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Glass Lewis Updates Proxy Voting Guidelines for 2019

November 30, 2018

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On October 24th, Glass Lewis published its updated proxy voting guidelines for 2019.  Some key compensation-related changes for reporting companies to keep in mind are highlighted below:

Excise Tax Gross-ups

When any new excise tax gross-ups are provided for in executive employment agreements, Glass Lewis may recommend against members of the compensation committee, particularly where a company previously committed not to provide gross-ups in the future.  Glass Lewis is particularly opposed to gross-ups related to excise taxes on excess parachute payments.  New gross-up provisions with respect to these excise taxes may lead to negative recommendations for a company’s say-on-pay proposal.

Contractual Payments and Arrangements

The new guidelines clarify the terms that may contribute to a negative voting recommendation on say-on-pay proposals.  When evaluating sign-on and severance arrangements, Glass Lewis will consider the size and design of any payments as well as U.S. market practice.  Glass Lewis will consider the executive’s

Bryan Cave Publishes 2018 In-House Counsel Guide to Data Privacy and Security

Bryan Cave is proud to present the third version of our in-house counsel’s guide to data privacy and security. The guide provides an overview of laws relevant to a variety of data matters topics, statistics that illustrate data privacy and security issues, and a breakdown of these data-related issues. It covers a range of privacy and security issues that apply in the HR and employee benefits areas, including HIPAA compliance and enforcement.

You may download a copy of the 2018 guide by clicking here.

Revised VCP Fees – Simple Isn’t Always Better

Revised VCP Fees – Simple Isn’t Always Better

January 18, 2018

Authored by: benefitsbclp

The Internal Revenue Service (“IRS”) has described its recent changes to its Voluntary Correction Program (“VCP”) user fees as “simplification.”  This simplification is achieved by significantly changing the way user fees are determined and by eliminating alternative and reduced fees that were previously available.   At first blush, this simplification appears to result in a general reduction in user fees, however, in certain circumstances, the changes will actually result in significantly higher fees.   If you are the person responsible for issuing or requesting checks for your plan’s VCP application(s), it is important to note the differences from the past fee structure so that you will know what your plan is in for (good or bad) the next time a VCP application is necessary.

In case you are not familiar with the VCP, the IRS created the program under its Employee Plans Compliance Resolution System, to allow tax-favored retirement plans not

Payroll and HR Professionals Beware: Phishing Schemes are now Trying to Lure You

March 7, 2016

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ThinkstockPhotos-465512675 (2)ALERT, ALERT!!!! The IRS has renewed a consumer alert for e-mail schemes regarding phishing and malware incidents targeted at individuals. That renewal came after an approximate 400 percent surge in such incidents so far this tax season. The 400 percent surge was not the end of the phishing schemes this tax season, and now a phishing scheme is emerging to target payroll and HR.

The IRS has also issued a second alert to warn about additional scams this tax season which are designed to trick HR and payroll professionals to provide personal information on employees. Unlike prior scams, the e-mails are no longer just designed to trick taxpayers into thinking the IRS is attempting to contact them for personal information. This latest phishing scheme is a variation known

The FAST Act – If You Blinked You May Have Missed It.

The FAST Act – If You Blinked You May Have Missed It.

January 7, 2016

Authored by: Denise Erwin

MovingDeadlinesOn December 3, 2015, the President signed into law the Fixing America’s Surface Transportation Act (the “FAST Act”) which provides for five years of funding for highway projects.  If you just skimmed the news on this one, you may not have noticed that the FAST Act included a repeal of the extension to the Form 5500 filing deadline that was provided under the stop-gap Surface Transportation and Veterans Health Care Choice Improvement Act of 2015 that was passed in August.

As we reported in our previous blog post, the Surface Transportation and Veterans Health Care Choice Improvement Act of 2015 provided that, beginning in 2016, the automatic extension for the Form 5500 would be extended from 2½

Congress Engages in Some Holiday Spending on Benefits

Congress’s recent $1.8 trillion holiday shopping spree (aka The Consolidated Appropriations Act, 2016, which became law on December 18, 2015) included a few employee benefit packages. We recently unwrapped the packages. Here is what we found.

