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
Jobs | Today's Messages | Topical News | Q&A Columns | Services & Products | Search | Reference
October 10, 2001 - 12,199 subscribers
Today's sponsor: ASPA
(Click on company name or banner to learn more.)
(Help BenefitsLink to provide this newsletter at no charge to you -- our sponsors pay our way. Remember to visit them periodically; we try to make sure their products and services will be of interest to you. Thanks! --Editor)
October 15th Deadline to Recharacterize Roth IRA Back to Traditional IRA
Excerpt: "Are your clients worried about the traditional IRA they converted to a Roth IRA back in 2000-- that may now be worth substantially less money? Perhaps reversing the conversion--placing the funds back into a traditional IRA-- is the best treatment of the funds." (National Underwriter)
IRS Begins Issuing GUST Letters for M&P Plans
Excerpt: "The Service has begun to issue opinion letters to sponsors of master and prototype (M&P) plans who applied for GUST opinion letters by December 31, 2000.... the Service will soon publish on the IRS Web-page a list of the M&P plans and volume submitter specimen plans that were timely submitted for GUST opinion and advisory letters." (Internal Revenue Service)
Can You Retire on Time Despite Market Turmoil?
Excerpt: "No stock-market seer can be certain when the market will reach a bottom. It may already be there for all anyone knows. But even the smallest mutual-fund investor has a surefire way to buy stocks close to their lowest levels. It's simple: Just stick to a plan of buying stock-fund shares in regular installments through a 401(k) retirement plan or other investment account." (CareerJournal.com)
401(k) Plans in Good Conscience: Socially Responsible Funds
September 2001 issue. Excerpt: "Participant demand and new, low-expense offerings help socially responsible funds to catch on." (PLANSPONSOR.com; free registration required)
Assessing the New Contribution Catch-Up Rules
September 2001 issue. Excerpt: "One of the better-known parts of the new tax bill is its provision for plan participants over the age of 50 to set aside additional funds for retirement-above and beyond their regular savings. While many in the press touted that group's ability to sock away an extra $5,000 per year, the reality is that it will be several years before that much can be set aside." (PLANSPONSOR.com; free registration required)
Promoting Phased Retirement Instead of Early Retirement
September 2001 issue. Excerpt: "Canadian employers have promoted early retirement for many years. That is now the exact opposite of what's needed.... Canadian employers are confronting a major labor challenge as the demand for skilled workers exceeds the supply." (Benefits Canada)
District Court Erred In Ruling That ERISA Preempted State Law Claims Involving ESOP
A federal district court lacked jurisdiction when it ruled that ERISA preempted state law claims of fraud and breach of contract filed by employees after an employee stock ownership plan defaulted on its indebtedness to them. This was the decision of the Ninth Circuit U.S. Court of Appeals in Abraham, et al. v. Norcal Waste Systems, Inc., et al. (Nos. 99-17040, 99-17474, and 99-17132). (Spencernet)
Don't Skimp on 401(k) Introduction That You Give to New Employees
Excerpt: "How do you tell new employees about the company's 401 (k) plan? Do you send a brochure, invite them to a meeting or just tell them about it in a welcome letter? A U.S. District Court has refused to dismiss the case of an employee who claims her employer failed to properly notify her of the existence of the employer's retirement plan." (IOMA's Report on Managing 401(k) Plans via IFEBP)
Analysis: Supreme Court Rules ERISA Preempts State Law Revoking Beneficiary Designation Upon Divorce
Excerpt: "The United States Supreme Court recently held in a 7 - 2 decision that the Employee Retirement Income Security Act of 1974, as amended ('ERISA'), pre-empts a Washington State statute which provides that, upon divorce, a designation of the former spouse as the beneficiary of a benefit plan or other non-probate asset is automatically revoked." (White & Case, L.L.P.)
ERISA's Anti-Cutback Rules Protect Certain Contingent Benefits
Excerpt: "The United States Supreme Court recently declined to review the decision of the United States Court of Appeals for the Third Circuit (the 'Third Circuit') in Bellas v. CBS, Inc.; Westinghouse Pension Plan which held that the anti-cutback rules set forth in the Employee Retirement Income Security Act of 1974, as amended ('ERISA'), applied to contingent benefits that continued beyond normal retirement age." (White & Case, L.L.P.)
