Benefits November 11, 2003

DoL Reminds Employers of Soldier-Rehire Law after Complaints Rise

November 11, 2003 (PLANSPONSOR.com) - US Department of Labor (DoL) Secretary Elaine Chao has released a new public service announcement reminding employers that they have to reinstate mobilized reservists and National Guard members called to active duty.
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Chao’s reminder was in response to a flood of complaints from about 1,300 National Guardsmen and reservists that they ran into roadblocks getting their old job back after getting home, the Washington Post reported. “They did their job — now let’s do ours,” Chao says in the announcement (See http://www.dol.gov/vets/userra-video/ ). The complaint total for the fiscal year ending September 30 represented a whopping 44% increase over 2001’s total of 900. The Post said it couldn’t be learned how many of the latest complaints came from military personnel returning from Iraq.

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In about one-third of the cases filed in the past year, reserve and guard personnel said they missed out on jobs and promotions as a result of their mobilization, and about 20% said they weren’t reinstated in their jobs. The rest of the cases involved vacation, seniority and pension issues, DoL officials said.

The department referred 79 of the cases to the Department of Justice for possible civil prosecution. A Justice Department spokesman said the department couldn’t determine whether any lawsuits have resulted from the recent complaints. The US attorney in Denver has filed two lawsuits on behalf of National Guard and reserve forces in the past six months, the Post said.

For the most part, employers across the country have been generous in dealing with their National Guard and reserve employees, officials said. Hundreds of firms have begun making up the pay difference between their military and civilian pay, according to Employer Support of the Guard and Reserve, and many offer health benefits as well.

Under a 1994 law, The Uniformed Services Employment & Reemployment Rights Act (USERRA), it is illegal to discriminate against military personnel mobilized for duty. Returning personnel are supposed to be allowed to return to their same, or a comparable job, complete with any pay raises or promotions they might have otherwise received if they had remained at work.

Compliance November 10, 2003

SEC Fills in Sarbanes-Oxley Details

October 23, 2002 (PLANSPONSOR.com) - Congress may have laid out general reform measures to deal with the corporate world's financial scandals, but it is up to the US Securities and Exchange Commission (SEC) to fill in the details.
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That’s why SEC officials have scheduled two meetings for October 30 and October 31 to further consider proposals mandated by the Sarbanes-Oxley Act of 2002 passed as part of a sweeping corporate accounting reform, according to a Dow Jones news report.

In the October 30 session, the SEC will consider proposing rules for the use of pro forma financial information in company earnings reports. It will also consider a rule to require companies to discuss off-balance sheet arrangements in their Management’s Discussion and Analysis section in annual and quarterly reports.

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Under the new rules, companies may be required to provide a table of contractual obligations due in the short and long run, and either a table or text disclosure of total contingent liabilities and commitments in the short and long-term, the Dow Jones story reported.

Also scheduled for October 30, the SEC will look into rules that would prohibit a company’s directors and executives from purchasing, selling, or otherwise transferring any equity securities of the company during a pension plan blackout period in which line employees are also prohibited from making equity transactions in company stock, Dow Jones said.

This rule would also require companies to provide advanced notice of pension plan blackout periods.

New Attorney Standards

The next day, the SEC said it would consider rules establishing standards of professional conduct for attorneys who represent companies before the commission.

These standards would include a rule requiring an attorney to report evidence of a material violation of securities laws or breach of fiduciary duty by the company or its officers to the chief legal counsel or the chief executive officer of the company, the SEC said.

If these executives don’t respond appropriately, the attorney may be required to report the evidence to the audit committee, another committee of independent directors or the full board of directors, Dow Jones said.

Finally, the SEC will look into changing the definition of terms used in the definition of dealer for banks under certain securities laws. These proposals relate to the implementation of the specific exceptions for banks from the definitions of “broker” and “dealer” that were amended by the Gramm-Leach-Bliley Act, the SEC said.

On October 16, the SEC proposed new rules to  strengthen corporate controls and ethics .

According to the Dow Jones story, those proposals would require companies to designate a financial expert on their corporate boards, adopt internal controls, and disclose whether they have a code of ethics. Another proposed rule would bar corporate executives from coercing, manipulating, or misleading the firm’s auditor.

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