P>The House Committee on Education and the Workforce recently moved pension reform
legislation one step closer to approval by the Pension Protection Act (H.R.
2830). The measure was approved in a 27-to-0 vote, with all committee Republicans
voting in favor, and all committee Democrats merely voting "present."For a Limited Time receive a
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Get Your Report Now!The Act includes new funding requirements to ensure that employers adequately
and consistently fund their pension plans, and provides workers in single and
multi-employer plans with better information about the financial status of their
pension plans. It
also protects taxpayers from a
potential multibillion-dollar bailout of the Pension Benefit Guaranty Corporation
(PBGC), according
to Committee Chairman John Boehner (R-Ohio).
In addition, Boehner said the bill:
- Requires employers to meet a
100 percent funding target,
- Prohibits the use of credit
balances for severely
underfunded plans,
- Phases in increases in
employer premiums paid
to the PBGC,
- Allows employers to give
rank-and-file employees
access to high-quality
investment advice, and
- Includes numerous reforms
to multi-employer pension
plans governed by collective bargaining agreements to
give trustees additional tools
to fund their benefit promises.
The committee approved a substitute amendment offered by Boehner.
For all defined benefit plans, the amendment establishes a simple
age discrimination standard that
clarifies current law regarding
age discrimination requirements under ERISA on a prospective
basis, he said.
Under the measure, employers are also prohibited from reducing or cutting any
vested benefits that workers have earned during a conversion to a cash balance
plan. The House's Ways and Means Committee was also reviewing the legislation
at press time.