Bloomberg BNA's Pension & Benefits Blog is a special resource offered by Bloomberg BNA to provide commentary and insight on news and trends reported in our publications: Pension & Benefits Daily, Pension & Benefits Reporter, and the Benefits Practice Resource Center. The authors of the blog are members of our Benefits Practice Resource Advisory Board and members of staff (who contribute summaries of some of their recent stories).
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April 16, 2014
by Sean Forbes
about the retroactive application of Windsor to claims for benefits
under the Employee Retirement Income Security Act?
April 9, 2014
Many plan sponsors and
administrators got the news they were looking for on the application of the
U.S. Supreme Court's Windsor decision to retirement plans: No
retroactive application before the date of the high court ruling itself.
April 4, 2014
by Jacklyn Wille
litigation, questions of constitutional standing and the fate of the
pro-fiduciary presumption of prudence are the big issues currently driving fiduciary
litigation under the Employee Retirement Income Security Act, practitioners
said during a webcast.
by Andrew L. Oringer
So we've now had the oral argument before the Supreme Court in the potentially critical
Dudenhoeffer case (Fifth Third Bancorp v. Dudenhoeffer, U.S., No. 12-751, argued 4/2/14).
April 2, 2014
question of whether a judge-made presumption of prudence should protect
fiduciaries of employer stock plans from liability for declining stock prices
will be front and center at the U.S. Supreme Court next week, with the court
receiving nine amicus briefs in the months leading up to oral arguments.
March 27, 2014
by Sue Doyle
Throughout his first four years in
office, Illinois Gov. Pat Quinn (D) gave a consistent stump speech--a pledge to
overhaul the worst-funded public sector retirement system in the country.
March 19, 2014
Phyllis C. Borzi, assistant
secretary for the Department of Labor's Employee Benefits Security
Administration, doesn't have 21 questions for people who doubt whether the
agency's expected re-proposed fiduciary regulations are necessary. She has only
March 12, 2014
by David B. Brandolph
Pension plan trustees can
offer participants much-needed individual investment advice in their
participant-directed accounts without undue fear of liability, speakers said
during a conference.
March 7, 2014
by Marvin Anderson
President Barack Obama's
proposed $3.9 trillion fiscal year 2015 budget includes requirements that
employers offer individual retirement accounts and provisions that would reduce
tax benefits on certain retirement accounts for high-income earners.
February 12, 2014
The civil enforcement
efforts of the Department of Labor's Employee Benefits Security Administration
achieved nearly $1.7 billion in monetary results during the 2013 fiscal year,
Phyllis C. Borzi, assistant secretary of labor for EBSA, told conference
attendees at a Feb. 7 presentation.
February 5, 2014
by Joe Lustig
Plan sponsors' use of
lump-sum payments to settle pension obligations for retirees in pay status has
emerged as the leading issue in the debate over pension de-risking, an employee
benefits attorney said during a recent conference session.
January 30, 2014
The recent upswing in
defined benefit plan funding levels might encourage plan sponsors to take some
major steps to de-risk their plans.
January 23, 2014
Several U.S. Supreme Court rulings
broke new ground for employee benefits in 2013, and decisions in 2014 are also
expected to push these issues into new territory. In addition to its landmark
ruling recognizing same-sex marriage under federal law, the U.S. Supreme Court
also issued two significant opinions under the Employee Retirement Income
Security Act in 2013—one involving contractual limitations periods, and the
other involving Section 502(a)(3)'s equitable remedies provision.
January 15, 2014
A recently filed class
action complaint alleges that Fidelity Investments committed fiduciary breach
and engaged in prohibited transactions with respect to its own profit sharing
plan by failing to “recapture” certain revenue-sharing payments made by the
plan's mutual fund adviser to the plan's record keeper, both of which are
Fidelity entities (Yeaw v. FMR LLC, D. Mass., No. 1:14-cv-10035, complaint
January 10, 2014
attorney challenging the amount of benefits she received from her former law
firm's underfunded cash balance plan failed to convince the U.S. Court of
Appeals for the D.C. Circuit that a district court erred in rejecting her
claims of fiduciary breach and violations of the tax code (Clark v. Feder
Semo & Bard, P.C., D.C. Cir.,
No. 12-7092, 1/7/14).
