Corporate & Financial Weekly Digest

Corporate & Financial Weekly Digest

Category Archives: Executive Compensation and ERISA

Subscribe to Executive Compensation and ERISA RSS Feed

DOL Proposes to Delay Fiduciary Advice Rule, Requests Comments on Delay and on Costs, Benefits of the Rule

Posted in Executive Compensation and ERISA, Investment Advisers
On March 2, the US Department of Labor (DOL) published a proposed extension (the Proposal) of the effective date of what is commonly referred to as the “fiduciary rule” or the “fiduciary advice rule” (the Rule). The Rule provides that persons who provide investment advice or recommendations for fees or other compensation with respect to… Continue Reading

DOL Proposes to Revise Definition of “Fiduciary” Under ERISA

Posted in Executive Compensation and ERISA
On April 20, the US Department of Labor (DOL) published a proposal to revise portions of the definition of a “fiduciary” under the Employee Retirement Income Security Act of 1974, as amended (ERISA) in the Federal Register. Following is a summary of the proposed new rules. Please note that parts of the proposal are very… Continue Reading

IRS Provides Special Rules for Refund of Employer-Paid Taxes Related to Imputed Income for Same-Sex Spouse Benefits

Posted in Executive Compensation and ERISA
On September 23, the Internal Revenue Service released Notice 2013-61, which provides special rules for those making claims for refunds or adjustments of Federal Insurance Contributions Act (FICA) taxes and federal employment taxes resulting from the Supreme Court’s decision in United States v. Windsor, 133 S.Ct. 265 (2013).… Continue Reading

Court Finds Private Equity Portfolio Company May Have Liability for Withdrawal by Another Portfolio Company

Posted in Executive Compensation and ERISA
The US Court of Appeals for the First Circuit recently delivered a potentially far-reaching decision for the private equity industry. In a case which involved a typical private equity structure, Sun Capital Partners III, LP, et al. v. New England Teamsters & Trucking Industry Pension Fund, et al., the First Circuit adopted a broad view… Continue Reading

Defense of Marriage Act Ruling Has Multiple Effects on Benefit Plans

Posted in Executive Compensation and ERISA
Co-authored by Christopher K. Buch. On June 26, the US Supreme Court ruled in United States v. Windsor that Section 3 of the federal Defense of Marriage Act (DOMA) is unconstitutional. The Supreme Court ruled that DOMA’s federal exclusion of state-recognized same-sex marriages was unconstitutional under the Constitution’s Equal Protection Clause. As a result of… Continue Reading

Amendment of Public Company ESOPs may be Required

Posted in Executive Compensation and ERISA
Co-authored by Gregory K. Brown and Ann M. Kim Many public companies allow their employees to invest a portion of their retirement plan balances in company stock. By making a company stock fund an available investment in a 401(k) plan, employees may share the potential gains otherwise reserved for stockholders. If the stock fund is structured to… Continue Reading

US Supreme Court’s Impending Decision on DOMA May Impact Most Employee Benefit Plans

Posted in Executive Compensation and ERISA
Co-authored by Christopher K. Buch. Late last month the US Supreme Court heard oral arguments in two cases concerning same-sex marriage. The Court’s decisions are expected by the end of June and, depending on how the Court rules, the decisions could have a significant impact on employee welfare and retirement plans.  … Continue Reading

HHS Releases Language for Use in Updating Business Associate Agreements

Posted in Executive Compensation and ERISA
Co-authored by Christopher K. Buch. On January 25, the Department of Health and Human Services (HHS) published its highly anticipated Health Insurance Portability and Accountability Act (HIPAA) Omnibus Final Rule (Final Rule). The Final Rule covers many topics, including the extension of some of HIPAA’s privacy and security compliance obligations to “business associates” or organizations… Continue Reading

IRS Releases Proposed and Final Regulations regarding Health Insurance Premium Tax Credits

Posted in Executive Compensation and ERISA
Co-authored by Christopher K. Buch. On January 30, the Internal Revenue Service released proposed and final regulations regarding the health insurance premium tax credit and the requirement that an employer maintain minimum essential coverage under the Affordable Care Act (ACA). The IRS is preparing to release a series of questions and answers to help individuals… Continue Reading