Take It or Leave It: Employers Assisting Participants With Rollover Options
September 2001 issue. Excerpt: "Plan sponsors are finding that it pays to help employees plot their post-retirement strategies-including that pivotal decision: to roll over, or to leave the money in the plan." (PLANSPONSOR.com; free registration required)
Opinion: Pittsburgh Can't Afford to Enhance Its Pension Formula
Excerpt: "Technically, the legislation would abolish a practice of reducing a city retiree's pension income based on the individual's Social Security benefits. This so-called offset provision was introduced in city government in the 1970s." (The [Pittsburgh] Post-Gazette)
A Safe Way to Privatize Social Security: Look to South Texas
Excerpt: "We can privatize Social Security without creating the Mother of All 401(k) Plans. The alternative isn't an idea. It has been in use for twenty years. Its participants are happy with the results. The only reason this solution has been overlooked by the Washington policy establishment is that they don't spend much time in south Texas. More than 20 years ago Galveston County asked Rick Gornto, a financial planner, to create an alternative to Social Security." (Scott Burns of The Dallas Morning News)
What Can We Learn from the Cohort Size Literature about the Future Demand for the Greying Baby Boomers (PDF)
Excerpt: "This paper examines what we know about the effect of being in a large cohort on labor market outcomes of older workers. Specifically what does the literature on the impact of cohort size and composition tell us about the likely future impact of employer's demand for the greying baby boomers?" (Boston College, Center for Retirement Research)
Employer Surveys, Employer Policies, and Future Demand for Older Workers (PDF)
Excerpt: "Can employer surveys -- surveys that inquire into employer policies and attitudes -- provide insights into future demand for older workers? In particular, do they provide useful information on (1) the extent to which employers view older workers as substitutes for younger workers? (2) The possibility for renegotiating employment arrangements as workers age? (3) Employer willingness to employ part-time rather than full-time workers?" (Boston College, Center for Retirement Research)
Older Workers in the Coming Labor "Shortage:" Implications of Labor Demand (PDF)
Excerpt: "How will employers react to this relative reduction in the supply of labor of a group of workers that has typically been viewed as being the most productive segment of the labor force? What does evidence on substitution of capital for labor, among groups of workers, and of hours for workers indicate might happen? In particular, what will be the effects on the demand for older workers?" (Boston College, Center for Retirement Research)
The Fund of Hedge Funds
September 2001 issue. Excerpt: "Funds of hedge funds use multiple managers and strategies to mitigate risk. But that doesn't mean they don't demand careful monitoring." (Benefits Canada)
(Following items are in both editions of the BenefitsLink Newsletter)
Misinterpretation of Permissible Top Hat Group Costs Employer $13.6 Million
Excerpt: "Neither ERISA nor the regulations thereunder define the phrase 'primarily for a select group of management or highly compensated employees.' The interpretation of this phrase in the absence of substantial guidance is problematic for companies sponsoring top hat plans and, as evidenced by the holding in Carrabba v. Randalls Food Markets ... (5th Cir. 2001) which is discussed in greater detail below, being 'wrong' could cost the employer dearly (e.g., $13.6 million in Carrabba)." (White & Case, L.L.P.)
Employers Embrace Options Despite Stock-Market Slide
Excerpt: "Even though many options have no current value because they're underwater, employers aren't about to abandon stock options as a mean of compensation. That's the consensus of more than 200 human-resources and compensation executives from primarily high-tech firms who late last month attended a Silicon Valley conference sponsored by iQuantic Buck." (CareerJournal.com)
Newly Posted or Renewed Job Openings ( Post Yours! )
Newly Posted Conferences ( Post Yours! )
Copyright 2001 BenefitsLink.com, Inc., but you may freely distribute this email newsletter in whole. This newsletter is edited by David Rhett Baker, J.D.
Jobs | Today's Messages | Topical News | Q&A Columns | Services & Products | Search | Reference
The BenefitsLink Newsletter -
Retirement Plans Edition
Retirement Plans Edition
October 10, 2001 - 12,199 subscribers
Today's sponsor: ASPA
(Click on company name or banner to learn more.)
Advance your career with the retirement industry's only certification program devoted exclusively to 401(k) plans. QKA is available only from ASPA-- the education leader for qualified plan issues. You can add the prestigious QKA designation to your name by passing five invaluable courses. QKA training is essential for completing day-to-day work, and for realizing a promising future. Start earning your QKA designation today-- and watch your career soar tomorrow. Click on the banner above or visit http://www.asppa.org/qka/n03a/index.html for more information.
(Help BenefitsLink to provide this newsletter at no charge to you -- our sponsors pay our way. Remember to visit them periodically; we try to make sure their products and services will be of interest to you. Thanks! --Editor)
October 15th Deadline to Recharacterize Roth IRA Back to Traditional IRA
Excerpt: "Are your clients worried about the traditional IRA they converted to a Roth IRA back in 2000-- that may now be worth substantially less money? Perhaps reversing the conversion--placing the funds back into a traditional IRA-- is the best treatment of the funds." (National Underwriter)
IRS Begins Issuing GUST Letters for M&P Plans
Excerpt: "The Service has begun to issue opinion letters to sponsors of master and prototype (M&P) plans who applied for GUST opinion letters by December 31, 2000.... the Service will soon publish on the IRS Web-page a list of the M&P plans and volume submitter specimen plans that were timely submitted for GUST opinion and advisory letters." (Internal Revenue Service)
Can You Retire on Time Despite Market Turmoil?
