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Today's sponsor is ASC & The ASC Institute

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[Guidance Overview] IRS's Deadline for Transfers from Dual-Qualified to Puerto Rico-Only Qualified Plans
Excerpt: "As a result of a recent U.S. Internal Revenue Service (IRS) Revenue Ruling (Rev. Rul. 2008-40), employers that maintain plans intended to be qualified both in the United States and in Puerto Rico (dual-qualified plans) should consider whether to continue to maintain these plans as dual-qualified in the future or split them up between separate U.S.-only and Puerto Rico-only qualified plans." (McDermott Will & Emery)


[Guidance Overview] DOL's Proposed Regulations on Participant Fee Disclosures (PDF)
Excerpt: "The proposed regulations apply to all participant-directed 401(k) and other defined contribution plans regardless of whether they are so-called '404(c)' plans. Plan sponsors that voluntarily seek to comply with ERISA ? 404(c) requirements to obtain available fiduciary protections already must disclose investment and fee information to participants. However, the DOL noted that many participant-directed plans are not '404(c)' plans, yet these participants still need adequate information to make informed investment allocations." (Kelly, Hannaford & Battles P.A.)


Two Public Pension Funds' Virtuous Mistake: CalPERS and CalSTRS Do-Good Investment Strategy Has Cost California Retirees Billions
Excerpt: "Eight years ago, then-state treasurer Philip Angelides launched his 'Double Bottom Line' initiative, espousing a philosophy of profits and social reform. As part of the plan, the $239 billion California Public Employees' Retirement System (CalPERS) dropped investments in countries that lacked a free press, labor unions, and other hallmarks of democracy. CalPERS and the $162 billion California State Teachers' Retirement System (CalSTRS) also dumped tobacco stocks and plowed money into businesses and real estate that would benefit the local economy." (BusinessWeek)


Columbus, Ohio, Taxpayers Footing Most or All of Public Employees' Share of Pensions
Excerpt: "If you work for the state of Ohio, Columbus schools or Ohio State University, 10 percent of your income goes toward your future public-employee pension. If you work for the city of Columbus, though, it's likely you're getting a free ride into your golden years. And if you're a city resident or taxpayer, you're picking up the tab." (The Columbus Dispatch)


New York State Comptroller Has an Idea for Increasing Growth in New York's Pension Fund
Excerpt: "To cope with a growing number of retiring baby boomers and a shrinking state pension fund, the state comptroller said on Monday that he would ask the Legislature to permit a larger share of state pension assets to be placed in less-traditional investments." (The New York Times; free registration required)


A Guide to Starting Social Security Benefits
Excerpt: "When a person should begin taking Social Security retirement benefits is a critical question for planning one's retirement. This article explains the various factors at play in determining the optimum starting point, including: longevity considerations; spousal implications, whether for a previously employed or a previously unemployed spouse; the impact of post-retirement employment; the availability of health insurance prior to Medicare eligibility for the worker and the worker's spouse; alternative sources of retirement income, including distributions from retirement savings plan assets and lifetime liquidation of nonretirement assets (and the pertinent income tax ramifications); and anticipated investment strategies." (Social Science Research Network)


In United Kingdom, Changes to Automatic Enrollment Expected
Excerpt: "The Pensions Bill will require employers, beginning in 2012, to automatically enroll employees between ages 22 and the state pensionable age into a 'qualifying' retirement scheme. The latest round of parliamentary debates on the bill has revealed further details about this new obligation." (Watson Wyatt Worldwide)


PBGC's Disaster Relief for Indiana, Wisconsin, West Virginia, Nebraska, Illinois, and Missouri
Excerpt: "The Pension Benefit Guaranty Corporation (PBGC) has announced relief from certain deadlines and penalties in connection with the Form 5500 series for 'designated persons' in certain areas declared disaster areas due to severe weather conditions." (Wolters Kluwer)


Fee Disclosure Timetable Is Met with Some Skepticism
Excerpt: "The Department of Labor's announcement that it is planning to implement new fee-disclosure regulations for participant-directed defined contribution plans beginning on or after Jan. 1, 2009, was met with skepticism by pension industry consultants and lobbyists -- even though the proposed rule itself generally received favorable reviews." (Pensions & Investments)


Video: Death of the Pension Plan
Alexis Glick interviews Bradley Belt and John Bury. (Fox News Network)


FAS 132: for Reporting on the Quality of Pension Assets and Certain Other Things
Excerpt: "As proposed, the FAS 132 [FASB staff position] would, basically, apply the FAS 157 requirements to companies reporting on DB plans. It would require that sponsors provide information about what kinds of assets are held in the DB plan -- stocks, hedge funds, real estate, etc. Critically, the company would have to provide information about the riskiness of the DB plan's portfolio." (PLANSPONSOR.com; free registration required)


Employees Paying All or Almost All the Costs of Operating Their 401(k) Plans
Excerpt: "[M]ost or all of the plan costs are paid -- either directly or indirectly -- from the mutual funds. (I say 'indirectly' because, in some cases, part of the money may come from the mutual fund's investment adviser's fee, as opposed to being a separate charge against the mutual fund's assets.) Since it is paid from the mutual funds, in one way or another, it reduces the value of the investments of the participating employees." (PLANSPONSOR.com; free registration required)


New Data on State Defined Contribution and Defined Benefit Plans
Excerpt: "[The Center] has made available two new sets of 2006 state pension data collected by the Center for Retirement Research at Boston College: For the first time, detailed defined contribution data are available for the 20 primary plans operated by state governments. Defined benefit data are available for 126 plans largely administered by the state." (Center for State and Local Government Excellence)


