Prepared statements, letters, supplemental material, etc.-Continued Esch, Hon. Marvin L., a Representative in Congress from the State of Report General Accounting Office__ "Use of Pension Funds by Persons Associated With Organized Crime," an article published in the Congressional Record.. Greenough, William C., chairman, Teachers Insurance and Annuity Haddock, Hoyt S., executive director, AFL-CIO Maritime Com- Impellizeri, Mario E., pension consultant and cofounder, the Pension Kleiler, Frank M., Director, Office of Labor-Management and Welfare- Pension Reports, U.S. Department of Labor, "Summary of Report on Canadian Regulation of Pension Plans". Lackman, William F., senior pension adviser, Morgan Guaranty Lumb, H. C., vice president, corporate relations and public affairs, 119 430 892 799 U.S. Department of Labor, letter to Chairman Dent, dated April 20, 1970, enclosing letter to Senator Harrison A. Williams, Jr.. 327 National Society of Professional Engineers, statement of 199 281 Reid, Hon. Ogden R., a Representative in Congress from the State of "Explanatory Notes Concerning Principal Provisions of the Pension and Employee Benefit Act," an article published in the Letter to Chairman Dent, dated December 9, 1969- Sheinkman, Jacob, vice president and general counsel, Amalgamated Clothing Workers of America, letter to Chairman Dent, dated April Statement on Use of Private Welfare and Pension Funds for 529 "Pensions at United States Steel," supplementary statement B "Projection of Withdrawals, United States Steel Corp.," sup- Van Deuren, Richard A., president, the Association of Private Pension 157 Willis, E. S., manager, Employee Benefits, General Electric Co.: Progress in providing private pensions (chart) -- 535 533 American Life Convention, Health Convention, Health Insurance Associa- tion of America, and Life Insurance Association of America, statement of Calvin, Donald L., vice president, New York Stock Exchange, letter to Chairman Dent, dated December 10, 1969, enclosing statement. Chandler, Charles R., assistant manager, Michigan Bankers Association, Lansing, Mich., letter to Chairman Dent, dated June 12, 1970____ Cook, Mr. and Mrs. Edw. J., Utica, Mich., letter to Congressman O'Hara, Coulthart, G. W., manager, Personnel Relations Department, American Letter to Hon. Earl Landgrebe, a Representative in Congress from the "Recommended Revisions in H.R. 16462," an article entitled.. Coury, George J., Taunton, Mass., letter to Chairman Dent, dated 942 943 Erlenborn, Hon. John N., a Representative in Congress from the State of 944 Gillespie, Raymond B., Long Beach, Calif., letter to Congressman Hosmer, Hathaway, C. N., vice president, Caterpillar Tractor Co., Peoria, Ill., Nunn, Ira H., Washington counsel, National Restaurant Association, letter Padegs, Juris, Committee on Legislation, Investment Counsel Association of America, Inc., New York, N. Y., letter to General Subcommittee on Savoie, Leonard M., executive vice president, American Institutes of Certified Accountants, New York, N.Y., letter to Chairman Dent, PRIVATE WELFARE AND PENSION PLAN LEGISLATION WEDNESDAY, DECEMBER 10, 1969 HOUSE OF REPRESENTATIVES, GENERAL SUBCOMMITTEE ON LABOR OF THE COMMITTEE ON EDUCATION AND LABOR, Washington, D.C. The subcommittee met at 9:30 a.m., pursuant to call, in room 2261, Rayburn House Office Building, Hon. John H. Dent (chairman of the subcommittee) presiding. Present: Representatives Dent, Pucinski, Bell, Erlenborn, Esch, and Landgrebe. Staff members present: S. G. Lippman, subcommittee counsel; Adrienne Fields, subcommittee clerk; and Michael Bernstein, minority counsel. (Text of H.R. 16462 follows:) [H.R. 16462, 91st Cong., second sess.] A BILL To amend the Welfare and Pension Plans Disclosure Act Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That, in order to strengthen and improve the protection of participants in and beneficiaries of employee welfare and pension benefit plans under the Welfare and Pension Plans Disclosure Act of August 28, 1958, as amended (92 Stat. 997), such Act is amended as follows: SECTION 1. SHORT TITLE. Immediately following the table of contents of such Act is added the title "SHORT TITLE", and the following paragraph: "SECTION 1. This Act may be cited as the 'Employee Benefits Protection Act'." SEC. 2. (a) The title of section 2 of such Act is amended by adding the words "declaration of" after the word "and". (b) Subsection (a) of section 2 of such Act im amended by striking out the words "welfare and pension", and by adding the words "that the operational scope and economic impact of such plans is increasingly interstate;" after the word "substantial;", adding the words "and adequate safeguards" after the word "information", and adding the words "and safeguards be provided" after the word "made". (c) Section 2(b) is amended by striking out the period at its end and inserting in lieu thereof a comma followed by the words "by establishing fiduciary standards of conduct, responsibility, and obligation upon all persons who exercise any powers of control, management, or disposition with respect to employee benefit funds or have authority or responsibility to do so, and by providing for appropriate remedies and ready access to the Federal courts." SEC. 3 (a) Subsections 1 through 13 of section 3 of such Act are redesignated by striking out the numbers "1" through "13" and inserting in lieu thereof by the letters "a" through "m" respectively. (b) Sections 3 (a) and (b) are amended by inserting the words "or maintained" after the word "established" in both subsections. (c) Sections 3 (c), (d), (f), and (g) are amended by striking out the words "welfare or pension" where they appear in each subsection respectively. (d) Section 3 (m) is amended to read as follows: "(m) The term 'party in interest' means any administrator, officer, trustee, custodian, counsel, or employee of any employee benefit plan, or a person providing benefit plan services to any such plan, or an employer any of whose (1) employees are covered by such a plan or any person controlling, controlled by, or under common control with, such employer or officer or employee or agent of such employer or such person, or and employee organization having members covered by such plan, or an officer or employee or agent of such an employee organization, or a relative, partner, or joint venturer of any of the above described persons." (e) Section 3 is further