Searching for Hidden Treasure
I’ve spent the last few weeks trying to uncover information about the retirement plan decision-makers at various companies. I’m willing to pay money for this information. Why?
Simply put, I want to know who has responsibility for making multi-million dollar decisions that affect thousands of employees and retirees. Once identified, I’d like to read their bios, understand how they were selected, read about how they are evaluated and identify to whom they report.
Unfortunately, my quest has provided scant results. Here is a summary of what I know. (I welcome comments about possible data sources.)
1. There is no universally accepted organizational structure to determine who is in charge of recommending and deciding on what retirement benefits to offer those outside the executive suite.
2. When a retirement benefits committee exists, it goes by different names, some of which are listed below.
(a) Master Retirement Committee
(b) Trust Selection Committee
(c) Saving and Investment Plan Committee
(d) Pension Committee
(e) Retirement Board
(f) Fiduciary Committee
(g) Benefits Committee
(h) Deferred Compensation Board
(i) Compensation and Employee Benefits Committee
3. Titles of benefits-related decision-makers vary. Some examples follow.
(a) 401K Board Chairperson
(b) Benefits Director
(c) Benefits and Compensation Director
(d) Benefits Administrator
(e) Head of Human Resources
(f) Compensation Committee Chairperson
4. The SEC has proposed a significant overhaul of reporting rules as relates to executive compensation and compensation committees. It appears to be silent with respect to the compensation decision-making process for employees below C-level.
5. Page 1 of Form 5500 requires the identification of the plan sponsor and plan administrator, respectively. Schedule P to Form 5500 requires the signature of a fiduciary and the name of a trustee or custodian. (According to the U.S. Department of Labor website: “Each year, pension and welfare benefit plans generally are required to file an annual return/report regarding their financial condition, investments, and operations. The annual reporting requirement is generally satisfied by filing the Form 5500 Annual Return/Report of Employee Benefit Plan and any required attachments.”)
6. ERISA mandates the distribution of a Summary Plan Description(SPD) to each plan participant and beneficiary currently receiving benefits.Required information includes “the name, title and address of the principal place of business of each trustee of the plan”. Education and experience are not mandatory disclosure items.
The bottom line is that a systematic identification of who does what and why with respect to employee benefits is simply not a reality as things stand today. This makes it difficult (perhaps impossible) to effect change.
Hunting for treasure shouldn’t be this hard!