What’s going on in the House regarding cash balance plans and pension plans in general?
(1) Rep. Bernie Sanders (I-Vt.) has introduced more amendments directed at cash balance plans this time trying to tie the hands of the Treasury in assisting in the appeal of the IBM cash balance plan case (you can read all about the cash balance plan controversy in previous posts which you can access here and here.) The American Benefits Council has posted the Amendment on their website as well as a discussion as to why the Amendment is flawed and “harmful to employees’ retirement security.” The discussion piece includes comments by University of Chicago Professor of Law Richard Epstein who is quoted as saying, “[The amendment] itself is contrary to the constitutional principle of separation of powers. The provision prevents the President from faithfully executing the laws and manipulates the appellate process to deny the judiciary access to the views of the Treasury Department, which normally receives deference in interpreting complex statutory provisions.” Professor Epstein further states, “The Executive Branch is effectively handcuffed in its ability to articulate its position in regulations or litigation, and the courts are deprived of an important source of information that allows them to decide an important case.”
(2) Regarding pensions in general, Rep. John A. Boehner (R-Ohio), chairman of the House Education and the Workforce Committee has made remarks regarding his plans for pension reform. You can access his “Six Principles for Fixing America’s Outdated Pension Laws ” here. Regarding cash balance plans, he states that the “continuous threat of legal liability for employers offering cash balance plans is creating ongoing uncertainty and undermining the retirement security of American workers” and that “Congress should consider solutions to ensure cash balance pension plans remain a viable part of the defined benefit system and a positive retirement security option for workers and employers.”
(Thanks to Benefitslink.com for alerting readers to these developments.)