Retirement Plans Newsletter

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Employee Benefits Jobs

Webcasts and Conferences

Higher Ed Retirement Plan Fee Litigation
Nixon Peabody LLP

New FMLA Employer Guide Issued: Time to Check Your Policies and Practices

DOL Issues Guidance on Auto-Enrollment IRAs
September 7, 2016 WEBCAST
Convergent Retirement Plan Solutions, LLC

401(k) Beyond the Basics 09: ACP Testing Techniques
October 11, 2016 WEBCAST
FIS Relius Education

HSA Proliferation in the New Health Care Market
October 13, 2016 WEBCAST

Universal Availability: A Continuing Challenge to 403(b) Plans
October 19, 2016 WEBCAST
FIS Relius Education

8th National Conference on Fully Insured Pension Plans
October 28, 2016 in UT
National Pension Partners

View All Webcasts and Conferences

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[Guidance Overview]

DOL Finalizes, Clarifies, Expands Guidance for State-Run Private Sector Plans (PDF)
"Between the eight states that have enacted legislation and others that are at some stage of program proposal, more than half the states have demonstrated the desire to act to fill this void. In general, these proposals require that all but the smallest employers establish an auto-enrollment payroll deduction IRA savings program if they have no other retirement plan.... If these now-finalized regulations are followed, such state programs will be considered exempt from ERISA and its numerous conditions."


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[Guidance Overview]

Navigating the DOL's New Fiduciary Rules: A Game Plan for Broker-Dealers (PDF)
22 pages. "This [article] discusses: [1] the definition of 'fiduciary investment advice' and the circumstances under which a broker-dealer may be considered a 'fiduciary' when it provides investment advice to 'Retirement Investors'; [2] the exemptions that may be available to broker-dealers that are fiduciaries; and [3] various compliance considerations for broker-dealers seeking to rely on one or more exemptions under the Final Rules."
Dechert LLP

[Guidance Overview]

The New DOL Fiduciary Rule: Impact on Mutual Fund Distribution (PDF)
15 pages. "This [article] addresses the potential impact of the Final Rule on the most common fund distribution channels, including: [1] direct sales; [2] unaffiliated broker-dealers; [3] affiliated broker-dealers; and [4] 401(k) plans and other defined contribution retirement plans."
Dechert LLP

Safeway Sued by 401(k) Participants Over Target Date Fund Fees
"[T]he plaintiffs said Safeway and Empower Retirement breached their fiduciary duties by selecting a target-date fund lineup managed by J.P. Morgan Asset Management (JPMAM) that 'charged excessive fees as compared to readily available alternatives,' the filing said. JPMAM is not a defendant in the lawsuit.... As of Dec. 31, 2014, the Safeway 401(k) Plan had $1.9 billion in assets, according to the company's most recent Form 5500 filing"
Pensions & Investments

District Court Dismisses 401(k) Fiduciary Breach Lawsuit Against Chevron
"The plaintiffs argued that Chevron and members of the 401(k) plan's investment committee breached their fiduciary duties by offering high-cost and underperforming funds, providing a money market fund instead of a stable value fund and paying excessive record-keeping fees to Vanguard Group ... [The judge ruled] that plaintiffs did not raise a 'plausible inference that defendants breached their fiduciary duties and/or duties of loyalty and prudence,' and have until Sept. 30 to file an amended complaint." [White v. Chevron, No. 16-0793 (N.D. Ca. Aug. 29, 2016)]


Help the Pension Rights Center celebrate 40 years of work

Sponsored by Pension Rights Center

Celebrate the Pension Rights Center's 40th anniversary by helping it continue its work to protect and promote the retirement security for American workers, retirees and their families.

Interesting Angles on the DOL's Fiduciary Rule, Part 17
"While there could be a number of ways of satisfying the requirements, ... one way -- and probably a good way -- is to have procedures, forms and services for gathering and evaluating the information and for documenting why the analysis of that information results in a recommendation that the transfer (or not transferring) is in the best interest of the IRA owner. Also, while BICE does not specifically discuss the analysis that needs to be made if the adviser will not be providing 'Level Fee Fiduciary' advice to the IRA, the logical conclusion would be that the requirements are the same[.]"

The Fiduciary Rule Heads to Court
"NAFA argued that FIAs are typically distributed through independent marketing organizations (IMOs), which are not considered to be 'financial institutions' under the BIC Exemption. According to NAFA, IMOs therefore cannot comply with the BIC Exemption, forcing IMOs out of business and cutting off individual investors from an important retirement product. At the hearing, the DOL proposed four solutions to assist IMOs in complying with the rule: [1] insurance carriers could affiliate with broker-dealers; [2] insurance carriers could establish a captive agent model; [3] insurance carriers could outsource some or all of their monitoring duties under the BIC Exemption to affiliated IMOs; and [4] IMOs may seek individual exemptions to become financial institutions under the BIC Exemption."
Miller & Chevalier

Narrowing Investment Offerings on DC Plan Menus: What's the Right Approach?
"This paper seeks to explore the various approaches to menu design and identify how plan demographics and participant behavior can aid in determining what may be most appropriate for a specific plan."
Manning & Napier

