Today's News from BenefitsLink

If this message looks garbled to you or if the headlines in this message don't connect you to Web pages when you click on them, please request the "plain text" version of this newsletter ("Retirement Plans Edition") by emailing your request to publisher Dave Baker

The BenefitsLink Newsletter -
Retirement Plans Edition

January 29 and 30, 2001

Today's sponsor is EmployeeBenefitsJobs.com (click on banner for more information)

( Would your company like to sponsor an issue? )

Thousands Protest Across France Over Pension Funds
Excerpt: "Tens of thousands of workers and retirees took to the streets across France on Thursday, paralyzing transportation in some major cities in a protest directed at protecting pensions. In a rare gesture of solidarity, public sector trade unions joined private-sector employees who are protesting plans to change the way pension funds are run." (Association Press, via International Herald Tribune)

Pension Reform Passes Hurdle in Germany
Excerpt: "The lower house of Parliament on Friday passed a long awaited measure to overhaul the country's costly state retirement system, but only after a two-year effort that exposed the complexities of European welfare reform." (International Herald Tribune)

French Strike Over Lengthening of Normal Retirement Age Causes Transit Chaos
Excerpt: "Strikes across France brought transportation chaos Thursday as tens of thousands of people joined protests by unions against a bid by the main employers' federation MEDEF to push the retirement age beyond 60." (Associated Press, via Excite!)

Strategies for Income with Respect to a Decedent
Excerpt: "Qualified pension profit-sharing, 401(k) plans, and various IRA alternatives continue to be the most efficient vehicles for deferring taxes and saving for retirement. Upon death, however, not only will these assets be subject to significant estate taxes but beneficiaries will also be liable for taxes on income with respect to a decedent (IRD)." (CPA Journal)

Employee Ownership Update for January 26, 2001
NCEO executive director Corey Rosen discusses new defined contribution limits, the IRS's 2-year moratorium on demanding withholding with respect to incentive stock options and ESPPs, new rules for ERISA summary plan descriptions, and the outlook for legislative changes for employee stock plans. (The National Center for Employee Ownership)

Savannah City Council Approves Pension Plan Lowering Normal Retirement Age to 57 for City Employees
Excerpt: "The new plan lowers the retirement age to 55 for police and firefighters, and 57 for general employees. The pension benefit formula will allow employees to accumulate 2.1 percent of their final average salaries for each year of service prior to 2000, and 2.3 percent thereafter up to a maximum of 30 years. Any years served after that will be credited at 1 percent per year." (Savannah [Ga.] Morning News)

Congressman Leads New Charge to Rewrite Federal Govt. Pension Formula Involving Part-Time Hours
Excerpt: "Congress approved a formula change in 1986, partly to prevent part-time employees from gaming the system by working full time in their last years before retirement to receive a higher benefit. By most accounts, Congress intended to exempt existing employees at the time so they could not claim that the rules were being changed on short notice or unfairly. But congressional intent got lost in the process of writing the regulation." (Washington Post)

Winter 2001 Newsletter of National Association of Govt. Deferred Compensation Administrators (PDF)
(NAGDCA)

Summary: IRS Modifies and Expands Correction Programs (EPCRS)
Excerpt: "The modified EPCRS consolidates several correction programs, expands the types of plans eligible for EPCRS, and authorizes new correction methods. Revenue Procedure 2001-17 is generally effective May 1, 2001. However, an employer may elect to use the new procedures any time after January 19, 2001 (the date they were released)." (EBIA Weekly)

IRS Clarifies Rules on Remedial Amendment Period for M&P, Volume Submitter Plans
Excerpt: "... an extension of the deadline is available to employers using certain Prototype and VS plans. If the extension applies, then employers must update their plans for GUST by the later of (1) the general RAP (i.e., the end of the 2001 plan year) or (2) the twelfth month beginning after the date the last Prototype or VS of the Prototype sponsoring organization or VS practitioner is approved for GUST (this is referred to as the "12 month rule")." (Corbel)

Employers' Association Proposes Modifications To Notice Provisions In Pension Reform Legislation
Excerpt: "The ERISA Industry Committee appreciates the opportunity to comment on your comprehensive pension reform legislation (H.R.1102, 106th Congress) prior to its re-introduction in the 107th Congress. The comments below focus on the several notice provisions in the bill ... that change, add, or eliminate notices that plan sponsors must send to plan participants about the plans in which they participate." (ERISA Industry Committee)

401(k) Substitutes for Small Business Owners
Excerpt: "The first step in choosing a retirement savings vehicle is to define your status. Are you self-employed or a small business owner? The distinction is not always obvious. A self-employed individual may or may not have employees, while small business owners may or may not be incorporated and may have no employees or only up to 100. This panoply of variations often leaves these folks scratching their heads and wondering what's the best tool to use." (401Kafe.com)

5 Step Participant Retirement Statement Review
Excerpt: "A little known fact about many 401(k) and IRA accounts is you have a short window of time to review your statements before it's too late. Too late to make changes, that is. And far more reports are incorrect than you may think." (Greg Hanna's Retirement Planning page on About.com)

