H.R.9701 - Retirement Income Security for Employees Act93rd Congress (1973-1974)
|Sponsor:||Rep. Annunzio, Frank [D-IL-11] (Introduced 07/31/1973)|
|Committees:||House - Education and Labor|
|Latest Action:||House - 07/31/1973 Referred to House Committee on Education and Labor. (All Actions)|
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Summary: H.R.9701 — 93rd Congress (1973-1974)All Information (Except Text)
Introduced in House (07/31/1973)
Retirement Income Security for Employees Act - Declares it to be the policy of this Act to protect interstate commerce, and the equitable interests of participants in private pension plans and their beneficiaries, by improving the scope, administration and operation of such plans, by requiring pension plans to vest benefits in employees after equitable periods of service, by establishing minimum standards of fiduciary conduct, and by providing more appropriate and adequate remedies, sanctions, and ready access to the courts.
Sets forth definitions of terms used in this Act.
Title I: Organization - Provides that the Secretary of Labor shall have the responsibility to promote programs and plans for the establishment, administration, and operation of employee benefit plans. Requires the registration of such plans with the Secretary upon compliance with requirements set forth in this title.
Authorizes the Secretary to undertake appropriate studies relating to pension and profit-sharing-retirement plans. Requires the Secretary to submit an annual report to Congress covering his activities under this Act.
Authorizes to be appropriated such sums as may be necessary to enable the Secretary to carry out his duties under this Act.
Provides that within the Department of Labor, there shall be an Office of Pension and Welfare Plan Adminstration to be headed by an Assistant Secretary of Labor, appointed by the President, with Senate advice and consent, to exercise power and authority delegated the Secretary of Labor for the administration and enforcement of the Act.
States that, unless exempt, the provisions of this Act apply to any pension or profit-sharing-retirement plan established or maintained by an employer, a union, or both together in any industry or activity affecting interstate commerce.
Provides that this Act shall not apply to plans administered by Federal or State governments, plans administered by religious organizations, plans for the self-employed, plans covering not more than 25 participants, plans established outside the territorial jurisdiction of the United States for citizens of other countries, certain plans for key executives and plans for members of labor organizations which are financed exclusively from the members' dues.
Provides that the Secretary shall require by regulation that each plan furnish a vested participant, upon his termination of service with the plan, with a certificate reciting the benefits due the participant and the location of the entity responsible for payment and the date when payment shall begin.
Title II: Vesting and Funding Requirements - States that pension or profit-sharing-retirement plans may require as a condition for eligibility in the plan a period of service longer than 12 months or an age greater than 21, whichever occurs later.
Requires all pension and profit-sharing-retirement plans to vest rights in participants with respect to service on or after the effective date of the title at the rate of a 30 percent vested interest commencing with eight years of service, and increasing by 10 percent each year thereafter in order that 100 percent vesting is attained after 15 years of service.
Provides that no more than three of the eight years required to qualify for a 30 percent vested right need be continuous years of service, but that service prior to the age of 21 may be ignored in determing eligibility for a vested right unless the participant or his employer has made contributions to the plan with respect to service prior to age 21.
Provides that every pension plan filed for registration under this Act shall provide for funding, in accordance with the provisions of this title, which is adequate to provide for payment of all pension benefits which may be payable under the terms of the plan. Requires such plans to be received every five years by certified actuaries.
Requires all funds of terminated pension plans to be distributed as follows: (1) first, to retirees or persons eligible to retire on the date of plan termination; (2) to participants who have vested rights under the plan but who have not reached retirement age; and (3) to other participants.
Provides that an existing plan subject to this title may elect, pursuant to regulations, to divide the plan and its trust into two separate plans and trusts or within the same plan and trust, into two separate plan and trust accounts as follows: (1) the continuing plan or plan and trust account which shall be a continuation of the plan as it existed immediately before the effective date of this title and which shall cover those participants who have credited service under such plan as of such date and who elect to remain covered by the provisions of such plan; and (2) the new plan or new plan and trust account which shall cover all new participants and all participants who would be eligible to continue coverage under the continuing plan but who elect to waive such coverage and to participate instead in the new plan.
Authorizes the Secretary to grant an initial delay of up to three years to comply with the vesting or funding requirements of the Act where initial compliance with these requirements would be unduly burdensome, impractical, or would otherwise adversely affect the interests of employees.
