Compliance July 11, 2006

Detroit Cops Lose OT Court Fight

July 11, 2006 (PLANSPONSOR.com) - A federal appellate court agreed with a lower court judge, deciding that a group of police officers did not prove they were due overtime pay for periods when officials from the Wayne County, Michigan, airport required them to wear pagers.
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The 6th US Circuit Court of Appeals and US District Judge Denise Page Hood of the US District Court for the Eastern District of Michigan threw out legal claims by police officers against the Wayne County (Michigan) Airport Authority that asserted that the officers were entitled to overtime pay for any off-duty hours when they were required to wear pagers.

Airport officials also required the officers to stay within a certain geographic area so they could quickly respond to emergencies. The employees were subject to discipline if they failed to respond to a summons.

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Hood not only ruled against the plaintiffs on their overtime claims under the federal Fair Labor Standards Act (FLSA), but she also turned away allegations that airport officials retaliated against the officers for the lawsuit by requesting that they return their pagers, which eliminated compensatory time in favor of overtime.

In a ruling, the court accepted airport officials’ arguments that the test for off-duty compensable time in the area of the country that the 6th Circuit covers decides whether the employer imposed burdens on the employees during off-duty time that were so severe that employees were unable to use their off-duty time for their own pursuits.

A full copy of the court’s opinion can be found here .

Investing July 10, 2006

401(k) Participants Flock to Fixed Income in June

July 10, 2006 (PLANSPONSOR.com) - Participants in 401(k) plans focused much of their transfer activity toward fixed income funds in June, according to Hewitt's 401(k) Index.
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Net transfer activity was fixed-income oriented on 86% of the days during the month – the largest percentage of days in a month since 2003, according to Hewitt.

As the stock market continued its descent in the month, average daily net transfer activity increased to 0.054% of balances (through June 15). Net transfer activity peaked at 0.13% of balances on June 13, Hewitt data showed.

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Participants continued their retreat started in May from international and emerging market equity funds (See Participants End Love Affair with International Funds ). International and emerging market equity funds experienced net outflows of more than a quarter of a billion dollars, or 3.2% of balances, over the month.

Around 21% of transferred balances went into money market funds and almost 76% went into GIC/Stable Value funds in June.

Almost 22% of 401(k) balances were held in GIC/Stable Value funds as of the end of June, while 22.22% were in company stock and 20.68% were in Large US Equity funds.

Large US Equity funds pulled in more new participant contributions than other fund types (23.19%) followed by GIC/Stable Value which pulled in 17.45% of new participant contributions.

The Hewitt data can be viewed here .

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