Month: June 2003

This article has been published by Seyfarth, Shaw: “IRS Correction Program Updated and Expanded.”

CCH.com has this article: “Bush Administration may be reviving retirement savings proposals.” Many have been saying that the Retirement Savings Proposals which were contained in the budget released on February 3, 2003 would never be enacted due to all that is going on right now in Congress. However, the article references a speech made at the Retirement Savings Conference, sponsored by the Investment Company Institute and the Securities Industry Association in Washington DC on June 2, 2003 by Assistant Treasury Secretary Pamela Olson in which she discussed the President’s proposals. You can access the speech here. (via Benefitslink.com)

This article by David M. Katz at CFO.com: “Needed: $36 Billion in Pension Contribution; Pension plans of S&P 500 vastly underfunded; same story for federal agency that backstops pension plans.” The article cites a report by FTI Consulting which examined GAAP pension data and disclosures for fiscal 2002, and found that 19 of the S&P 500 companies’ pension funding requirements will “top 30 percent of their most recent fiscal year’s free-cash flow.”

AccountingWeb.com has this article by Dixon Odom: “Timeliness of Remitting Employee Contributions to Retirement Plans.” The article discusses how the Employee Benefits Security Administration (formerly the Pension and Welfare Benefits Administration) a division of the Department of Labor (DOL) is emphasizing its position regarding the timeliness of remittances of participant contributions to employee retirement plans. The article reports that the 2002 Form 5500 (Annual Retirement/Report of Employee Benefit Plan) has a revision to question 4a of Schedule H (large plan filers) and Schedule I (small plan filers) which highlights EBSA’s position. The 2001 Form 5500 asked whether the employer had remitted participant contributions within the maximum time period allowed (i.e. the fifteenth business day). The 2002 Form 5500 asks: Did the employer fail to transmit to the plan any participant contributions within the time described in 29 CFR 2510.3-102? These reg.’s require an employer to segregate employee contributions, including plan loan repayments, from its general assets “as of the earliest date on which such contributions can reasonably be segregated from the employer’s general assets.” The article reports that employers can correct violations of this rule under the DFVC program.

The Small Business Health Fairness Act (H.R. 660) was approved today by a vote of 26 to 21 by the House Education and Workforce Committee. The bill would allow small businesses to band together through associations to purchase health care for their employees. President Bush and the U.S. Department of Labor support the legislation, as well as groups such as the U.S. Chamber of Commerce and the National Federation of Independent Business (NFIB). This article by Thompson Publishing Group reports on the bill: “AHP Bill Clears House Committee.”

This news release by the Department of Labor on the subject was just issued: “Labor Secretary Elaine L. Chao Applauds Passage of Association Health Plans Legislation.”

This article by Matt Marshall for the MercuryNews.com: “Top VC at odds with valley on options.” The article reports that Vinod Khosla, a very prominent and successful venture capitalist, has broken ranks with the rest of Silicon Valley and come out in favor of stock option expensing. He argues that requiring companies to expense stock options would “level the playing field for young private start-ups that he says are so important to the nation’s economy.”

Bloomberg.com reports here: “Intel, Dell May Award Fewer Options, More Cash to Pay Workers.”

And “The battle heats up over stock options” reports Paul Taylor for FT.com. The article points out the tension between FASB’s accounting proposals which would make stock options less appealing to employers and the tax advantages of stock options brought about by JAGTRRA.

Today’s Federal Register is here.

Read this article by James Dawn for the Toronto Star at TheStar.com for a pleasant surprise: “Fairy godmother bails out staff.” The story details how TransCanada PipeLines Ltd. of Calgary is dumping its defined contribution plan (“DC plan”) and reinstating employees in its defined benefit plan, at a cost of nearly $92,000 per employee. The article reports that the company is abandoning its DC plan due to poor perfomance by employees’ investments and also because it felt that the defined contribution plan contributed to a “culture of transience” and a “lack of loyalty.” The article reports that the company’s intent in taking this giant step is to “tie its highly skilled employees to their jobs and remove any distractions or concerns related to retirement income.”

“Fear of losing insurance keeps workers from moving on”: this article at SFGate.com on how health insurance coverage is affecting worker mobility.

The Washington Times has this article by Stephen Dinan: “House GOP seeks $82 billion tax cut.” The article reports that House Republicans will try to pass a $82 billion tax-cut bill today, “sending back to the Senate a much broader tax cut than the $10 billion bill senators passed last week.” The bill extends the $1,000 per child tax credit through 2010, eliminates the eligibility disparity between married couples and individuals in qualifying income for the child credit, and includes several smaller tax cuts for military families.

This article from the ABA Journal–“Court Surprises with Family Leave Act Ruling: Rehnquist Opinion Marks Exception in Trend Toward Empowering States” by David L. Hudson, Jr. The article discusses the May 27th U.S. Supreme Court case of Nevada Department of Human Resources v. Hibbs discussed previously in this post and reports that Georgetown law professor Nina Pillard, who argued for William Hibbs, was told by a colleague that she had a 95% chance of losing the case. The article reports Pillard as saying that a major significance of the case is that it is the first decision in which the court has upheld Congress’ power under Section 5 of the 14th Amendment since 1996 when the court ruled in Seminole Tribe of Florida v. Florida, 517 U.S. 44 (1996), that individuals were limited from suing states under various federal laws.

Attorneys who leave big firms to practice solo are highlighted in this article by Tania Anderson for Washington Business Journal at MSNBC.com: “Solo attorneys like their decision–For those who say big is better, solo attorneys offer a dissenting opinion.” (via MyShingle.com.)

This just in from Reuters: “Siebel shareholders vote against option expensing.” The article reports that TIAA-CREF’s proposal to tie executive compensation to performance was also defeated. Both items were discussed in an earlier post here today.