The House Education and Labor Committee plans to add modest funding relief for defined-benefit pension plans to a 401(k) plan fee disclosure bill scheduled for a vote Wednesday, June 24.
Provisions expected to be added would delay the effective date of regulations mandated under a 2006 law that toughened pension funding requirements.
Under current law, the rules can be effective as soon as July 1.
The amendments would delay the effective date until at least January 1, 2010.
In addition, employers would be given more flexibility in choosing an interest-rate methodology to value pension plan liabilities this year and next year.
On the other hand, more employers would be required to report plan actuarial and financial information to the Pension Benefit Guaranty Corp. Under current law, only plans that are less than 80 percent funded have to report this information to the PBGC.
The legislation would change that requirement to require a PBGC report if plan underfunding exceeded $50 million. Such a change is needed, according to a committee summary.
“Since large plans that are more than 80 percent funded can still be underfunded by hundreds of millions of dollars, the PBGC is not getting information on many underfunded plans,” according to the summary.
The core of the legislation, H.R. 1984, would require 401(k) and other defined-contribution plan sponsors to improve disclosure of fees and other financial information to plan participants.
Filed by Jerry Geisel of Business Insurance, a sister publication of Workforce Management. To comment, e-mail editors@workforce.com.
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