administrators face claims relating to miscalculations many years in the past. The possibility of arguing that the statute of limitations began with the first payment may depend, however, on showing that the recipient disagreed with the benefit calculation at the outset in order to avoid the argument that the statue of limitations only began to run at a later point in time when the recipient 'discovered' the error." [Riley v. Metropolitan Life Insurance Company, No. 13-2166 (1st Cir. Mar. 4, 2014)] (Reinhart Boerner Van Deuren s.c.)  

State Tax Laws 'A Mess' For Same-Sex Couples And Employers
"[Attorney Carol] Calhoun [said] that the situation is 'a mess in a couple of ways. We think of it primarily as to the couples themselves, but it also affects their employers.' She calls it 'an administrative nightmare' in addition to being a burden on the couples and their employers.... Calhoun is also reminding same-sex couples that under some state laws, they may actually pay higher taxes as a married couple." (Carol Calhoun via NPR's Here & Now)  

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