When Money Managers Are "Sanctioned" By The SEC: 3 Tips To Protect Pension Funds
January 2001 issue. Excerpt: "What can you do when you hear one of your managers may be in trouble with the SEC?" (Benchmark Financial Services, Inc.'s Alert)

CD Brokers Aren't 'Registered' Anywhere
Second of two parts. Excerpt: "There's a bad business going around. People who advertise themselves as 'registered CD brokers' are mis-selling certificates of deposit to trusting savers." (Jane Bryant Quinn in the Washington Post)

German Lawmakers Approve Pension Reforms
Excerpt: "Germany's lower house of parliament passed a long-delayed overhaul of the national pension system Friday after a storm over an opposition poster depicting Chancellor Gerhard Schroeder as a criminal accused of 'pension fraud.'" (Associated Press, via Excite!)

Social Security Fixes Don't Top Bush's To-Do List
Excerpt: "With the economy slowing and the stock market sagging, it doesn't seem like an opportune time for President Bush to pursue his plan to let workers invest some of their Social Security taxes in Wall Street." (USA Today)

(Following also appears in Welfare Plans Edition)

Benefit Costs Up 5.6 Percent in 2000
Excerpt: "Employee benefit costs for private industry-- including those involving paid leave, retirement, and insurance benefits-- rose 5.6 percent in 2000, according to figures just released by the U.S. Department of Labor's Bureau of Labor Statistics." (CFO.com)

Chao Confirmed as DOL Secretary by Unanimous Consent
Excerpt: "Chao was warmly welcomed during confirmation hearings before the Senate Health, Education, Labor and Pensions Committee last week. She was introduced by a bipartisan group of lawmakers that included her husband, Sen. Mitch McConnell (R-Ky.)." (Chicago Tribune)

Graef Crystal: Compensation Experts Must Change Their Game Plan
Excerpt: "Compensation consultants will need retraining if the stock market is to regain its buoyancy. Their actions, left unchecked, are likely to dampen corporate earnings growth and drain money from shareholders. The reason lies in the way most consultants determine how large an option grant executives or employees ought to receive." (Graef Crystal, on Bloomberg.com)

Stock Option Tax on Hold
Excerpt: "As a temporary solution to a controversial issue, the IRS announced a two-year moratorium [January 18] on its collection of payroll and withholding taxes on ESPPs and ISOs." (CFO.com)

White House Delays Effective Date of Recently Published Regulations
Excerpt: "This action temporarily dams the flow of regulations that have flooded the employee benefits community ... a torrent of regulations addressed such topics as ERISA claims procedures and summary plan descriptions; HIPAA health care privacy and nondiscrimination; national medical child support notices; cafeteria plan elections; transportation fringe benefits plans; COBRA; required minimum distributions; and electronic notices to interested parties." (EBIA Weekly)

Job Openings Newly Posted or Reposted on EmployeeBenefitsJobs.com

Conversion Specialist

for State Street Research
in MA

Client Service Manager

for ING-Aetna Financial Services
in CT

Senior Benefits Analyst

for The Benefits Group, Inc.
in CA

Benefits Manager

for Pillsbury Winthrop LLP
in CA, DC, NY, VA

Stock-Based Executive Compensation Attorney

for Law Firm with 20 Exec.Comp/Benefits attorneys
in CA, CO, DC, WA

401(k)and Investment Sales

for http://www.401k-recruiter.com
in DC, GA, NC, TN, VA

Assistant Executive Director

for Employees' Retirement Association, County of Kern
in CA

Financial Consultant

for The Stratevest Group
in NY

Benefits Assistant

for West-Coast affiliate of a specialty retailer of fine jewelry.
in CA

Pension Paralegal

for Reid and Riege, P.C.
in CT

Pension Consultant/Administrator

for Gorrelick, Tievy & Associates, Inc. in MD (DC Suburbs)
in MD

Compliance Associate

for BISYS Plan Services
in PA

Administrative Assistant

for BISYS Plan Services
in PA

Employee Benefits Specialist

for BISYS Plan Services
in PA

Form 5500/ Audit Team Leader

for Benefit Services Corporation, a subsidiary of METLIFE, is a 401(k) plan administrator with 30 years of specialized experience in defined contribution recordkeeping.
in GA

Retirement Specialists

for KeyBank
in OH

Employee Benefits Conferences Newly Posted on BenefitsLink

Web-Based Communication

in MD on February 15, 2001
presented by The Baltimore Chapter of ISCEBS

M & A Tips from the Trenches

in CA on March 7, 2001
presented by Western Pension & Benefits Conference, San Francisco Chapter

Common Myths of Investment Education Programs

in CA on March 14, 2001
presented by Western Pension & Benefits Conference, San Francisco Chapter

Membership Appreciation Night featuring a Social Security Debate

in CA on April 17, 2001
presented by Western Pension & Benefits Conference, San Francisco Chapter

Overview of Current Legal Decisions

in MA on March 6, 2001
presented by Greater Boston Chapter: Intl Society of Certified Employee Benefit Specialists