Category Archives: Employee Benefits & Executive Compensation

Subscribe to Employee Benefits & Executive Compensation RSS Feed

Proposed Regulations Would Permit Employers to Reimburse an Employee’s Premium Costs for a Health Insurance Policy Purchased in the Individual Market

regulations
Takeaway Message: Except in limited circumstances, current regulatory guidance prohibits an employer from maintaining a health reimbursement arrangement (HRA) that reimburses the cost of premiums for individual health insurance policies purchased by employees in the individual market. Proposed regulations (found here) aim to eliminate this prohibition, if certain conditions are met.… Continue reading this entry

Check Your COBRA Notices in Order to Avoid Potential Lawsuits

COBRA
Have you thought about your COBRA notices recently? Of course not, because COBRA notices don’t warrant your valuable time. They are just another one of those pesky notices that the law requires you to send. If that was your reaction, you may want to rethink it.… Continue reading this entry

Incentive Compensation That is Never Subject to Income Tax – Too Good to Be True?

Incentive
Clients frequently ask if they can provide incentive compensation to their employees and executives in a manner that gives them flexibility and drives performance, but receives coveted capital gains treatment. This usually sounds too good to be true. In most cases, you can defer or sometimes minimize income tax for employees (retirement plans, deferred compensation … Continue reading this entry

Non-Qualified Retirement Plans & Divorce: You May be Able to Honor DROs, But Should You?

Honor
You probably already know that employers are required to honor qualified domestic relations orders (commonly referred to as “QDROs”) regarding the division of qualified retirement plan benefits (such as 401(k) balances) when an employee gets divorced. However, many employers mistakenly assume that they must also honor domestic relations orders (“DROs”) related to nonqualified retirement plans … Continue reading this entry

A New Way to Use Your 401(k) Plan to Attract and Retain Recent Graduates

401(k)
According to a recent report, the average student loan debt for a Class of 2016 graduate is $37,172. As recent graduates enter the work force, they often choose not to contribute to their employers’ 401(k) plans and lose out on corresponding employer match because they prefer to focus on paying off their student loans or … Continue reading this entry

How Do I Report Non-Qualified Plan or Severance Payments to a Former Employee? Hint: You Should Probably Use a W-2, Not a 1099!

Payments
Employers commonly make payments to former employees for a number of reasons. Two of the more routine payments are those from a non-qualified deferred compensation plan (such as payments from a supplemental executive retirement plan or a 401(k) restoration-type plan) or pursuant to a severance arrangement, and sometimes both. (Other termination- or settlement-type payments, such … Continue reading this entry

Looking at an Expanding Landscape: Multiemployer Plan Withdrawal Liability

withdrawal
If an employer withdraws from a multiemployer pension plan such that the employer no longer has an obligation to contribute to the plan, the withdrawing employer is generally responsible for its share of the plan’s underfunding. This is referred to as withdrawal liability. Typically, in the context of an asset sale transaction, the seller is … Continue reading this entry

Details Matter: Medical Plan Anti-Assignment Clauses Protect Employers

regulations
Yes, details matter. This is true on many fronts, including whether the documents governing the medical plan offered to employees prohibit employees and their dependents from assigning their plan benefit rights to a health care provider.… Continue reading this entry

Complying with Hardship Withdrawal Rules Makes Retirement Plan Administration Easy (Well, Easier, Anyway)

Retirement
In a February 2018 article, my colleague Kathleen Dreyfus Bardunias encouraged retirement plan sponsors to implement annual “operational checkups” in order to ensure their plans were administered in compliance with the plan’s terms and applicable law. That article described various retirement plan administration errors that review might uncover, including: failing to timely deposit employee contributions, … Continue reading this entry

What Now for Wellness?

Wellness
If you’re an employer trying to sponsor a wellness program for 2019, then the recent kerfuffle between the AARP and the Equal Employment Opportunity Commission (EEOC) affects you. The AARP has challenged the EEOC’s wellness program regulations on the grounds that the EEOC’s permissible wellness incentive of up to 30 percent of the cost of … Continue reading this entry

Term Limits? Stock Options are Not as Flexible as You May Think…

Termination
Even though stock options are a commonly used compensation tool, certain issues, such as whether you must/should limit their terms and, if you do, whether you can make changes to their terms after they have been granted, still catch some employers by surprise.… Continue reading this entry

April 1, 2018 is Fast Approaching – Are Your Disability Claims Procedures Ready?

Disability
The Department of Labor issued the final disability claims regulations on December 16, 2016. These regulations are effective for all claims filed on or after April 1, 2018. The Department felt the update was needed to provide claimants a full and fair review, to promote fairness and accuracy, and to better protect participants.  The Department … Continue reading this entry

An Annual Retirement Plan “Check-Up” May be Just What the Doctor Ordered!

Retirement
February is Heart Health Month, which always reminds me to schedule my annual doctor checkup. This got me thinking that the need for ongoing “checkups” and maintenance applies not just to our health, but to our homes, cars, and even to your company’s retirement plans!  That’s right—if you work with your employer’s tax-qualified retirement plans, … Continue reading this entry

Unlike Diamonds, You Cannot Presume Retiree Medical Benefits Are Forever

Employer
Last week, the United States Supreme Court issued a decision that gives unionized employers in Michigan, Ohio, Tennessee, and Kentucky greater ability to modify medical benefits they provide to retirees pursuant to current and prior collective bargaining agreements. Employers in these states were previously subject to the unique case law from the United States Court of … Continue reading this entry