Blogging Employee Benefits

November 17, 2006

Waiver of PBGC Premium Penalties

Filed under: PBGC, Regulations — Fuguerre @ 7:45 am

The Pension Benefit Guaranty Corporation has codified it policy guidance on premium penalty waivers as an appendix to its premium payment regulation, effective for PBGC actions taken on or after December 18, 2006. [FR E6-19436]

The PBGC waives the penalty on failure to pay PBGC premiums most often in the case of “reasonable cause,” generally described as facts and circumstances meeting two conditions –

  • Circumstances Beyond Control – The premium payment violation occurs due to circumstances beyond the control of the person on whose action or inaction the penalty assessment may be based; and
  • Ordinary Business Care and Prudence – The violation could not have been avoided by exercising ordinary business care and prudence, taking into account the size of the organization and premium.

Specific situations that might be characterized as reasonable cause include a sudden and unexpected absence of the individual with the responsibility to deal with premium payment, destruction of relevant records because of a casualty or natural disaster, and reasonable reliance on erroneous communication from a PBGC employee. Failure to exercise care in the selection of a company’s advisors, such as its lawyers or actuaries, will not be considered a basis for reasonable cause, whether or not the advisors are employees or outside advisors.

In addition to waivers for reasonable cause, the PBGC may waive premium penalties in various other situations –

  • Statutory or Regulatory Requirement – When a statute or regulation requires the penalty to be waived.
  • Legal Error – When the premium violation arises from reliance on an erroneous legal interpretation or, in appropriate circumstances, from a recent change in the law.
  • PBGC Procedure Pendency – When the violation is attributable to a PBGC review or other procedure is pending.
  • Other Circumstances – When appropriate, in other narrow circumstances.

November 1, 2006

By Any Other Name

Filed under: P&B Blog — Fuguerre @ 6:17 pm

This is not the first time I’ve amended the title of my pensions and benefits weblogging. Except whereas my previous change came on the heels of discovering a non-EB blog that had already been using the name I’d originally given this effort, this time I’m risking blurring lines with one of the best teams in my own field, the new Pension & Benefits Blog recently launched by BNA’s Pension & Benefits Advisory Board, a veritable who’s who of the industry.

Although I’m not a BNA subscriber myself, who with any pension or benefits experience at all is ignorant of the subscription service Pension & Benefits Reporter, along with its companion Pension & Benefits Daily? So even before BNA’s new blog, I was not at all comfortable with the replacement name I’d settled on as a temporary placeholder here. But now that BNA’s brought us this new blog – and a great one at that – it’s simply too inappropriate for me to carry on calling this what I’d been calling it. More than once now, and in more than one place, I’ve seen the names of our respective efforts unnecessarily confused.

And yes, despite researching this all yet again for the past several weeks since BNA’s blog was launched, somehow I do suspect that it’s a matter of time before I feel compelled to rename this yet again. Out of several dozen alternatives I won’t bother reciting here, at first I began settling on the simpler “Blogging Benefits,” but there are already too many articles where that title seems more connected with the concept of the advantages, usually to a business enterprise, of maintaining a blog (which I imagine BNA themselves might already be tuning into). As I suggested before, I’m a whole lot more creative with QDRO design than I am with weblog titles. But such as it is and for what it’s worth, from here on through to the next name, we’re “Blogging Employee Benefits.”

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