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For Immediate ReleaseContact: Nancy Hwa, 202-296-3776
March 15, 2006www.pensionrights.org

Letter Outlines Consumer Group's Positions on Key Issues in Pension Legislation

WASHINGTON – In a letter delivered today to every member of the Congressional conference committee working on the pension reform legislation, the Pension Rights Center called on the lawmakers to take into account the concerns of millions of employees and retirees, and asked them to support or oppose specific provisions in the legislation.

"This is a massive piece of legislation that in reality only scratches the surface in terms of what needs to be done to address critical pension issues," said Karen Friedman, policy director of the Pension Rights Center and one of the letter’s co-authors.  "We are focusing on the provisions that we feel are most important to protecting the retirement security of American workers."

Specifically, the Pension Rights Center asked Members to support provisions that:

  • protect older employees if an employer converts its traditional pension plan to a cash balance one;
  • close certain loopholes in current pension law that discriminate against older women, widows and divorced spouses; and
  • encourage unbiased investment advice for employees, thereby maintaining a long-standing prohibition against conflicts of interest.

The Center asked Members to oppose provisions that:

  • weaken protections against conflicts of interest in plan investments;
  • allow multiemployer plans to eliminate the special early retirement benefits that workers have already earned; and
  • allow companies to deplete pension plan cushions by increasing the amount of "surplus assets" that can be transferred to retiree health plans – a move that undermines the broader aims of the bill to improve plan funding.

"We certainly want pensions to be adequately funded," said Friedman.  "However, we don't want funding requirements to be made so onerous that employers will simply abandon traditional plans.  Furthermore, the legislation doesn’t even begin to address the recent pension freezes by healthy companies such as Verizon and IBM. Clearly, much more needs to be done to ensure that no more pension promises are broken."

Read the Pension Rights Center's letter to the conferees.