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Compliance August 31, 2006
PBGC Issues Updates on Participant Notices
August 31, 2006 (PLANSPONSOR.com) - The Pension
Benefit Guaranty Corporation (PBGC) has issued explanations
on how the Pension Protection Act (PPA) affects how employers
decide if a Participant Notice is required.
Reported by Adrien Martin
The PBGC has released an updated Model Participant Notice (Update 06-3) for plan administrators, who are required by the Employee Retirement Income Security Act (ERISA) to let participants know the PBGC’s funding status and limits with regard to the plan. The agency republishes the document each year to reflect the latest information on maximum guaranteed benefits. The update also includes a worksheet to help administrators figure out if they need to issue a 2006 notice.
According to the notice, under the PPA (See What’s Inside the Pension Protection Act), the ERISA section that requires the notice is repealed for plan years beginning after December 31, 2006, and replaced by new disclosure mandates.
The notice ( Update 06-4) released by the PBGC explains how the provision in the Act relating to the PBGC’s required interest rate for determining variable-rate premiums applies to certain PBGC mandates, particularly in reporting and disclosure.