Benefits April 22, 2011

KRS Puts Staff Salaries Online

April 22, 2011 (PLANSPONSOR.com) – Another public retirement system has brought its salary records online. 

 

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The Kentucky Retirement System (KRS) has posted the salaries of some 250 employees online at the Bluegrass State’s “Open Door” web site (http://opendoor.ky.gov).  The salaries were a source of controversy this month, according to the Lexington Herald-Leader, after KRS refused to disclose them to a state retiree (Eva Smith-Carroll) who requested them under the Kentucky Open Records Act.  KRS had described the request as “unduly burdensome”, and cited a state law shielding certain information about individual pension accounts and said it prohibits disclosure of KRS salaries.   

However, subsequently, Attorney General Jack Conway ruled that KRS — which manages about $13 billion in assets for state and county retirees — had violated the law (see Kentucky AG Orders Release of Retirement System Salaries).

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On April 7, responding to Conway’s ruling and several other recent controversies, the KRS board of trustees voted to replace its longtime chairman, Randy Overstreet, and fire its executive director, Robert Michael Burnside (see KY Retirement System Fires Executive Director). 

The state's Open Door Web site identifies 254 KRS employees, their job titles and their pay.  http://opendoor.ky.gov/search/Pages/SalarySearch.aspx

KRS has its own web site offering transparency into the systems activities, board policies, investment policies, and the like at http://kyret.ky.gov/index.php/about/open

Investment Meeting

At KRS' annual board meeting, Chief Investment Officer TJ Carlson reported a 12.9% return for the Total Pension Fund and a 13.3% return for the Total Insurance Fund for the year ending December 31, 2010, according to an update on the KRS web site.  The Pension Fund outpaced its blended benchmark return by 49 basis points or 0.49% while the Insurance Fund performed in-line with its benchmark, according to

“KRS has a well defined, mature investment program which is being further diversified to help produce the best possible returns within a risk-controlled program” Carlson said.

Benefits April 22, 2011

AP, Union Reach Deal on Pension

April 22, 2011 (PLANSPONSOR.com) - The Associated Press has reached a tentative labor agreement covering about 1,200 newsroom and technology workers after six months of negotiations.

 

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The contract announced today would, according to the Associated Press, freeze a longstanding defined benefit pension plan.  Future retirement contributions would be at least 6% of salary annually, made to a defined contribution account, and the match would be eliminated for union-covered workers (this would allow employees to receive the full contribution whether or not they contributed).  The pension plan’s fate had been a major sticking point in the talks, according to the report.

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In exchange for the freeze, the AP agreed not to increase employees’ health insurance coverage until the contract expires in August 2013. The contract also includes three raises of 1.5% each.

Difficult Talks

AP sought the pension freeze to help lower its costs in the future and make up for a more than $100 million shortfall in the plan.  “These were very difficult talks, covering difficult topics in uncertain economic times,” said Jessica Bruce, the AP’s vice president of human resources in an Associated Press report.  “With this agreement now in place, AP and its staff can now focus their attention and energy on the initiatives critical to driving revenue so that AP can stay competitive and maintain its leadership in the media marketplace.” 

The AP already had stopped offering the traditional pension plan to management employees hired since 2005 and union-covered employees since March 2006. Those newer employees receive 3% of salary in the defined-contribution plan (for union employees, the AP contributes up to 3% of salary to a 401(k)). 

Besides the 6% contribution, employees affected by the pension freeze would get an additional contribution of 1% or 2% of pay to the defined-contribution plan over the next eight years, depending on how long they have been with the company.

The union said the pension freeze would affect about 950 of the 1,200 covered by the new agreement.

The agreement came after the union threatened to file allegations of unfair labor practice and management threatened to withdraw several of its key proposals. 

The union says it hopes to schedule a vote by June 1.

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