Employee Benefit Plans in a Nutshell(Nutshells)

by Conison, Jay

• ISBN13: 9780314150837
• ISBN10: 0314150838
• eBook ISBN(s): 9781628105353
• Edition: 3rd
• Format: Paperback
• Copyright: 2003-11-05
• Publisher: West Academic Publishing
• More Book Details
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Summary

This authoritative coverage provides the background needed to acquire a thorough understanding of employee benefits law. Text covers plan finance and taxation; economic aspects; regulations; ERISA (Employee Retirement Income Security Act) legislative background; vesting; participation, accrual, and non-interference; distribution; employee securities; employee stock ownership plans; preemption; nondiscrimination; and plan termination.

Table of Contents

Preface	v
Table of Cases	xxvii
Table of Statutes and Regulations	xlv
Overview and Basic Concepts	1	(22)
Plans and the Scope of Erisa	1	(11)
What Is a Plan?	1	(2)
Varieties of Plans	3	(1)
Pension Plans	3	(4)
Welfare Plans	7	(1)
Multiemployer Plans	8	(1)
Pension and Welfare Plans Covered by Erisa	9	(1)
Title I	9	(2)
Title II	11	(1)
Persons Associated With Plans	12	(3)
Overview of Erisa Regulation	15	(8)
The Structure of Title I	16	(3)
The Structure of Title II	19	(1)
The Structure of Title IV	20	(1)
The Allocation of Regulatory Authority	21	(2)
Basic Plan Finance and Taxation	23	(10)
Present Value	23	(2)
Valuing Pensions	25	(2)
Individual Tax Advantages	27	(3)
Firm Tax Advantages	30	(3)
Economic Aspects of Plans	33	(23)
Plans as Business Activities	33	(5)
Plans as Retirement Security Programs	38	(7)
National Policy	39	(5)
Plan Design	44	(1)
Plans and Compensation	45	(3)
Plans and Corporate Finance	48	(5)
Plans and Financial Markets	53	(3)
Traditional Frameworks for Plan Regulation	56	(14)
The Problem of Expectations	56	(1)
The Common Law Answers	57	(7)
Statutory Regulation Before Erisa	64	(6)
The Legislative Background to Erisa	70	(8)
The Motivations for Erisa	70	(2)
The Policy Underpinnings of Erisa	72	(2)
The Incompleteness of Erisa	74	(4)
Benefit Protection: Vesting	78	(18)
The Vesting Problem	78	(1)
Vesting Standards	79	(12)
Vesting of the Normal Retirement Benefit	80	(1)
Vesting of Accrued Benefits	81	(5)
Forfeitures	86	(2)
Vesting Upon Plan Termination	88	(2)
Vesting Rules for Top--Heavy Plans	90	(1)
What Benefits Are Nonforfeitable?	91	(5)
Benefit Protection: Participation, Accrual and Non-Interference	96	(22)
Participation	96	(2)
Accrual of Benefits	98	(16)
Accrued Benefits in General	98	(2)
Defined Benefit Plans: Anti--Backloading Rules	100	(1)
The 3 Percent Rule	100	(2)
The 133--1/3% Rule	102	(2)
The Fractional Rule	104	(1)
Insurance Plans	105	(1)
Defined Benefit Plans: Age Discrimination Rules	106	(1)
Defined Contribution Plans	106	(1)
Top--Heavy Plans	106	(1)
Plan Amendments and Accrued Benefits	107	(4)
Cash Balance Plans	111	(3)
Protection of Benefit Rights in the Work-place	114	(4)
Benefit Distribution: Substantive Standards	118	(32)
Annuities	118	(9)
Annuities and Actuarial Principles	119	(2)
Annuities and Spousal Protection	121	(1)
The Need for Spousal Protection	121	(2)