January 7, 2014
Xerox Corp.'s use of a
phantom account in calculating and offsetting its employees' pension benefits
was unreasonable under the terms of the plan and violated the notice
requirements of the Employee Retirement Income Security Act, the U.S. Court of
Appeals for the Second Circuit ruled (Frommert v. Conkright, 2d Cir.,
No. 12-67-cv, 12/23/13).
December 13, 2013
by Kristen Ricaurte Knebel
plan community can expect guidance imminently on issues related to frozen
defined benefit plans, a Treasury Department official said during a webcast.
December 4, 2013
Department of Labor's Employee Benefits Security Administration projected that
its rule on the redefinition of the term “fiduciary,” also known as its
conflict-of-interest rule, will be re-proposed in August 2014, and also
indicated its intentions to start on a project related to brokerage windows,
according to the DOL's fall 2013 regulatory agenda.
December 2, 2013
Supreme Court should strike down the pro-fiduciary presumption of prudence that
some federal courts have used to shield fiduciaries of employer stock plans
from liability for declining share value, the U.S. solicitor general said in a
brief filed with the high court.
November 8, 2013
by Mary Hughes
The Internal Revenue
Service and Treasury Department expect to get guidance out to cafeteria plans
“very, very soon” on the retroactive application of the Supreme Court's Windsor
decision, a Treasury official said.
October 30, 2013
of Labor guidance providing that the terms “spouse” and “marriage” under the
Employee Retirement Income Security Act now include same-sex legally married
couples was a confirmation of earlier Internal Revenue Service guidance, but
some issues remain on the health and welfare plan side that could lead to legal
action down the line, practitioners told Bloomberg BNA in a series of
October 16, 2013
considering the date on which a disability plan's contractual limitations
period begins to run, the U.S. Supreme Court justices questioned attorneys on a
wide range of issues, including federal law preemption, equitable doctrines,
potential harm and the purpose of the Employee Retirement Income Security Act's
administrative exhaustion requirement.
October 11, 2013
The Department of Labor is looking into fiduciary training as
part of the agency's investigations into retirement plans, attorneys at Trucker
Huss in San Francisco told Bloomberg BNA.The attorneys had taken part in a recent webinar on the
basics of retirement plan committees, and later Bloomberg BNA asked them to
share some of their real-life experiences relating to fiduciary training under
the Employee Retirement Income Security Act.
October 1, 2013
by Andrea L. Ben-Yosef
Podcast (stream or download) by Steven Friedman and Ilyse Schuman: On Oct. 1, the Affordable Care Act marketplaces open for business. Then, starting in 2015, employers have a choice of whether to “pay or play,”-- to provide health care coverage or pay a penalty.
September 25, 2013
The Department of Labor's ERISA Advisory Council intends to recommend
that the department update current guidance related to locating lost or missing
retirement plan participants, based on teleconference discussions held by the
panel Sept. 23.
September 18, 2013
DOL's fiduciary rule re-proposal may be out as late as
spring 2014; Section 408(b)(2) summary/road map proposed rules should be out in
late September, or early October.
February 24, 2012
by Greta E. Cowart
SEC Chairman Mary Schapiro recently announced that the SEC is looking to curb high-frequency trading in stocks, a practice commonly referred to as day trading. The SEC previously attempted to address market timing or rapid trading in mutual funds when it issued amendments to rule 22c-2 in 2006. Rule 22c-2 permitted mutual funds to impose redemption fees for rapid trading or to stop rapid trades. While this rule has been in place for some time, plans may want to consider verifying how the record keepers for their plans and the mutual funds in their participant directed investment account plan are monitoring and complying with the restrictions imposed by the mutual funds and what redemption fees the mutual funds might impose for a violation not stopped by the record keeper or custodian of the funds.
