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Retirement Plans Newsletter

December 12, 2022

3 New Job Opportunities 3 New Job Opportunities

 

401(k)ology: Annual Match 'True Up'

"Annual true up contributions are a good thing for plan participants because the provision ensures that each participant receives the full match for the plan year regardless of when they make deferrals throughout the year.... [This article takes] a deeper dive into what a true up contribution provides and review how the true up provision can be a benefit for your participants."  MORE >>

Newfront

Ninth Circuit Affirms Dismissal of ERISA Suit Alleging Boeing Wrongfully Distributed Investment Plan Account

"Plaintiff alleged that ... Boeing did not inform her that the Plan would require a distribution ... of her beneficiary account by no later than December 2018. She further alleged that Plan representatives had discouraged her from rolling her account over to an [IRA] because of an anticipated increase in the price of Boeing stock.... The court explained that [the plaintiff] does not adequately allege facts to establish that the Appellees violated ERISA or the terms of the plan or that [they] breached their fiduciary duty[.]" [Kopelev v. The Boeing Company, No. 21-55937 (9th Cir. Dec. 9, 2022)]  MORE >>

Roberts Disability Law

Measuring Pension Obligations for Difficult-to-Value Plan Provisions (PDF)

61 pages. "The purpose of the practice note is to provide information to actuaries on current or emerging practices in which their peers are engaged regarding defined benefit pension plan provisions that may be difficult to adequately measure using traditional valuation procedures, as well as to provide a framework for thinking about appropriate valuation procedures in this area and to help with the evolution of ideas and practices."  MORE >>

American Academy of Actuaries

Mutual Fund Revenue Sharing in 401(k) Plans

"Recordkeepers in DC pension plans are often paid indirectly in the form of revenue sharing from third-party funds on the menu.... Overall, revenue-sharing plans are more expensive as higher expense ratios are not offset by lower direct fees or by superior performance. Rebates increase with the market power of the recordkeeper suggesting that third-party funds may revenue share to gain access to retirement assets."  MORE >>

National Bureau of Economic Research [NBER]; purchase required for full document

Morningstar Advises 3.8% 'Safe' Withdrawal Rate

"Morningstar's annual model of how much a retiree with a balanced portfolio should withdraw over a 30-year time horizon increased to a starting point of 3.8% on the back of higher bond yields and lower equity valuations. The investment data and insights provider said the return outlooks were appreciably higher than last year, when the firm recommended a 'safe' withdrawal rate of 3.3%. That rate made waves at the time because it went against the industry standard of a 4% withdrawal rate for a retirement portfolio balanced roughly 50-50 between stocks and bonds."  MORE >>

PLANSPONSOR; free registration may be required

PBGC Approves $227 Million Additional SFA for Graphic Communications Plan

"[PBGC] has approved the supplemented application submitted ... by the Graphic Communications Conference of the International Brotherhood of Teamsters National Pension Plan. The plan, based in Carol Stream, Illinois, covers 31,715 participants in the printing industry.... The Graphic Communications Plan will receive approximately $227.1 million in supplemented SFA, which is in addition to $1.29 billion in SFA approved for the plan by PBGC in April 2022 under the interim final rule."  MORE >>

Pension Benefit Guaranty Corporation [PBGC]

PBGC Approves $126 Million Additional SFA for FELRA Pension Plan

"[PBGC] has approved the supplemented application submitted ... by the Food Employers Labor Relations Association and United Food and Commercial Workers Pension Plan. The plan, based in Landover, Maryland, covers 51,500 participants in the service industry.... The FELRA Pension Plan will receive approximately $125.7 million in supplemented SFA, which is in addition to $1.24 billion in SFA approved for the plan by PBGC in April 2022 under the interim final rule."  MORE >>

Pension Benefit Guaranty Corporation [PBGC]

[Opinion]

401(k) Litigation Trends to Watch in 2023

"If someone seeks cert for SCOTUS to address the 'apples and oranges' and burden of proof issues.... the First Circuit's Brotherston decision, and the amicus brief filed with SCOTUS by the Solicitor General in connection with Putnam's appeal, together provide sufficient legal arguments and evidence to discredit both of said issues ... Judge Sutton's endorsement of 'controlled' discovery may reduce the number of 401(k) actions and allow more cases to be decided on the merits than on a questionable procedural basis."  MORE >>