Required Forms for Annuities	123	(2)
Who is a Spouse?	125	(1)
Waiver and Election	125	(2)
Non--Annuity Payments	127	(7)
Lump Sum Payments of Benefits	127	(2)
Cash Outs	129	(1)
Spousal Consent	130	(1)
Plan Loans	130	(4)
Non--Retirement Benefits	134	(5)
Allowable Benefits	135	(1)
Death Benefits	136	(2)
Payments of Accrued Benefits to Beneficiaries	138	(1)
Timing of Distributions	139	(2)
Consent	139	(1)
Required Beginning	139	(1)
Limits on Participant Delay	139	(1)
Death Distributions	140	(1)
Anti-Alienation Rules	141	(9)
The Basic Provision	141	(1)
Welfare Benefit Plans	142	(1)
Personal Bankruptcy	143	(2)
Qualified Domestic Relations Orders	145	(3)
Other Statutory Exceptions	148	(1)
Benefit Offsets	148	(2)
Taxation of Distributions	150	(15)
Annuities	150	(5)
Amounts Received as an Annuity---Basic Rules	151	(1)
Simplified Exclusion Method	152	(1)
Amounts Not Received as an Annuity	153	(1)
Separate Contracts	154	(1)
Lump Sum Distributions	155	(2)
Rollovers and Trustee--to--Trustee Transfers	157	(5)
Rollover Distributions	158	(1)
Eligible Rollover Distributions	158	(1)
Transfer to the New Plan	159	(1)
Distributions to Spouses	160	(1)
Withholding Tax	161	(1)
Notice	161	(1)
Direct Transfer of Rollover Distributions	162	(1)
Additional Tax on Early Distributions	162	(3)
Benefit Payment: Procedure	165	(29)
Plan Claims Procedures	165	(13)
The Meaning and Purpose of the Requirement	165	(4)
Standards for a Reasonable Claims Procedure	169	(1)
Basic Standards	170	(1)
Claim Determination---All Plans	171	(2)
Claim Determination---Group Health Plans---Initial Determination	173	(2)
Claim Determinations---Group Health Plans---Review	175	(2)
State Law	177	(1)
Suits for Benefits	178	(12)
Policy Considerations	178	(1)
The Character of the Suit for Benefits	179	(1)
The Labor--Law Model	179	(2)
The Trust--Law Model	181	(1)
Caselaw Development	182	(6)
The Proper Defendant	188	(1)
The Availability of Jury Trial	189	(1)
Liabilities Incidental to Benefit Payments	190	(4)
Plan Information	194	(30)
Reporting and Disclosure	194	(17)
The Rationale for the Requirements	195	(1)
The Required Reports and Documents	196	(1)
Summary Plan Description	197	(2)
Summary of Material Modifications and Changes	199	(1)
Annual Report	199	(3)
Summary Annual Report	202	(1)
Reporting to Government Agencies	203	(1)
Disclosure to Participants	204	(3)
Determination of Qualified Status	207	(1)
Additional Requirements	208	(1)
Remedies and Sanctions	209	(2)
The Writing Requirement	211	(13)
The Rationale for the Writing Requirement	212	(1)
Conflicts Between the Plan Document and the SPD	213	(4)
The Status of Oral Plans	217	(1)
The Existence of Oral Plans	217	(1)
The Amendability of Oral Plans	217	(1)
Oral Representations at Variance With Plan Terms	218	(1)
Purported Oral Amendments	218	(1)
Individualized Oral Representations	219	(5)
Fiduciary Regulation	224	(58)
Plan Fiduciaries	224	(13)
Basic Characteristics of Plan Fiduciaries	224	(2)
Denominated Fiduciary Roles	226	(1)
Named Fiduciary	226	(1)
Trustee	227	(1)
Allocation of Fiduciary Responsibility	228	(1)
Administrator	229	(1)
