News
Category: Announcements
Amid an economic crisis affecting regions around the world, Time Magazine calls Pittsburgh “One Bright Spot on Main Street.” Click that headline to read the article, published this week, that looks at how the Pittsburgh region’s transformation over the last 25 years to a more diverse economy has enabled us to weather the storm of uncertainty better than many others – and how we are not only surviving but actually investing for our future prosperity.
...in the Pittsburgh Business Times (full article requires a subscription):
Senior executives are taking a much more active role in administering 401(k) plans than in the past, according to a survey of more than 125 employers in the tri-state area around Pittsburgh.
Of the respondents in this year’s survey by Downtown Pittsburgh-based consultant Cowden Associates Inc., 94 percent said senior executives are involved in making decisions about investments, up from 30 percent in 2007.
...in the Pittsburgh Post-Gazette (full article):
The survey of 128 area employers also found that 25 percent of companies were automatically enrolling employees in 401(k) plans, up from 16 percent in 2007.
Cowden said the survey also identified a major deficiency among plan sponsors: One-quarter said they did not have an investment policy statement, which outlines the general investment goals and objectives of a retirement plan.
...in the Pittsburgh Tribune-Review (full article):
Employers in the Pittsburgh region are taking action to retain and attract top employee talent by increasing contributions to their workers' 401(k) and related retirement plans well above the standard 3 percent mark, a consultant's survey found.
Cowden Associates Inc.'s second annual survey of employers who sponsor defined-contribution plans released Thursday found a substantial year-over-year percentage increase in employer matching contributions.
Cowden Associates survey finds significant changes in investment decision-making process
Significantly more senior executives are taking a direct role in decisions regarding their organization’s 401(k) plans than in the past, according to Cowden Associates, Inc.’s Second Annual Tri-State Defined Contribution Plan Sponsor Survey.
Of the respondents to this year’s survey, 94 percent indicated that their senior executives are involved in the investment decision-making process, compared with 30 percent in 2007.
More than 125 employers throughout the tri-state region participated in this year’s survey, which was conducted during March and April, and provided information on their location, size, total plan assets, type of organization, and eligibility for and participation in the plan.
In June, President Bush signed into law H.R. 6081: Heroes Earnings Assistance and Relief Tax Act of 2008 (HEART Act), providing tax benefits and incentives to employees in qualified military service as defined by the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA). The provisions have varied impact on many benefits, including 403(b) plans, governmental 457(b) plans, IRAs, and health flexible spending accounts. A full summary can be found at GovTrack.us.
Cowden Associates' 2007/2008 Tri-State Employee Benefits Survey featured in the Pittsburgh Business Times:
A survey by Downtown employee benefits consultant Cowden Associates Inc. found that the number of businesses adopting some form of the so-called consumer-driven health care plan more than tripled since last year, but 107 out of 274 respondents, or 62.9 percent, said they were unlikely to offer the coverage in the future. Another 37 respondents, or 21.8 percent, said they had no interest in the plans, which usually incorporate a health reimbursement or savings account.
"It's a big change, and employees are not necessarily looking for big changes in the way their benefits are structured," said Cowden Executive President Vincent Wolf. "We seem to have hit a threshold, a ceiling, with these types of plans."
The full article requires a subscription.
Employers in Pennsylvania, West Virginia and Ohio believe the future of managing health care costs lies in helping their employees manage their health through wellness programs, according to Cowden Associates, Inc. Seventh Annual Tri-State Area Employee Benefit Survey.
Cowden Associates, the region's leading independent human resources, compensation and employee benefit consulting firm, compiled results of its 2007-2008 survey from 274 employers throughout the tri-state region. Survey participants include for-profit, nonprofit and governmental employers. Size of employers ranged from less than 100 employees to more than 10,000.
"Competition for talented employees is strong, and employee benefits play a critical role in attracting and retaining those employees," said Cowden Associates President and CEO Jere Cowden. "As regional employers work to attract and retain talent in part through strong employee benefits plans, our regional survey data allow them to benchmark themselves against their regional competition and develop attractive, cost-effective plans."
Join Cowden Associates on January 31, 2008 for a complimentary breakfast and seminar. Recent guidelines regarding default investments and fee disclosures have added important clarification. Process and documentation are critical features. This seminar will focus on practical examples and walk through actual case studies. Topics to be covered include:
- Formation and duties of an Investment Committee
- Review/creating Investment Policy Statements
- Investment review and selection of plan offerings
- Qualified Default Investment Alternative (QDIA)
- Full fee disclosures
- Performance monitoring and changes in offerings
- Documenting the process and rationale
- Employee communications
- Evolving DOL Fee disclosure requirements including 5500 data
This is your opportunity to learn the critical features of process and documentation requirements now required by Plan Sponsors.
PLANSPONSOR.com reports on a key 401(k) fiduciary breach case (free registration required) that is scheduled for Supreme Court Session beginning October, 2007. The case (LaRue v. DeWolff, Boberg & Associates, U.S., No. 06-856) will determine if 401(k) participants can sue to restore their account balance when a fiduciary breach results in lost money. Lower courts ruled that recovering those funds falls outside of the scope of "equitable relief" authorized by ERISA.
If overturned, plan sponsors could be facing significant liability without strict fiduciary controls and a well defined and carefully followed Investment Policy Statement.
Let’s look at the key points:
- The U. S. Supreme Court “will decide” whether participants can sue to restore their account balances when a “fiduciary breach” caused them to lose money. Think ENRON!
- The U. S. Solicitor General stated in legal briefs filed with the court that: “It makes little sense that plans and their participants should be left with no relief when plan assets are lost through fiduciary mismanagement.” This puts all fiduciaries and co-fiduciaries on notice that they will, if the court rules in favor, have to “put their money where their investments are.”
Cowden Associates recently hosted a series of Pension Protection Act workshop’s for defined contribution plan sponsors that currently provide or are considering 401(k), 403(b), 457 and other Defined Contribution Plans.
The workshop focused on the Pension Protection Act of 2006 in an interactive format that allowed Plan Sponsors the chance to investigate the issues and opportunities created by the passing of the Act.