Benefits April 22, 2002

Audit Reveals Irregularities in Milwaukee Pensions

April 22, 2002 (PLANSPONSOR.com) - A county audit revealed the final cost of pension and wage payments for Milwaukee County employees to be more than five times higher than suggested by fiscal notes originally put forward by administration officials, a report by Milwaukee County's Department of Audit revealed.
Reported by

A perfunctory glance at documents tallying the costs may have lead officials to put the figure at $22.2 million. However, the county’s audit team, an independent arm of the County Board, found that many of the fiscal documents omitted significant pieces of information and were “practically bereft of detail costs.”

In one serious miscalculation, administration officials failed to compound the cost of the compensation deal over the four years, greatly understating its cost, auditors found.

Never miss a story — sign up for PLANSPONSOR newsletters to keep up on the latest retirement plan benefits news.

Final estimates of the cost ended up at around $112 million for the period of 2001 to 2004. The total would cover:

  • increases in wages,
  • changes in pension and sick pay, 
  • modifications to health care, and 
  • additional vacation and holiday benefits.

Pension Scheme

The report, some say, is one more nail in the coffin for County Executive Thomas Ament’s political career, providing further evidence that he sought to enrich himself at the expense of the tax payer  (See also Pumped Pension Payouts Prompt Resignations ). According to press reports, instead of granting pay increases to 5,000 Milwaukee county workers last year, Ament opted to make its pension plan more generous.

Under the new rules:

  • employees, who had worked past their retirement dates, could collect retirement benefits retroactively, and
  • employees could claim a larger share of their unused sick time at retirement.

The new rules ensured Ament, who became eligible to retire in 1996, would receive a lump sum payment of $2.3 million, while several other officials would receive payments of $1 million or more.

In February this year, many of the provisions of the controversial package were trimmed back by the county board at the height of the scandal.

Audit Notes

County auditors describe the pension changes as more generous, especially in its lump sum payment provisions, than similar US public plans, and placed “overall responsibility” for the fiscal information on the plan with the Department of Human Resources, headed up by Gary Dobbert, who, according to reports, failed to share the information with other county finance officials.

Dobbert, who stepped down in January under pressure from the County Board, comes under repeated criticism in the audit (see Petitions Delivered in Milwaukee Controversy and Milwaukee County Exec Steps Down ). Ament and three other officials resigned at the same time.

Benefits April 19, 2002

Companies Continue to Offer Plethora of Perks

April 19, 2002 (PLANSPONSOR.com) - Although fewer and fewer companies are offering traditional pension plans in their benefits packages, they're still filling their benefits bags with a host of other goodies, despite difficult economic times, a new survey by the Society for Human Resource Management (SHRM) revealed.
Reported by

Only 38% of responding companies said that they still offer a defined benefit retirement plan, compared to 75% who now offer a defined contribution plan.

In terms of other financial benefits, the survey found that

Never miss a story — sign up for PLANSPONSOR newsletters to keep up on the latest retirement plan benefits news.

  • 61% of responding companies offer incentive bonus plans, and
  • 53% said they offered new-hire referral bonuses

However, the number of organizations offering educational assistance fell from 88% in 1998 to 79% in the current survey, and career counseling programs fell from 32% to 29% over the past year. Still, professional development opportunities remain popular with approximately 94% of organizations offering these benefits for the last five years.

Healthy Companies

Despite rapidly rising health care costs, the survey results showed that 99% of respondents’ organizations offer some type of health insurance coverage.

Among the more controversial health benefits:

  • 70% provide health plans that cover contraceptives
  • 40% cover infertility treatment
  • 12% pay for grief recovery programs
  • 12% cover support groups

The survey also revealed that coverage of the following health care benefits has decreased:

  • mental health insurance, down from 84% to 76% in five years
  • on-site vaccinations, from 66% to 61% in the past two years, and 
  • retiree health care benefits, which has fallen from 39% to 31% in the past three years.

Balancing Trick

The latest SHRM survey showed that companies are becoming increasingly family-friendly, offering a plethora of work-life balance benefits:

  • 64% reporting they offer flextime
  • 41% of organizations offering some form of telecommuting, and 
  • 33% offered compressed workweeks

Children Welcome

In addition

  • 20% offer child care referral services,
  • 9% offer emergency/sick care,
  • 7% even have a summer camp
  • 6% offer on-site child care,
  • 6% offer foster care assistance
  • 5% each have company supported or subsidized child care
  • 4% have before or after school care,
  • while only 1% offer around the clock child care.

SHRM’s annual survey was e-mailed to 2,423 randomly selected SHRM members who were asked which of a list of 187 benefits their companies offered. Some 551 SHRM members responded.


 

«