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Category Archives: Retirement Plans

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Withdrawn Employers Don’t Have Standing: Why Employers Can’t Sue Trustees

Posted in Court Cases, Retirement Plans, Withdrawal Liability

For employers who cease to contribute to a multiemployer defined benefit pension plan, withdrawal liability is becoming more and more common.  When a pension fund is underfunded, the cessation of the contribution obligation can trigger the obligation to pay off the allocated portion of that unfunded liability which can be substantial.  When I am working … Continue Reading

Moench On This – U.S. Supreme Court’s Decision in Fifth Third Bancorp v. Dudenhoeffer for ESOP Fiduciaries

Posted in Court Cases, Plan Administration, Retirement Plans

On June 25, 2014, in a unanimous decision, the U.S. Supreme Court in Fifth Third Bancorp v. Dudenhoeffer, held that fiduciaries of employee stock ownership plans (ESOPs) are not protected by a presumption that they have acted prudently in making investment decisions—a presumption commonly referred to as the “presumption of prudence” or the “Moench presumption.” … Continue Reading

U.S. Supreme Court Rules Inherited IRAs Are Not Retirement Funds

Posted in Court Cases, Retirement Plans

Susan Jordan, a benefits and wealth planning partner with the firm, wrote this article about a recent Supreme Court decision.  It is significant to consider when coordinating retirement planning and potentially impacts retirement plan administration.  For more information, please contact her directly. On June 12, 2014, the United States Supreme Court ruled that funds held … Continue Reading

A Surcharge is Not a Contribution (or at least not for Withdrawal Liability)

Posted in Court Cases, Retirement Plans

When calculating withdrawal liability payments, a multiemployer pension fund uses the “highest contribution rate” that the employer was obligated to contribute to the pension fund prior to the withdrawal.  Thanks to the Pension Protection Act, funds that are in critical status can impose a surcharge (up to 10%) and, in recent years, most funds included … Continue Reading

New Post-Windsor Guidance on Same-Sex Marriage

Posted in Court Cases, Plan Administration, Retirement Plans, Welfare Plans

Susan Jordan, one of my partners in Pittsburgh, provides the following guidance with respect to the IRS’ recent guidance on treatment of same-sex marriage: In its decision in United States v. Windsor, handed down on June 26, 2013, the United States Supreme Court declared Section 3 of the Defense of Marriage Act to be unconstitutional. … Continue Reading

Disclaimers Can Be A Good Thing, Particularly in Benefit Notices

Posted in Court Cases, Plan Administration, Retirement Plans

With the requirement that retirement plan administrators provide statements to retirees of account balances and benefit levels on a regular basis, the concept of including a disclaimer on the notices can be overlooked.  Most administrators and reluctant to state that the benefits may be subject to change in the future.  Particularly in the defined benefit … Continue Reading

Don’t Get Cute When Documents Are Requested: ERISA Penalty Provisions for “Hiding” Plan Documents

Posted in Court Cases, Plan Administration, Retirement Plans, Welfare Plans

ERISA generally requires that plan participants get copies of summary plan descriptions, plan documents and annual reports when requested. ERISA Section 104(b)(4) provides that “the administrator shall, upon written request of any participant or beneficiary, furnish a copy of the latest updated summary, plan description, and the latest annual report, any terminal report, the bargaining … Continue Reading

April is a Busy Month: IRS Releases Guidance on Same Sex Marriage and Retirement Plan Rollovers

Posted in Plan Administration, Retirement Plans

We are less than halfway into April and already the IRS has issued two notices that provide some long awaited guidance related to retirement plan administration.  One addresses treatment of same-sex marriages post-Windsor and the other deals with rollovers by qualified retirement plans. Notice 2014-19 clears up some of the issues related to the timing … Continue Reading

DOL Hopes Proposed Amendment to Fee Disclosure Rules Will be Useful Roadmap in Difficult Terrain

Posted in Plan Administration, Retirement Plans

Perhaps after reading too many voluminous, jargon-filled fee disclosure agreements, the Department of Labor (“DOL”) became fed up and decided to take action. Last week, the DOL issued a proposed rule (“the Proposed Rule”) that would amend its final service provider fee disclosure regulation (“the Final Rule”) under ERISA Section 408(b)(2). The Proposed Rule will require … Continue Reading