Investment Manager	230	(1)
Investment Advisor	231	(1)
Other Fiduciaries	232	(1)
The Function and Discretion Standard	232	(2)
Attorneys and Other Professionals	234	(1)
The Employer as Fiduciary	235	(1)
Term of Fiduciary Office	236	(1)
Trust and Related Requirements	237	(11)
Plan Assets	237	(1)
Plan Assets vs. Funds or Other Property	237	(1)
Time of Asset Acquisition	238	(1)
Mutual Fund Interests	239	(1)
Other Investments	239	(1)
Guaranteed Benefit Policies	240	(3)
The Trust Requirement	243	(1)
Non-Inurement	244	(1)
Bonding Requirements	245	(2)
Prohibited Persons	247	(1)
Fiduciary Standards	248	(22)
The Structural Character of Erisa Fiduciary Duties	249	(1)
The Duty of Loyalty	250	(1)
To Whom Is The Duty Owed?	251	(2)
What Employer Conduct Is Subject to the Duty?	253	(2)
Pegram and the Functional Approach	255	(2)
Employer Conflicts of Interest	257	(6)
Other Fiduciary Duties	263	(1)
Prudence	263	(2)
Diversification	265	(2)
Non--Deviation	267	(1)
Truthfulness and Information	267	(2)
Cofiduciary Responsibility	269	(1)
Limitations on Fiduciary Responsibility	270	(5)
Limitations Resulting From Allocation Rules	270	(2)
Directed Trustees	272	(1)
Exculpatory Provisions, Insurance and Indemnification	273	(1)
Participant--Directed Accounts	274	(1)
Remedies for Breach of Duty	275	(7)
Suits Against Fiduciaries	275	(1)
Erisa § 409	275	(3)
Erisa § 502(a)(3)	278	(1)
Civil Penalties	279	(1)
Suits Against Non--Fiduciaries	280	(2)
Prohibited Transactions	282	(18)
Parties in Interest	282	(1)
Prohibited Fiduciary Conduct	283	(9)
The Party in Interest Rules	284	(1)
Property Transactions	285	(1)
Loans	286	(1)
Goods and Services	286	(1)
Asset Transfer	287	(1)
Employer Stock and Employer Real Property	287	(1)
Corresponding Code Provisions	288	(1)
The Self-Dealing Rules	288	(1)
Self--Dealing and Adverse Interest	288	(3)
Kickbacks	291	(1)
Exemptions	292	(5)
Statutory Exemptions	292	(1)
Participant Loans	293	(1)
Operating Contracts	293	(1)
Banks and Insurers	294	(1)
Statutory Clarifications	294	(1)
Administrative Exemptions	295	(2)
Remedies	297	(3)
Fiduciaries	297	(1)
Parties in Interest	297	(3)
Employer Securities and Employee Stock Ownership Plans	300	(82)
Employer Securities	301	(5)
Definitions	301	(2)
Prohibited Transactions and Exemptions	303	(2)
Exceptions to Fiduciary Requirements	305	(1)
ESOPS	306	(66)
ESOPS in General	306	(1)
Leveraged ESOPS	307	(2)
ESOP Loans	309	(1)
Primary Benefit	309	(1)
Release of Collateral	310	(1)
Further ESOP Requirements	310	(1)
Designation	311	(60)
Minimum Age and Service Requirements	371	(1)
Former Employees	372	(1)
Separate Line of Business Rules	372	(5)
LOBs	374	(1)
SLOBs	374	(2)
QSLOBs	376	(1)
Minimum Participation Test	377	(5)
Plans Tested	378	(1)
Employees Considered	379	(1)
Other Rules	380	(1)
Exemptions	381	(1)
Nondiscrimination: Contributions or Benefits	382	(29)
The Basic Standard	383	(1)
Nondiscrimination in Amount of Contributions or Benefits	384	(12)
Defined Contribution Plans	385	(1)
Safe Harbors	385	(2)
General Test	387	(1)
Defined Benefit Plans	388	(1)
Safe Harbors	388	(3)
General Tests	391	(1)
Cross--Testing	392	(2)