Video: Defined Contribution Retirement Plans Around the World
Excerpt: "Leaders from Mercer's retirement and investment consulting businesses that specialize in defined contribution plans gathered from around the world in New York in March of this year. To take advantage of having our global DC consulting leaders together, Mercer produced a three-part video series in a panel format . . . . [Each segment runs 15 minutes.]" (Mercer LLC)


The Active-Passive Debate: Market Cyclicality and Leadership Volatility
Excerpt: "In this paper, we examine the active-versus-index debate from the perspective of market cyclicality, and provide context for the changing nature of performance leadership. We show that when evaluating the performance of active managers versus a given benchmark, investors should be acutely aware of the differences in the managers' strategies involving factors such as size (market capitalization), style (price/earnings ratio and price/book ratio), and relative positioning." (The Vanguard Group)


Small Businesses Can Set Up Both Entrepreneur Rollover Stock Ownership Plan and Conventional 401(k) Plan
Excerpt: "['ERSOP'] is a marketing term rather than a federally recognized stock ownership plan. 'This is a plan primarily promoted by one consulting group. It should not be confused with an ESOP (Employee Stock Ownership Plan), which is sanctioned by federal law,' says Corey Rosen, executive director of the National Center for Employee Ownership in Oakland, Calif." (BusinessWeek)


Boomers Running Out of Time to Save, According to Advisors
Excerpt: "Retirement planning was a top priority for 42% of 1,305 independent advisers polled by Curian Capital LLC, and a full 90% said they felt that a sizeable portion of their clients -- nearly 80% -- would not have adequate funds during retirement to meet their expected standard of living." (Investment News; free registration required)


Employee Class Action Suit Against Home Depot Revived
Excerpt: "A class action lawsuit filed by Home Depot employees against former company CEO Robert Nardelli and several directors has a new lease on life. The case has been revived by a federal appellate court decision that gives a life line to the retirees while being pro-business, said two lawyers who studied the case. The lawsuit, possibly worth tens of millions of dollars to current and future retirees, alleges that Nardelli, and other directors . . ., mismanaged the employees' defined contribution plan by purchasing Home Depot stock even though the executives backdated stock options." (The Atlanta Journal-Constitution)


[Opinion] Rebuttal to Misleading Article in August 4, 2008, Wall Street Journal
Excerpt: "[I] feel bound to correct some of the distortions in the article on the front page of [the August 4, 2008 of] The Wall Street Journal ('Companies Tap Pension Plans To Fund Executive Benefits'). This plan design is far from 'a dubious use of the tax laws.' It is perfectly legal and not even close to the line. I first blogged on this plan design alternative a couple years ago -- when we referred to it as the 'QSERP' (to be clear, I cannot take credit for creating it)." (Michael S. Melbinger via Winston & Strawn LLP)


[Opinion] Don't Blame Pension Terminations on Our Bankrup.tcy System
Excerpt: "Many in the media tend to blame large pension terminations on our bankrup.tcy system. It's not uncommon to see articles claiming that companies use the bankrup.tcy court to eliminate their obligation to pay benefits for the lifetime of their former employees. What you never read about is anyone recognizing that a promise of 'lifetime benefits' is good for the lifetime of the employee or the company ? whichever ends first." (American Bankrup.tcy Institute)


[Opinion] Actuaries Advocate Raising Social Security's Retirement Age (PDF)
2 pages. Excerpt: "Over the years, actuaries have evaluated numerous proposals to prevent [the program from being unable to pay timely benefits in full] from happening. Among the very many options that would alleviate the imbalance, one rises to the top of our list: raising Social Security's retirement age. As life expectancy increases, the percentage of workers' lives spent in retirement continues to grow, while the number of working years stays relatively constant. Inevitably, Social Security's costs will exceed what its scheduled financing will support. This is primarily a demographic problem that demands a demographic solution." (American Academy of Actuaries)

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Sponsored by: SunGard's RELIUS Education

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Links to Items on Executive Comp, Benefits in General

[Opinion] Beware of Beneficiary Provisions in Equity Plans
Excerpt: "This article was recently posted on CorporateCounsel.net and on the NASPP website. In this posting, Ed Burmeister speaks candidly about equity plans and beneficiary provisions." (Baker & McKenzie LLP)

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Newly Posted Events

23rd Annual National Institute on Compensation for Executives and Directors
in New York on November 10, 2008
presented by ABA Joint Committee on Employee Benefits

Reducing Health Care Costs Without Crossing The Legal Line: Wellness Programs & Other Cost Cutting Strategies Webcast
Nationwide on August 13, 2008
presented by Alexander Hamilton Institute

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Newly Posted Press Releases

HRandBenefits.com Wins 2008 APEX Award
BenefitsEssentials.com

USAA Launches New Target Retirement Funds
USAA

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Newly Posted or Renewed Job Openings
( Post a Job | View All Jobs | RSS Feed )

Defined Benefit Pension Administration Team Leader
for Milliman, Inc.
in NJ

Assistant General Counsel
for American International Group, Inc.
in NY

Retirement Plan Benefits Professional
for Huntington National Bank
in IN, OH, PA

Pension Administrator
for Retirement Alliance
in NH

Sr Compliance, Testing and Design Specialist
for Retirement Alliance
in NH

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Handy Links:

• View Today's Active Message Threads
• Using the Web for Employee Benefits Research (hypertext article)
• Employee Benefits Library

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