Are You Doing What Your Plan Says You Are Doing? Consistent Plan Administration

Posted in Plan Administration, Retirement Plans, Welfare Plans

Recently a client brought me in to review a defined contribution plan document given to them by a service provider to create their new plan.  In the document, it makes reference to regular investment committee meetings, a benefit committee and an appeals committee.  When I asked my client about who would serve on those committees, … Continue Reading

Funding Status Does Not Preclude Withdrawal: Remember Honerkamp

Posted in Court Cases, Plan Administration, Retirement Plans

More and more employers are looking to withdraw from multiemployer pension funds.  Employers cannot unilaterally withdraw from the fund as the obligation to contribute is established through collective bargaining with the union.  Lately, several employers have contacted me about representations from the union (or the fund) that claim that employers cannot legally withdraw from the … Continue Reading

What the EBSA Will Ask For In A 401(k) Plan Audit: Documentation You Need

Posted in Plan Administration, Retirement Plans

When clients get an audit request letter from the EBSA, they usually call me surprised at the amount of information being requested.  It is not just the shock of being audited that impacts them, but the amount of information they need to provide.  Sometimes, the requested documentation may not be available, which creates its own … Continue Reading

Be Careful About Appeals: Deny them Completely the First Time

Posted in Court Cases, Plan Administration, Retirement Plans, Welfare Plans

Appeals for denial of benefits can create a real quagmire for plan administrators.  The appeal process creates an administrative record, and sometimes the administrative record is not complete.  It is important for plan administrators to consider each appeal completely, and address all issues related to claims processing, even ones not necessarily raised by the participant, … Continue Reading

Fiduciaries Can Sometimes Rely on Legal Advice (or Why ERISA Counsel is a Good Thing to Have)

Posted in Court Cases, Plan Administration, Retirement Plans, Welfare Plans

One of the hallmarks of the fiduciary obligation is to make decisions on an informed basis and to be reasonably diligent when making decisions related to the plan and its administration.  Fiduciaries can reasonably relay on experts, like plan counsel, when making decisions related to plan administration.  In Clark v. Feder Semo and Bard, P.C., … Continue Reading

No Windfalls Under ERISA: Court Approves $725,000 Pension Plan Reimbursement Claim

Posted in Court Cases, Plan Administration, Retirement Plans

Often time it happens that a pension plan participant is paid more from a pension plan than they should be getting.  Sometimes this administrative error can be as a result of mistakes regarding hire dates, termination dates or years of service.  Sometimes they can be a result of mistakes over reported wages to the plan … Continue Reading

The Plan Says What it Says: Plan Statute of Limitations Applies

Posted in Court Cases, Plan Administration, Retirement Plans, Welfare Plans

For the purposes of figuring out when a claim has to be brought, plans can, in some instances, dictate when the “statute of limitations” runs for bringing a lawsuit.  Part of this is for consistent administration and part of it may be to avoid untimely litigation.  This was the issue in the Supreme Court’s recent decision … Continue Reading

Electronic Disclosures: It is Not as Simple as Sending an E-mail

Posted in Plan Administration, Retirement Plans, Welfare Plans

In light of all the PPACA disclosure requirements, and with the year-distributions required for retirement plans, employers tend to want to distribute benefit plan notices electronically.  Maybe companies want to post them on a company website or e-mail them to employees, but there is no question that mailing paper notices to employees is the least … Continue Reading

IRS Issues Threshold Limits: Important Numbers for 2014

Posted in Plan Administration, Retirement Plans, Welfare Plans

It’s that time of year again.  The IRS has released its annual deferral and threshold limits for 2014 for various benefit plans and plan administrators (as well as HR professionals) should be aware of these changes.  Below is a list of the most commonly used limits in benefits plans for 2014: Maximum employee elective deferral: … Continue Reading

DOL Agrees with IRS Definition of Spouse: The “Celebration” Rule

Posted in Plan Administration, Retirement Plans, Welfare Plans

At the end of August, I wrote about the IRS’s statement that it will make a determination on same-sex couples based on where the marriage took place for income tax purposes.  Well, the DOL has now also adopted this “place of celebration” rule as its interpretation of “spouse.”   This means that for most benefit plans, the term spouse … Continue Reading

Withdrawal Liability Can Be Discharged in Bankruptcy: Good Thing to Know

Posted in Court Cases, Retirement Plans

Personal liability for company owners in a withdrawal liability scenario can be a scary thing.  Some recent federal decisions have held that, where an employer owes delinquent contributions, a business owner or manager who elects to pay other bills and not the fund can be held personally liable as a “fiduciary” provided the fund documents … Continue Reading