New pension guidelines not as onerous as first proposed

But plan sponsors must ensure they are taking an active role in the operation and oversight of plans and in the information communicated to members
By Lori Satov
|hrreporter.com|Last Updated: 09/06/2005

The release of the final version of the Joint Forum of Financial Market Regulators Guidelines for capital accumulation plans is as exciting to the pension industry as Christmas morning is to a child.

The anticipation had created a nervous anxiety amongst plan sponsors and service providers alike. What onerous liability would the guidelines impose? How must they be carried out? What sort of implementation time frame would be required? What would it cost? And, most importantly, what would be the impact of non-compliance on a plan sponsor’s ultimate liability?

The final guidelines are not as onerous as the initial proposed guidelines released in April of 2001 nor the follow-up revised draft guidelines proposed in January 2003. The underlying message, however, is the same: plan sponsors must ensure that, as fiduciaries, they are taking an active role in the operation and oversight of their plan and in the information communicated and provided to members.