For Immediate Release
Washington, DC. – The ERISA Industry Committee (ERIC) continues to have concerns regarding the Pension Benefit Guaranty Corporation’s (PBGC) final regulations that require consideration of information unrelated to the health of a pension plan in order to determine whether a plan must make a reportable events filing.
ERIC, the only national trade association advocating solely for the employee benefit and compensation interests of the country’s largest employers, has been very vocal about the PBGC’s efforts to shift the focus away from the pension plan and onto the sponsor. Since 2009, ERIC has opposed eliminating automatic waiver safe harbors. In 2013, ERIC submitted a comment letter and testified against a PBGC proposed rule that would base safe harbors on the credit scores of a plan’s sponsor.
The PBGC did take into account ERIC’s opposition to credit scores and did not make them a mandatory measure of plan sponsor status. The final regulations also continue to offer a safe harbor for plans that do not owe variable rate premiums; however, it did add unnecessary and additional analysis by a plan sponsor. The regulation on reportable events will now require sponsors to gather and analyze financial information that goes beyond the health of the plan. Previous rules focused any required financial analysis solely on the funded status of the plan.
“We believe when determining the reporting of events the PBGC should focus solely on the financial status of the pension plan,” said Annette Guarisco Fildes, president and CEO, ERIC. “This new regulation creates a burden for sponsors that is unnecessary and only adds to the complicated regulatory morass that has driven employers away from offering defined benefit pension plans .”
The effective date for the final regulations is January 1, 2016.