Retirement Plans Newsletter

September 15, 2016 logo logo LinkedIn logo Twitter logo Facebook logo
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Employee Benefits Jobs

Webcasts and Conferences

Retirement Forum, Twentieth Anniversary Celebration and HERO Awards Reception
September 20, 2016 in DC
WISER [Women’s Institute for a Secure Retirement]

DOL's Proposed Form 5500 Modernization Initiative
October 6, 2016 WEBCAST
ASPPA [American Society of Pension Professionals & Actuaries]

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[Guidance Overview]

Avoiding the Pitfalls of the Multiemployer Pension Plan Amendments Act (PDF)
"This article identifies and addresses the dangerous 'traps' of MPPAA that employers will confront immediately after an assessment of withdrawal liability and suggests practical strategies to preserve an employer's ability to contest its withdrawal liability.... MPPAA contains unwieldy and often incomprehensible time limits. Failure to meet those time limits can preclude an employer from contesting its withdrawal liability assessment."
Jackson Lewis, P.C., via Wolters Kluwer Law & Business


ERISA 3(16), 3(21) & 3(38) Fiduciaries: What you Need to Know!

Sponsored by ASC

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Modernizing Multiemployer Pensions: Questions and Answers About the Composite Plan Proposal
"Would the retirement plans created under the proposal be defined benefit or defined contribution retirement plans? ... Does the proposal weaken current funding standards for traditional multiemployer pension plans? ... Will existing multiemployer pension plans facing severe financial challenges be able to transition to the composite plan design? ... Does this proposal allow employers to escape their responsibilities to their traditional multiemployer pension plan? ... Will this proposal exacerbate the fiscal challenges facing the PBGC?"
Committee on Education and the Workforce, U.S. House of Representatives

Pension Policy at a Crossroads (PDF)
"The purpose of this issue brief is to examine the candidates' positions and views on pensions and social and economic security."
National Conference on Public Employee Retirement Systems [NCPERS]

How to Prepare for an IRS Audit of Your 403(b) or 457(b) Plan (PDF)
13 pages. Includes: [1] How employers can prepare for an IRS Audit of their 403(b) and/ or 457(b) Plan, [2] potential areas of focus during an IRS examination, and [3] best practices for strengthening tax compliance.
National Association of Government Defined Contribution Administrators [NAGDCA]

401(k) Defaults Evolve Using TDF-Managed Account Hybrid
"The product harnesses the idea of automatic enrollment to automatically shift target-date fund investors into a managed account upon a 'triggering' event such as age, employer tenure or account balance ... The automatic shifting from target-date funds to managed account ... would mark an evolution of sorts in the conversation around default investing in 401(k) plans. However, some question whether managed accounts are truly the best option for everyone and whether the default route is a sound approach."
Pensions & Investments


The Advisor's Guide to Qualified Plans

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The Evolving DC Plan: From Accumulation to De-accumulation (PDF)
"[T]op employers need to find new ways to differentiate their benefits by meeting employees' evolving needs.... [O]ne of the next evolutions of plan design will be the distribution options offered by employers to their employees as part of their defined contribution (DC) plans.... De-accumulation strategies can advance the employer's goal of effectively managing their human resources, by motivating high performance and enabling orderly, 'on time' retirement, while giving their employees access to good, institutionally priced products and services."
Institutional Retirement Income Council [IRIC]

Sustaining Retirement Income in a Lower-Return World
"[U]sing the dynamic spending strategy, a retiree can capture a large part of the sustainability benefits of the percentage of portfolio strategy, but without the strategy's considerable volatility in annual spending. Ultimately, an investor with endless flexibility would choose the percentage of portfolio approach for its 100% success rate; however, for most retirees this is simply not practical. In that case, dynamic spending can provide many of the benefits of percentage of portfolio without giving up the relatively consistent level of real annual spending."

GAO Report: Improvements to Social Security Claims Process Could Help People Make Better Informed Decisions about Retirement Benefits
"This report examines [1] the extent to which people understand Social Security rules affecting their retirement benefits; and [2] what information SSA provides to individuals to enable them to make informed claiming decisions.... GAO is making six recommendations to SSA, including that SSA take steps to ensure that claims specialists provide information on delayed benefits ... and that the claims process provides claimants better information on the retirement earnings test." [Also see GAO Testimony to U.S. Senate Special Committee on Aging.]
U.S. Government Accountability Office [GAO]

DuPont Offers Lump Sums, Early Pension Payments to Former Employees
"The offer is targeted to roughly 18,000 former employees who left the company or its subsidiaries by Dec. 31, 2015, and are fully vested but have not started collecting benefits."
Pensions & Investments


What a Recent Retirement Survey Says About Retirement Outlook
"According to the survey, the average Baby Boomer didn't start saving for retirement until 35 years of age. Generation Xers fared much better in that category, beginning to save for retirement, on average, at 28. Hands down though, millennials win the prize here, starting to save for retirement at an average age of just 22! Given the increased life expectancies that millennials will likely enjoy relative to Generation Xers and Baby Boomers, that early start is especially important."
Slott Report


Are Hospital Plans Sick And University Plans Dumb? (PDF)
"The lawsuits consistently focus on determining 'the floor' of minimum costs that they say a plan should incur. The plaintiffs typically do not discuss whether the plan costs are at the median, rather they seem to believe all plans are 'commodities' of the same basic services and results. The plaintiffs also assume all the same outcomes in terms of retirement readiness and believe any costs above the floor 'are wasted.' They seldom, if ever, mention differences in retirement readiness in their arguments."
Unified Trust Company, N.A.


American Retirement Association Comment Letter to EBSA on Proposed Revisions to Form 5500 (PDF)
"ARA recommends that the public comment period be extended by 105 days to January 17, 2017.... ARA recommends that additional time be provided to transition into the significant technology changes the Proposal will require and that the effective date should be deferred to allow for consideration of public comment as to ways information can be collected in a less costly and burdensome manner.... ARA recommends that the Agencies hold a public hearing on the Proposal."
American Retirement Association [ARA]

Benefits in General

Discretion and Preemption: Unraveling ERISA, State Insurance Law
"While the California federal court ... acknowledged the existence of the deemer clause, the court still found the California ban on discretionary clauses applicable based on a finding that '[S]ection 10110.6 applies to contracts.' But that finding directly conflicts with ERISA's preemption provision, which has federalized garden-variety disputes over health and disability benefits and removed claims relating to such benefits from the ambit of breach-of-contract actions even where such benefits are provided though insurance." [Thomas v. Aetna Life Ins. Co., No. 15-1112 (E.D. Cal. Aug. 15, 2016)]
DeBofsky & Associates, P.C.

Cost of Employee Benefits for Private Industry Employers in the Northeast: $13.34 Per Hour in June 2016
"In June 2016, employee benefits cost private industry employers in the Northeast $13.34 per hour worked, the highest of the four U.S. census regions... Employee benefits costs were lowest in the South, where employers spent $8.50 per hour worked.... Nationwide ... employee benefits cost employers $9.77 per hour."
U.S. Bureau of Labor Statistics [BLS]

Collected Comment Letters Submitted to DOL on Notice of Proposed Form 5500 Revisions
Text of 23 comment letters submitted as of today; page will be updated as additional comment letters are submitted.
Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL]

Press Releases

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