August 16, 2011
by Rebecca J. Miller
The DOL’s recent proposed class exemption for the provision of investment advice has re-ignited the debate over the need for and the role of investment advice in participant directed plans. The proposal would strike a good balance between the need to offer investment advice to plan participants and the importance of participant safeguards.
June 27, 2011
Is CIGNA v. Amara (50 EBC 2569), the recent ERISA case from the U.S. Supreme Court, a major development? Notwithstanding the lack of surprise in the final result, the Court's rationale looks to be extremely important.
April 20, 2011
by Scott J. Macey
The contraction of defined benefit plans over the last 20 or so years has been dramatic and disappointing for those of us who believe that such plans are the best vehicle for providing retirement security. Some of the decline can be based on changes to the economy, the emergence of new companies and the decline of others, global competition, funding and financial reporting volatility, and other macro and micro economic factors.
April 14, 2011
The U.S. Seventh Circuit Court of Appeals issued its opinion in George v. Kraft Foods Global Inc. earlier this week impacting fiduciaries to defined contribution retirement plans such as 401(k) plans and other defined contribution plans (see 70 PBD, 4/12/11).
February 3, 2011
Professionals and small business owners are often confronted with sales pitches on how they can put away large sums for retirement, get around the nondiscrimination rules and usually get a current deduction for amounts expended.
January 20, 2011
On June 25, 2010, after more than a year of delay due largely to the legislative gridlock so enjoyed by the last Congress, legislation popularly referred to as the Pension Relief Act of 2010 (HR 3962) was signed into law.
January 13, 2011
by David M. Certner
Many investors lack financial literacy. Others simply do not have (or want) to take the time to manage their accounts. One answer -- target date funds (TDF). Pick your retirement date, and forget it. Someone else will manage the plan for you.
October 18, 2010
The existence of a fiduciary duty to disclose information pertinent to plan investments, including employer stock, is again in the news. But the lead has been buried in a regulation that focuses attention on information about fees charged by typical 401(k) plan pooled investments.
October 2, 2010
With all the cases and articles swirling around the question of when there is a fiduciary duty to stop acquiring or to dispose of employer securities, and the recent oral arguments on the point before the Second Circuit, I'd like to set out a possible analytical framework, as follows:
October 1, 2010
If you stand back from the intricate legal and economic details of this year’s events and try to grasp what’s really happening to retirement security over the long run, it’s frightening.
May 25, 2010
The Supreme Court's decision in Hardt v. Reliance Standard should have been a reason to celebrate for participants and their lawyers (99 PBD, 5/25/10). The simple holding, that you don't have to be a prevailing party before a court can exercise its discretion to grant attorney's fees is unexceptionable. Their were no dissents. But the court seemed to be at pains to tie the decision to its facts. The participant was granted benefits by the plan on the remand. Did that matter?
May 5, 2010
Heart of my Hardt. I love that mel-o-dy.
April 26, 2010
"People make mistakes." Hand it to the Chief Justice, he's got an ear for a catch phrase. As BNA summarized the holding: "Employee Retirement Income Security Act plan administrators will not be stripped of deferential review by federal courts when they make a "single honest mistake" in administering and interpreting plans...." ( Conkright v. Frommert, U.S., No. 08-810, 4/21/10).
April 8, 2010
Since many ERISA plans are in the process of preparing their audited financials for the 2009 Form 5500, this is a good time to to reflect on the nature and responsibilities that the plan administrator has in connection with the audit process. (As chair of the Audit Subcommittee for the committee that is the plan sponsor and plan administrator of the Goodyear Retiree VEBA, I had to think through these issues for our plan.)