Excerpt: "No stock-market seer can be certain when the market will reach a bottom. It may already be there for all anyone knows. But even the smallest mutual-fund investor has a surefire way to buy stocks close to their lowest levels. It's simple: Just stick to a plan of buying stock-fund shares in regular installments through a 401(k) retirement plan or other investment account." (CareerJournal.com)
401(k) Plans in Good Conscience: Socially Responsible Funds
September 2001 issue. Excerpt: "Participant demand and new, low-expense offerings help socially responsible funds to catch on." (PLANSPONSOR.com; free registration required)
Assessing the New Contribution Catch-Up Rules
September 2001 issue. Excerpt: "One of the better-known parts of the new tax bill is its provision for plan participants over the age of 50 to set aside additional funds for retirement-above and beyond their regular savings. While many in the press touted that group's ability to sock away an extra $5,000 per year, the reality is that it will be several years before that much can be set aside." (PLANSPONSOR.com; free registration required)
Promoting Phased Retirement Instead of Early Retirement
September 2001 issue. Excerpt: "Canadian employers have promoted early retirement for many years. That is now the exact opposite of what's needed.... Canadian employers are confronting a major labor challenge as the demand for skilled workers exceeds the supply." (Benefits Canada)
District Court Erred In Ruling That ERISA Preempted State Law Claims Involving ESOP
A federal district court lacked jurisdiction when it ruled that ERISA preempted state law claims of fraud and breach of contract filed by employees after an employee stock ownership plan defaulted on its indebtedness to them. This was the decision of the Ninth Circuit U.S. Court of Appeals in Abraham, et al. v. Norcal Waste Systems, Inc., et al. (Nos. 99-17040, 99-17474, and 99-17132). (Spencernet)
Don't Skimp on 401(k) Introduction That You Give to New Employees
Excerpt: "How do you tell new employees about the company's 401 (k) plan? Do you send a brochure, invite them to a meeting or just tell them about it in a welcome letter? A U.S. District Court has refused to dismiss the case of an employee who claims her employer failed to properly notify her of the existence of the employer's retirement plan." (IOMA's Report on Managing 401(k) Plans via IFEBP)
Analysis: Supreme Court Rules ERISA Preempts State Law Revoking Beneficiary Designation Upon Divorce
Excerpt: "The United States Supreme Court recently held in a 7 - 2 decision that the Employee Retirement Income Security Act of 1974, as amended ('ERISA'), pre-empts a Washington State statute which provides that, upon divorce, a designation of the former spouse as the beneficiary of a benefit plan or other non-probate asset is automatically revoked." (White & Case, L.L.P.)
ERISA's Anti-Cutback Rules Protect Certain Contingent Benefits
Excerpt: "The United States Supreme Court recently declined to review the decision of the United States Court of Appeals for the Third Circuit (the 'Third Circuit') in Bellas v. CBS, Inc.; Westinghouse Pension Plan which held that the anti-cutback rules set forth in the Employee Retirement Income Security Act of 1974, as amended ('ERISA'), applied to contingent benefits that continued beyond normal retirement age." (White & Case, L.L.P.)