States that upon a showing that an employer cannot make the required annual contribution to the plan, the Secretary is authorized to permit the deficiency to be funded over a period of five years, provided that the Secretary is satisfied that such a waiver will not adversely affect the interests of employees and will not impair the financial position of the plan termination insurance fund.
Title III: Voluntary Portability Program for Vested Pensions - Establishes a voluntary program for protability of vested pension credits. Provides that the program will be administered by and under the Secretary's direction and designed to facilitate the voluntary transfer of vested credits between registered plans. States that plans registered under the Act may voluntarily apply for membership in the program and upon approval be issued a certificate of membership by the Secretary.
Establishes a Voluntary Portability Program Fund under the supervision of the Secretary into which payments will be made in accordance with regulations prescribed by the Secretary under the portability program. Provides that the Secretary shall be the trustee of the fund, and shall administer the fund and report to the Congress annually on the fund's operations and fiscal status.
Title IV: Plan Termination Insurance - Establishes the 'Private Pension Plan Termination Insurance Program' which shall be administered by and under the direction of the Secretary. Provides that such program shall insure participants in a plan against losses of vested benefits arising from plan termination. States that the coverage under such program is limited to 50 percent of the highest monthly wage of a participant earned over a five yar period or $500 per month.
Provides that upon registration with the Secretary, each plan shall pay a uniform assessment to the insurance program to cover the administrative costs of such program. States that no plan insured under this title shall terminate without approval of the Secretary. Provides that where employers in terminated plans are not insolvent, such employers shall be liable to reimburse the insurance program to the extent provided under this title.
Creates the Pension Benefit Insurance Fund which shall be available without fiscal year limitation for the purposes of this title.
Title V: Disclosure and Fudiciary Standards - Provides that annual reports required by the Welfare and Pension Plans Disclosure Act shall be accompanied by a certificate designating the Secretary as agent for service of process in any action arising under this Act. States that plan descriptions under the Welfare and Pension Plans Disclosure Act shall be comprehensive and written in a manner calculated to be understood by the average participant. Sets forth provisions which a plan's annual financial report shall include.
States that the administrator of any employee benefit plan subject to such Act shall file a copy of the plan description and each annual report with the Secretary. Provides that every three years each participant in the plan shall receive a revised summary of the plan's important provisions and major amendments thereto.
Expands the Advisory Council on Employee Welfare and Pension Benefit Plans to 21 members (now 13) and adds as permanent categories of membership the fields of actuarial counseling, investment counseling and accounting.
Provides that every employee benefit funds established to provide for the payment of benefits shall be established pursuant to a duly executed trust agreement which shall set forth the purpose or purposes for which such fund is established and the detailed basis on which payments are to be made into and out of such fund. States that such fund shall be deemed a trust for the exclusive purpose of (1) providing benefits to participants in the plan and their beneficiaries and (2) defraying reasonable expenses of administering the plan.
Provides that a fiduciary shall discharge his duties with respect to the fund: (1) with the care under the circumstances then prevailing that a prudent man acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims; and (2) in accordance with the documents and instruments governing the fund insofar as is consistent with this Act.
Sets forth in detail the restrictions on and the extent of the obligations, responsibilities and duties of a fiduciary under this Act.
Title VI: Enforcement - Empowers the Secretary to petition any district court of the United States having jurisdiction to require a pension or profit-sharing plan to comply with the requirements of this Act or to recover the payment of required monies. Provides that civil actions by plan participants against violations of the fiduciary requirements of this Act may be instituted in Federal or State courts. Allows a fiduciary or administrator of a plan to obtain judicial review of the actions of the Secretary.
Declares to be the express intent of Congress the the provisions of this Act or the Welfare and Pension Plans Disclosure Act shall supersede any and all laws of the States and of political subdivisions thereof insofar as they may now or hereafter relate to the subject matters regulated by this Act or the Welfare and Pension Plans Disclosure Act.
States that nothing in this Act shall be construed to: (1) exempt or relieve any employee benefit plan not subject to this Act or the Welfare and Pension Plans Disclosure Act from any law of any State which regulates insurance, banking, or securities or to prohibit a State from requiring that there be filed with a State agency copies of reports required by this Act to be filed with the Secretary; or (3) alter, amend, modify, invalidate, impair, or supersede any law of the United States other than the Welfare and Pension Plans Disclosure Act or any rule or regulation issued under any law except as specifically provided in this Act.
Title VII: Effective Dates - Sets forth the effective dates of the provisions of this Act.