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1.   Cadillac Tax Delayed. The largest present under the employee benefits tree is a delay in the so-called “Cadillac” tax, which as originally enacted imposed a 40% nondeductible excise tax on insurers and self-funded health plans with respect to the cost of employer-sponsored health benefits exceeding statutory limits. The tax is now scheduled to take effect in 2020 rather than 2018. Once – or if – the delayed tax provision becomes effective, it will be deductible. The cost of this gift is $17.7 billion.

Since the Cadillac tax is basically unadministrable in its current form, we can’t imagine there is even one person at Treasury

Dodd-Frank SEC Guidance Executive Compensation – Status

Dodd-Frank SEC Guidance Executive Compensation – Status

November 2, 2015

Authored by: benefitsbclp

With all the rulemaking required under the Dodd-Frank Act, it can sometimes be hard to keep up with the status of the various rules.  Below is a handy chart that details the current status of the various executive compensation rulemakings.  We plan to update this periodically for additional rulemakings, so be sure to come back and visit from time to time.

Last Updated: November 2, 2015

Provision Summary Status of SEC Rulemaking Say on Pay; Say on Golden Parachutes § 951 Requires advisory vote of shareholders on executive compensation and golden parachutes; advisory vote on frequency of say on pay

  • Final rule: adopted January 25, 2011; SEC Rel. No. 33-9178

Compensation Committee Independence § 952(includes comp consultant conflicts) Requires stock exchanges to adopt listing standards that require:

  • compensation committee members to be “independent;”
  • each committee must   have the authority to engage

Illinois Introduces Mandatory Retirement Plan Law

January 20, 2015

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Illinois Introduces Mandatory Retirement Plan Law

January 20, 2015

Authored by: benefitsbclp

Illinois Welcome Sign

Earlier this month, Illinois became the first State to enact legislation that requires private-sector employers who do not offer qualified retirement plans to enroll their employees in individual retirement accounts (i.e., “IRAs”). Now-former Governor Pat Quinn signed the Illinois Secure Choice Savings Program Act (“Act”) into law on January 4, 2015.

The Act, which will become effective with enrollment occurring sometime in the next 24 months, has a broad reach. The following provides a high-level summary of the applicability of (and requirements under) the Act:

What Employers are Subject to the Act?

For any given year, the Act applies to any employer that:

  • Is a private for-profit or non-for-profit company engaged in business

The Ball Dropped on 2015 – Now Here’s Our “Top Ten” List for Fiduciaries

Happy New Year! As part of our annual tradition in helping retirement plan fiduciaries get started down the right path in the new year, we’re pleased to present our Top Ten New Year’s Countdown. But, wait, what’s better than a Top Ten Countdown list to kickoff 2015? How about a Top Ten list set to Pop Culture themes that dominated 2014? Well, here goes nothing…. Because we’re happy (clap along if you feel like a fiduciary without a roof):

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1. It’s all About The Fees, about the Fees, No trouble. Another year, another reminder (thank you, Meghan Trainor) that fees should be closely scrutinized by plan fiduciaries. Participant fee disclosures are not the new kid on the block anymore; however, fiduciaries should still ensure that all required fee disclosures are complete, accurate and made

Thanks, ERISA, and Happy 40th!

September 3, 2014

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Thanks, ERISA, and Happy 40th!

September 3, 2014

Authored by: benefitsbclp

Forty years ago yesterday, September 2, 1974, Congress passed the Employees Retirement Income Security Act of 1974.  Most, maybe all, of the people reading this blog owe their careers to a single piece of legislation that has spawned growth industries and cottage industries.  The acronym “ERISA” has special meaning to all who work in the employee benefits industry.

ERISA exists in no small measure due to three factors:  (1) the ineptitude and greed of those running the automobile manufacturer, Studebaker–Packard Corporation back in the early 1960s; (2) the mismanagement and abuse (likely theft with no federal recourse to protect participants) of the world’s then largest pension fund by the executives of the Teamsters Union; and (3) the legislative tenacity of Senators Jacob Javits and Harrison Williams.  These factors forged together over a decade to get ERISA passed.  The legislative debate was one of the most significant management versus

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