Take It or Leave It: Employers Assisting Participants With Rollover Options
September 2001 issue. Excerpt: "Plan sponsors are finding that it pays to help employees plot their post-retirement strategies-including that pivotal decision: to roll over, or to leave the money in the plan." (PLANSPONSOR.com; free registration required)
Opinion: Pittsburgh Can't Afford to Enhance Its Pension Formula
Excerpt: "Technically, the legislation would abolish a practice of reducing a city retiree's pension income based on the individual's Social Security benefits. This so-called offset provision was introduced in city government in the 1970s." (The [Pittsburgh] Post-Gazette)
A Safe Way to Privatize Social Security: Look to South Texas
Excerpt: "We can privatize Social Security without creating the Mother of All 401(k) Plans. The alternative isn't an idea. It has been in use for twenty years. Its participants are happy with the results. The only reason this solution has been overlooked by the Washington policy establishment is that they don't spend much time in south Texas. More than 20 years ago Galveston County asked Rick Gornto, a financial planner, to create an alternative to Social Security." (Scott Burns of The Dallas Morning News)
What Can We Learn from the Cohort Size Literature about the Future Demand for the Greying Baby Boomers (PDF)
Excerpt: "This paper examines what we know about the effect of being in a large cohort on labor market outcomes of older workers. Specifically what does the literature on the impact of cohort size and composition tell us about the likely future impact of employer's demand for the greying baby boomers?" (Boston College, Center for Retirement Research)
Employer Surveys, Employer Policies, and Future Demand for Older Workers (PDF)
Excerpt: "Can employer surveys -- surveys that inquire into employer policies and attitudes -- provide insights into future demand for older workers? In particular, do they provide useful information on (1) the extent to which employers view older workers as substitutes for younger workers? (2) The possibility for renegotiating employment arrangements as workers age? (3) Employer willingness to employ part-time rather than full-time workers?" (Boston College, Center for Retirement Research)
Older Workers in the Coming Labor "Shortage:" Implications of Labor Demand (PDF)
Excerpt: "How will employers react to this relative reduction in the supply of labor of a group of workers that has typically been viewed as being the most productive segment of the labor force? What does evidence on substitution of capital for labor, among groups of workers, and of hours for workers indicate might happen? In particular, what will be the effects on the demand for older workers?" (Boston College, Center for Retirement Research)
The Fund of Hedge Funds
September 2001 issue. Excerpt: "Funds of hedge funds use multiple managers and strategies to mitigate risk. But that doesn't mean they don't demand careful monitoring." (Benefits Canada)
Misinterpretation of Permissible Top Hat Group Costs Employer $13.6 Million
Excerpt: "Neither ERISA nor the regulations thereunder define the phrase 'primarily for a select group of management or highly compensated employees.' The interpretation of this phrase in the absence of substantial guidance is problematic for companies sponsoring top hat plans and, as evidenced by the holding in Carrabba v. Randalls Food Markets ... (5th Cir. 2001) which is discussed in greater detail below, being 'wrong' could cost the employer dearly (e.g., $13.6 million in Carrabba)." (White & Case, L.L.P.)
Employers Embrace Options Despite Stock-Market Slide
Excerpt: "Even though many options have no current value because they're underwater, employers aren't about to abandon stock options as a mean of compensation. That's the consensus of more than 200 human-resources and compensation executives from primarily high-tech firms who late last month attended a Silicon Valley conference sponsored by iQuantic Buck." (CareerJournal.com)
Newly Posted or Renewed Job Openings ( Post Yours! )
for Brady, Ware & Schoenfeld, Inc.
in OH
in OH
for Thomas, Doll & Company, CPAs
in CA
in CA
for New England Financial/MetLife
in MA
in MA
for Northern Trust Retirement Consulting, L.L.C.
in GA
in GA
for Northern Trust Retirement Consulting, L.L.C.
in GA
in GA
Newly Posted Conferences ( Post Yours! )
in MI
on January 8, 2002
presented by A.E. Roberts Company
presented by A.E. Roberts Company
in NY
on January 8, 2002
presented by A.E. Roberts Company
presented by A.E. Roberts Company
in CA
on January 8, 2002
presented by A.E. Roberts Company
presented by A.E. Roberts Company
in WI
on January 8, 2002
presented by A.E. Roberts Company
presented by A.E. Roberts Company
in MD
on January 15, 2002
presented by A.E. Roberts Company
presented by A.E. Roberts Company
in OR
on January 15, 2002
presented by A.E. Roberts Company
presented by A.E. Roberts Company
in OK
on January 15, 2002
presented by A.E. Roberts Company
presented by A.E. Roberts Company
in CT
on January 15, 2002
presented by A.E. Roberts Company
presented by A.E. Roberts Company
in WI
on January 22, 2002
presented by A.E. Roberts Company
presented by A.E. Roberts Company
in MI
on January 22, 2002
presented by A.E. Roberts Company
presented by A.E. Roberts Company
in NJ
on January 22, 2002
presented by A.E. Roberts Company
presented by A.E. Roberts Company
in WA
on January 22, 2002
presented by A.E. Roberts Company
presented by A.E. Roberts Company
in NY
on January 29, 2002
presented by A.E. Roberts Company
presented by A.E. Roberts Company
in DC
on January 29, 2002
presented by A.E. Roberts Company
presented by A.E. Roberts Company
in AR
on January 29, 2002
presented by A.E. Roberts Company
presented by A.E. Roberts Company
in PA
on December 12, 2001
presented by ASPA Benefits Council of Western Pennsylvania
presented by ASPA Benefits Council of Western Pennsylvania
in MA
on October 18, 2001
presented by Invesmart
presented by Invesmart
Subscribe to the Welfare Plans Edition, too (click)
Copyright 2001 BenefitsLink.com, Inc., but you may freely distribute this email newsletter in whole. This newsletter is edited by David Rhett Baker, J.D.
- How to Sponsor an Issue : reach 12,199 benefits professionals!
- How to Subscribe
- Privacy Policy
- Archive of Prior Issues