IRS Eases Rules for Fixing IRA 60-Day Rollover Mistakes
"Ultimately, the new process won't resolve every possible scenario where an IRA rollover might be late, most notably where the taxpayer just botches the timing by not paying attention, due to aggressively using the rollover as a temporary personal loan, or due to bad advice from a financial advisor. Nonetheless, for what are likely the overwhelming majority of scenarios, the new self-certification process will make it fast and easy for most individuals to fix legitimately innocent rollover mistakes -- though the IRS still reserves the right to evaluate the situation after the fact, and make an adjustment if the individual was not forthright in the process!"
Michael Kitces in Nerd's Eye View

Colleges and Universities Generous with Retirement Contributions
"[According to recent] study of more than 450 private and public higher education institutions ... only 9% of private universities offer a defined benefit (DB) plan and instead utilize defined contribution (DC) plans at 99%. However, most public institutions offer both, with 91% offering both and 87% offering a DB plan.... 77% of all DC plans included contributions almost three times greater than corporate contributions in 401(k) plans. For universities that utilize DC plans, the study finds the median institution contribution to be 9%, with a 25th percentile at 7.1% and a mean contribution of 8.7%."

Employer-Provided Financial Wellness Needs More Than Nudges
"Effective financial wellness programs share characteristics, such as being voluntary and incentive-based. They also typically are supported by employers throughout the year, rather than during open enrollment periods, like other employer-provided benefits."
Bloomberg BNA

Tackling the Risks Faced by Retirees (PDF)
"This paper addresses several key retirement risks that are due neither to poor planning nor to inadequate discipline, and can prove even tougher to address. The paper first describes four important risks that retirees face: longevity, health care, sequence of returns and inflation. It then examines four strategies that can help you mitigate these risks."
Bank of America Merrill Lynch

Public Pensions and Social Security, by State: Where Do Employees Get Both?
"The theory is that for public employees not covered by Social Security their government pensions should be higher (as should the amount they contribute towards their pension). Since we have the raw data from actuarial reports and have now found a website that lists states where public employees are not covered by Social Security ... we can test that theory. As it turns out the top eight states where retirees receive the largest average payouts are all [on the list of those not covered by Social Security]."


California's Smart New Retirement Plan for the Private Sector, and the Industry That Opposes It
"One would think that the asset-management industry would be ecstatic at the prospect of millions of new customers investing tens of billions of dollars. But mutual-fund companies are only happy to bring in new customers if it's on their terms. The Investment Company Institute ... is complaining that California's plan would cap administrative fees ... at 1 percent of the total funds invested. The ICI warns that the plan could be considerably more expensive to manage, and the state could be on the hook for the difference. This is an act of misdirection."
The Atlantic


Private Pensions Mean Public Risks?
"Taxpayers should be worried. State and local pension plans for public sector workers are already exempt from ERISA. Much of the debt they have accumulated is due to the weaker standards under which they operate. Indeed, the states that have gone furthest in studying private pension plans are among those with the most-indebted public-sector pension systems.... The new rules suggest that the Obama administration is shepherding a government takeover of the private retirement market."
City Journal

Benefits in General

[Guidance Overview]

Current Issues Affecting Pension Plan 401(h) Accounts (PDF)
"Section 401(h) account overfunding has given rise to numerous issues for plan sponsors.... Recent developments in financial accounting may affect plan sponsors with 401(h) accounts, too. [The authors] briefly discuss both topics ... and recommend that affected plan sponsors work with legal counsel to identify reasonable approaches to maximize the use of 401(h) account assets consistent with the limited guidance currently available."
Groom Law Group

ERISA Advisory Council to Meet Sept. 27 by Phone
"[T]he 183rd open meeting of the Advisory Council on Employee Welfare and Pension Benefit Plans (also known as the ERISA Advisory Council) will be held as a teleconference on September 27, 2016.... The purpose of the open meeting is to discuss reports/recommendations for the Secretary of Labor on the issues of [1] Cybersecurity Considerations for Benefit Plans and [2] Participant Plan Transfers and Account Consolidation for the Advancement of Lifetime Plan Participation."
Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL]

Executive Compensation and Nonqualified Plans

Recent SEC Enforcement Actions Prompt Consideration of Whistleblower Carve-Outs
"The terms of recent settlements should serve as reminder to any company that falls within the SEC's enforcement jurisdiction (a significantly broader group that just public companies) to consider including provisions in severance and confidentiality agreements to explicitly provide that an employee may communicate with the SEC (and other federal agencies) about potential securities law violations without company approval (notwithstanding other confidentiality and disclosure obligations in the agreement).", a blog by Stinson Leonard Street

Press Releases

Seasoned Executive Joining DCIIA to Lead Operational and Financial Management
Defined Contribution Institutional Investment Association [DCIIA]

Connect   LinkedIn logo   Twitter logo   Facebook logo, Inc.
1298 Minnesota Avenue, Suite H
Winter Park, Florida 32789
(407) 644-4146

Lois Baker, J.D., President
David Rhett Baker, J.D., Editor and Publisher
Holly Horton, Business Manager

BenefitsLink Retirement Plans Newsletter, ISSN no. 1536-9587. Copyright 2016, Inc. All materials contained in this newsletter are protected by United States copyright law and may not be reproduced, distributed, transmitted, displayed, published or broadcast without the prior written permission of, Inc., or in the case of third party materials, the owner of that content. You may not alter or remove any trademark, copyright or other notice from copies of the content.

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