Complicating Factors	394	(1)
Former Employees	394	(1)
Employee Contributions	394	(1)
Combined Plan	395	(1)
Plan Restructuring	395	(1)
Integration and Disparities	396	(10)
Section 401(l) Permitted Disparity	397	(1)
Defined Contribution Excess Plans	398	(1)
Defined Benefit Excess Plans	399	(1)
Defined Benefit Offset Plans	400	(2)
Additional Requirements for Defined Benefits Plans	402	(1)
Overall Permitted Disparity	402	(2)
Imputed Disparity	404	(1)
Adjusted Allocation Rate	404	(1)
Adjusted Accrual Rate	405	(1)
Social Security Offset Plans	406	(1)
Nondiscrimination in Benefits, Rights and Features	406	(2)
Nondiscrimination in Amendments	408	(1)
Retroactive Corrections	409	(2)
Additional Limitations on Contributions and Benefits	411	(5)
Defined Contribution Plans	412	(1)
Defined Benefit Plans	413	(1)
Aggregate Limitations	414	(2)
Cash or Deferred Arrangements	416	(13)
Qualified Cash or Deferred Arrangements	417	(2)
Basic Qualification Requirements	417	(1)
Contributions to CODAs	418	(1)
Other Benefits	419	(1)
Nondiscrimination Standards	419	(7)
Coverage	419	(1)
Contributions	420	(1)
The Actual Deferral Percentage Test	420	(1)
Calculating the ADP	421	(2)
Safe Harbor	423	(1)
Excess Contributions	424	(2)
Catch--Up Contributions	426	(1)
Simple 401(k) Plans	426	(3)
Eligible Employers	427	(1)
Simple Plan Requirements	427	(2)
Funding and Contributions	429	(24)
Basic Actuarial Principles	430	(7)
Actuarial Present Value	430	(1)
The Calculation of Benefit Costs	431	(1)
Unit Credit Method	432	(2)
Entry Age Normal Method	434	(3)
Funding Standards	437	(12)
The Basic Funding Rules	437	(1)
Required Contribution	437	(1)
Funding Standard Account	438	(1)
Alternative Minimum Funding Standard	439	(1)
Actuarial Cost Methods	440	(1)
Timing	441	(1)
Modifications of the Basic Rules	442	(1)
Additional Funding Requirements	442	(1)
Full Funding Limitation	443	(1)
Money Purchase Plans	444	(1)
Employer Inability to Meet Funding Standard	445	(1)
Variances	445	(1)
Change in Funding Method	446	(1)
Retroactive Amendments	446	(1)
Notices	447	(1)
Penalties	447	(2)
Deductions for Contributions	449	(4)
Stock Bonus and Profit Sharing Plans	449	(1)
Defined Benefit and Money Purchase Plans	450	(1)
Combinations of Plans	451	(1)
Penalties	452	(1)
Plan Termination	453	(32)
Overview of Regulation	453	(2)
Internal Revenue Code	453	(1)
Title I	454	(1)
Title IV	454	(1)
The PBGC and the Benefit Guaranty Program	455	(7)
The PBGC	455	(1)
Plans Covered	456	(1)
Plan Termination Insurance	456	(2)
Single-Employer Plan Benefits Guaranteed	458	(2)
Multiemployer Plan Benefits Guaranteed	460	(1)
The PBGC Financial Position	461	(1)
Reporting to the PBGC	462	(2)
Single--Employer Plan Terminations	464	(12)
Standard Terminations	464	(2)
Distribution of Plan Assets	466	(2)
Distress Terminations	468	(3)
Liability for Underfunding	471	(1)
Involuntary Terminations	472	(1)
Triggering Events	472	(1)
Appointment of Trustee	473	(1)
Termination Proceedings	473	(1)
Sponsor Liability	474	(1)
Plan Restoration	475	(1)
Reversions	476	(4)
The Purchase of Annuities	480	(2)
Withdrawal Liability	482	(3)
Index	485