Thursday, February 12, 2009

ERISA slaps Congress for failure to help DB sponsors

The failure of federal lawmakers to include provisions for funding relief to defined benefit plan sponsors in the pending $789 billion economic stimulus legislation has been criticized by the ERISA Industry Committee.

ERIC and other lobbying groups for employers have been arguing that cash-strapped plan sponsors are having trouble meeting new funding obligations under the Pension Protection Act of 2006.

Without some relief, representatives of the lobbying groups are contending that plan sponsors might have to lay off employees or cut back on employer contributions to 401(k) plans to pay their DB contributions.

“It is clear that Congress recognizes the dangerous nature of the economic downturn, but it missed an opportunity to provide a shot in the arm to the economy at no cost to taxpayers,” said Mark Ugoretz, ERIC president, in a news release.

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