Significant New Fees for Group Health Plans in 2014-2016

Posted in Executive Compensation and ERISA
Co-authored by Christopher K. Buch. The Department of Health and Human Services (HHS) issued proposed regulations in the Federal Register on December 7 which provide guidance regarding the Transitional Reinsurance Program (the Program). The Program will be effective for three years: 2014–16. It will impose heavy fees upon employer-sponsored health care plans, whether insured or… Continue Reading

Section 409A Transition Relief Deadline Quickly Approaching

Posted in Executive Compensation and ERISA
Co-authored by Christopher K. Buch. As the end of the year approaches, important transition relief from penalties and excise taxes imposed by Section 409A of the Internal Revenue Code (the Code) is about to expire. If an employer has an employment agreement or other nonqualified deferred compensation plan that provides for severance payments to an… Continue Reading

State Levy on Paid Health Care Claims Survives ERISA Preemption Challenge

Posted in Executive Compensation and ERISA
Under the Michigan Health Insurance Claims Assessment Act (HICA Act) (P.A. 142 of 2011), third-party administrators, carriers and self-insured entities are required to pay assessments on the amount of health care claims paid by them. This assessment will be used by the State in funding its Medicaid program. Presumably, the payers will seek to pass… Continue Reading

Employers Must Treat Health Plan Rebates Appropriately

Posted in Executive Compensation and ERISA
One of the many provisions of the Patient Protection and Affordable Care Act, also referred to as the Healthcare Reform Legislation, provides that health insurers must spend a certain portion of the premiums they receive on clinical services and health care quality-improving activities. If an insurer spends less on such services and activities than the… Continue Reading

DOL Revises its Position on Brokerage Windows (Again)

Posted in Executive Compensation and ERISA
The Department of Labor (DOL) continues to revise its stance on the disclosures plan sponsors must make to participants about brokerage windows. DOL regulations require sponsors of participant directed retirement plans to issue statements about the fees paid and the investment returns for investment options under participant-directed plans (such as the typical 401(k) plan). For… Continue Reading

DOL Issues Direct Final Rule Related to Service Provider Disclosures

Posted in Executive Compensation and ERISA
Co-authored by Christopher K. Buch. The United States Department of Labor (DOL) released a direct final rule on July 13, that amended the procedures retirement plan fiduciaries are to use for reporting a covered service provider’s (CSP’s) failure to furnish the newly required disclosures related to the CSP’s compensation and possible conflicts of interest.… Continue Reading

IRS Provides Guidance on Reduction in Health FSA Limit to $2,500

Posted in Executive Compensation and ERISA
The Internal Revenue Service recently published Notice 2012-40 in which it provided guidance with regard to the $2,500 limitation effective next year for health flexible spending arrangements (Health FSAs) subject to Internal Revenue Code (Code) Section 125. The reduction in the maximum amount of contribution (from the current limit of $5,000) was enacted as part… Continue Reading

New IRS Regulations Imposing Fees Upon Self-Insured Plans and Health Insurance Policies

Posted in Executive Compensation and ERISA
Co-authored by Christopher K. Buch. On April 17, the Internal Revenue Service published in the Federal Register proposed Regulations setting forth the details for the new fees imposed upon self-insured plans and health insurance policy issuers. These fees were mandated in the Patient Protection and Affordable Care Act (PPACA) and are effective for current plan… Continue Reading

DOL Plans to Propose Format for Service Provider Fee Disclosures; No Required Format for 2012 Disclosures

Posted in Executive Compensation and ERISA
As part of its efforts to effect transparency of fees paid by plans subject to the Employee Retirement Income Security Act of 1974 (ERISA) to investment managers and other service providers, the U.S. Department of Labor (DOL) has indicated that it will develop and propose a required format for a "summary guide" of the disclosures… Continue Reading

Important Deadlines for ERISA Plans to Receive and Report Information on Fees, Expenses

Posted in Executive Compensation and ERISA
Co-authored by Ann M. Kim Coming up this summer are a number of reporting and disclosure deadlines under the Employee Retirement Income Security Act of 1974 (ERISA) that deal with fees and expenses paid by plans that are subject to ERISA.  Service providers to such plans, including investment managers who manage plan assets, and other… Continue Reading