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Conversation on Coverage Plan Will Help Small Employers Provide Benefits
In a recent Washington Post article, the Conversation on Coverage’s Model T Plan was shown to appeal to small business owners because of its simplicity. Jeanette Howarth, co-owner of a small construction company in Michigan, would like to offer her employees a retirement plan that is not administratively burdensome while providing them with an easy and automatic way to save for retirement. She told the Post’s Martha Hamilton that the Conversation’s Model T plan would help her provide pension benefits to her employees without the administrative complexities that are often associated with offering these plans. Of the plan she says, “A lot of things have been worked out that have addressed some of the frustrations” small employers can face when offering these plans. Find this article and others about the Conversation in the PRC in the News section of our web site. The Conversation on Coverage is a PRC initiative that brought a diverse group of experts together to develop new solutions to address the nation’s pension coverage problem.
PRC Comments and New House Bill Focus on Disclosure of 401(k) Fees
In comments submitted to the Department of Labor, the Pension Rights Center called for the DOL to require 401(k) plans to provide fee disclosure statements that show the dollar amount of investment management, record keeping and other costs that 401(k) participants pay each year. PRC’s comments were submitted the same day that Representative George Miller (D-CA-7) introduced the 401(k) Fair Disclosure for Retirement Security Act of 2007, which would require 401(k) and similar plans to tell participants in writing about the fees associated with investing in the plans. According to Representative Miller, “hidden fees are eating into the retirement savings of millions of American workers without them knowing it.” PRC’s comments can be found on the What’s New page of our web site.
Senate Bill Addresses Key Concern of Pension Counseling Project Clients
Senator Tom Harkin (D-IA) recently introduced the Restoring Pension Promises to Workers Act of 2007, which contains a number of provisions that would “help ensure Americans’ pensions will be there for them when they retire.” Included among the bill’s provisions is a measure aimed at addressing a common problem for clients of the Administration on Aging’s regional counseling projects. After receiving pension payments for a number of years, many retirees and widows are told by a plan administrator that a mistake has been made in the calculation of their benefit. As a result of this miscalculation, they are required to make repayments to the plan even if it would be a severe hardship for them to do so. Read PRC’s summary of this and the bill’s other provisions in the legislation section of our web site. PRC’s National Pension Assistance Resource Center provides training and technical assistance to the regional pension counseling projects.
Michael Moore’s Sicko Web Site Refers to PRC List of Pension Freezes
Michael Moore’s new movie about the health care industry, Sicko,has caused quite a stir by drawing attention to inadequate health care and cutbacks in benefits for American workers. One of the resources listed on the movie’s web site is a Pension Rights Center’s fact sheet that lists companies that have made changes to their defined benefit pension plans. These changes include plan freezes, terminations and changes to the formula used to calculate pension benefits. Started in 2005 when Verizon announced it would become one of the nation’s first financially-healthy companies to freeze its pension plan, this list includes information about almost 60 companies that have significantly reduced pension benefits for their employees. The list of companies that have changed their defined benefit pension plans is one of many fact sheets on our web site.
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