The Prudent Investment Fiduciary Rules

Executive Compensation and Nonqualified Plans

[Guidance Overview]

Oh Won't You Stay ... Until the Bonus Is Paid

"[The Colorado [DOL] and Employment (CDLE)] interprets the Colorado Wage Act as prohibiting an employer from requiring the employee be employed on a certain date in order to receive a bonus, if all other conditions to receive the bonus have been met.... Since [retention] bonuses are typically designed to be exempt from 409A tax rules under the 'short term deferral' exception which requires there to be a 'substantial risk of forfeiture,' this could mean that there is no longer a substantial risk of forfeiture."  MORE >>

Holland & Hart LLP

2022 Top 250 Annual Incentive Plan Report (PDF)

27 pages. "[This report] covers annual incentive plan design practices among the 250 largest companies in the S&P 500 by market capitalization.... This report focuses on understanding how annual incentive plans are currently designed and how they have evolved over a three- and six-year lookback period "  MORE >>

FW Cook

Employee Benefits Jobs

View job as Defined Contribution Consultant
            for Aon

Defined Contribution Consultant

Aon

Remote / CT / FL / GA / MN / NJ / NY

View job as Defined Contribution Consultant for Aon

View job as Pension Administration Senior Specialist
            for Southern California Edison

Pension Administration Senior Specialist

Southern California Edison

Rosemead CA

View job as Senior Advisor of Wealth Plan Administration
            for Southern California Edison

Senior Advisor of Wealth Plan Administration

Southern California Edison

Rosemead CA

Selected New Discussions

Contributions in Other Than Cash

"I have some general knowledge on this - I know property can't be contributed to a DB plan - but can't seem to figure out where to research more deeply. A sole proprietor is asking if he can contribute CDs by transferring them. I think the answer is no but need to be pointed in the right direction. There are certainly issues having to do with potential gains and losses at the point of transfer, but might CDs be considered "cash"?"

BenefitsLink Message Boards

Retiree Death Benefits

"I have a few clients who provide an unfunded death benefit for their retired employees. It is a relatively small amount ($2,000-3,000), but not small enough to qualify for the remembrance fund exception under ERISA. I am curious how other handle the 5500 filings for these benefits. These are larger employers, so there's a high participant count. Do you typically see these programs having their own filing, or wrapped with other welfare benefits? Does the large participant count create issues? (Since it is difficult to track the number of retirees at any given time and enrollment is not required to be covered.)"

BenefitsLink Message Boards

Press Releases

Wolters Kluwer Launches New Plan Design Summary Tool on ftwilliam.com

Wolters Kluwer

TRI-AD and Navia Benefit Solutions Announce New Partnership

TRI-AD

U.S. Senators Ben Cardin and Rob Portman Receive the Ray Lillywhite Award for Their Dedicated Work on Strengthening Retirement Security for Workers and Retirees

EBRI [Employee Benefit Research Institute]

Webcasts and Conferences
(Retirement Plans / Executive Compensation)

SECURE 2.0 - It's Here and Time to Re-SECURE Your Knowledge

January 24, 2023 WEBCAST

ASPPA [American Society of Pension Professionals & Actuaries]

ERISA Successor and Affiliate Liability in Asset Sales and Distressed Benefit Plans

February 1, 2023 WEBCAST

Strafford

Executive Compensation and the New SEC Dodd-Frank Clawback Rules: Key Provisions, Consequences of Noncompliance

March 1, 2023 WEBCAST

Strafford

Last Issue's Most Popular Items

More Hackers Going After Retirement Savings

planadviser

Comprehensive Summary of 2023 Benefit-Related Cost-of-Living Adjustments (PDF)

Mercer

Bicameral, Bipartisan Retirement Bill Introduced

American Retirement Association [ARA]

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BenefitsLink Retirement Plans Newsletter, ISSN no. 1536-9587.

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