April 2, 2010
by Norman P. Stein
Congress has been considering extending funding relief to sponsors of defined benefit plans.There has been controversy about the conditions under which a sponsor will be eligible for relief.
March 1, 2010
Today's decision on the merits by the 9th Circuit in the Golden Gate Restaurant Association v. San Francisco case upholding the employer spending requirements of the San Francisco ordinance as not preempted by ERISA is a most interesting read.
December 1, 2009
by Karen W. Ferguson
In late October, the Government Accountability Office released a report on auto-pilot retirement practices and proposals. The report reviews data on 401(k) plans that have adopted automatic enrollment, and discusses the Obama administration’s budget proposal to mandate payroll deduction IRAs for firms with ten or more employees that lack other plan coverage.
November 20, 2009
The DOL has withdrawn its investment-advice regulation, culminating a process that began with a firestorm of objection regarding the DOL's attempt to implement the PPA's new investment-advice exemptions. The PPA's exemptions were controversial when passed, and became more controversial when the Department interpreted certain fee-leveling requirements in a manner that was perceived to be narrow.
November 16, 2009
September 22, 2009
by Robert J. Bach
One of the purposes of ERISA was to provide participants with access to information so they could understand their rights and obtain their benefits from their plans.
July 6, 2009
In 1973, just before ERISA, we worried about individual workers losing their defined benefits because of insufficient funding, no plan termination guarantees, and little or no vesting. Most of us did not worry about the whole system falling apart. There were just too many disappointed expectations under the previous system.
June 2, 2009
It is not being controversial to say that there is a trend in the states in favor of permitting same-sex marriage. Previously, a broad array of employers had begun provide benefits for their employees' domestic partners. See generally Libert, Oringer & Raskin, "Same-Sex Marriage and Employee Benefits: The Approaching Revolution," 63 Empl. Ben. Plan Rev. 22.
January 29, 2009
On January 16, 2009, the Department of Labor announced that it had finalized its work under Sections 408(b)(14) and 408(g) of ERISA, which set forth the PPA's new investment-advice exemptions.
December 12, 2008
The insolvency (whether or not in Chapter 11 reorganization) of the three automakers brings “legacy costs” back to the center stage of ERISA cutback negotiation and litigation.
October 28, 2008
The election is now only days away and will occur within the context of a financial markets meltdown. The effect on retirement security has been significant. Public policy considerations must be addressed asap.
October 2, 2008
September 8, 2008
While December is when most of us look back on the year coming to end and make plans and resolutions for the year about to begin, September is another one of those times for me. After all, it’s an important month in its own right—the start of the academic year (even if classes now begin in August), the official beginning of the race in election years like this one, the unofficial end of summer with Labor Day and lest we forget, the anniversary of ERISA’s passage.
September 2, 2008
A front page article in the August 4th edition of the Wall Street Journal outlines a method by which companies are transferring portions of their non-qualified deferred compensation obligations of senior executives into their qualified plans.
August 15, 2008
Section 404(a)(1) of ERISA generally requires a fiduciary to act in the interest of participants and beneficiaries and to act prudently. ERISA also requires, under Section 103(b)(3)(A), an annual report which includes a financial statement containing, among other things, a statement of assets and liabilities "valued at their current value." Current value is to be determined in good faith by a trustee or named fiduciary.
September 18, 2006
On the ABA Joint Committee on Employee Benefits teleconference last Thursday, Bill Bortz from Treasury cleared up some issues that have been creating uncertainty under the newly-enacted Pension Protection Act of 2006.
A Possible Alternative to the Moench-ies (Part II)
Attorneys Make Predictions on Fee Litigation, Questions of Constitutional Standing
Battle Over Presumption of Prudence Heats Up Ahead of High Court Arguments
IRS Windsor Retroactivity Guidance Leaves Questions on ERISA Claims, Practitioners Say
Retirement Plans Aren't Required to Apply Windsor Ruling Retroactively, IRS Says