amended by adding subsections "n" through "x", to read as follows: "(n) The term 'relative' means a spouse, ancestor, descendant, brother, sister, son-in-law, daughter-in-law, father-in-law, mother-in-law, brother-in-law, or sister-in-law. "(o) The term 'administrator' means "(1) the person specifically so designated by the terms of the plan, collective bargaining agreement, trust agreement, contract, or other instrument, under which the plan is operated; or "(2) in the absence of such designation (A) the employer in the case of an employee benefit plan established or maintained by a single employer, (B) the employee organization in the case of a plan established or maintained by an employee organization, or (C) the association, committee, joint board of trustees, or other similar group of representatives of the parties who established or maintain the plan, in the case of a plan established or maintained by two or more employers or jointly by one or more employers and one or more employee organizations. "(p) The term 'employee benefit plan' or 'plan' means an employee welfare benefit plan or an employee pension benefit plan or a plan providing both welfare and pension benefits. "(q) The term 'employee benefit fund' or 'fund' means a fund of money or other assets maintained pursuant to or in connection with an employee benefit plan and includes employee contributions withheld but not yet paid to the plan by the employer. The term does not include: (1) any assets of an investment company subject to regulation under the Investment Company Act of 1940; (2) premiums, subscription charges, or deposits received and retained by an insurance carrier or service or other organization, except for any separate account established or maintained by an insurance carrier. "(r) The term 'separate account' means an account established or maintained by an insurance company under which income, gains, and losses, whether or not realized, from assets allocated to such account, are, in accordance with the applicable contract, credited to or charged against such account without regard to other income, gains, or losses of the insurance company. "(s) The term 'adequate consideration' when used in section 14 means either (1) at the price of the security prevailing on a national securities exchange which is registered with the Securities and Exchange Commission, or (2) if the security is not traded on such a national securities exchange, at a price not less favorable to the fund than the offering price for the security as established by the current bid and asked prices quoted by persons independent of the issuer. "(t) The term 'nonforfeitable pension benefit' means an immediate or deferred pension or other benefit which a participant or his beneficiary would upon proper application be entitled to receive under the provisions of the plan if at the time in question he had terminated his employment, irrespective of any conditions subsequent which could affect receipt of such benefit. "(u) The term 'accrued benefit' means that benefit which, irrespective of whether such benefit is nonforfeitable, is equal to: (1) in the case of a profit sharing or money purchase type pension plan, the total amount credited to the account of a participant; (2) in the case of a unit benefit type pension plan, the benefit units credited to a participant; or (3) in the case of other types of pension plans, that portion of the prospective benefit of a participant of the plan as the Secretary may by rule or regulation provide constitutes the participant's accrued benefit under the plan. "(v) The term 'security' has the same meaning as in the Securities Act of 1933 (15 U.S.C. 77(a) et seq.). "(w) The term 'fiduciary' means any person who exercises any power of control, management. or disposition with respect to any moneys or other property of an employee benefit fund, or has authority or responsibility to do so. "(x) The term 'market value' or 'value' when used in this Act means fair market value where available, and otherwise the fair value as determined in good faith by the administrator." SEC. 4. (a) Subsection (a) of section 4 of such Act is amended by striking out the words “welfare or pension", "or employers", and "or organizations". (b) Section 4(b) is amended by striking out the words "welfare or pension", and is further amended in paragraph (3) thereof by adding the letter designation "(A)" after the word "administered" the second time it appears, adding a comma after the word "society" the first time it appears, followed by the words "order or association", adding the letter designation "(B)" after the word "or" the first time it appears, striking out the word "and" the second time it appears and adding in lieu thereof the word "or", and by adding a comma after the word "society" the second time it appears, followed by the words "order, association". (c) Paragraph (4) of section 4(b) is amended by striking out the period at its end and adding in lieu thereof a comma, followed by the words "except that participants and beneficiaries of such plan shall be entitled to maintain an action to recover benefits or to clarify their rights to future benefits as provided in section 9(e) (1) (B).”. SEC. 5. (a) Subsection (a) of section 5 of such Act is amended to read as follows: "(a) The admiinistrator of an employee benefit plan shall cause to be published in accordance with section 8 to each participant or beneficiary covered thereunder (1) a description of the plan and (2) an annual financial report. Such description and such report shall contain the information required by sections 6 and 7 of this Act in such form and detail as the Secretary shall prescribe and shall be executed, published, and filed in accordance with the provisions of this Act and regulations of the Secretary." (b) Section 5(b) is amended, and section 5(c) added, to read as follows: "(b) The Secretary may require the filing of special terminal reports on behalf of an employee benefit plan which is winding up its affairs, so long as money or other assets remain in the plan. Such reports may be required to be filed regardless of the number of participants remaining in the plan and shall be on such forms and filed in such manner as the Secretary may by regulation prescribe. "(c) The Secretary may by regulation provide for the exemption from all or part of the reporting and disclosure requirements of this Act of any class or type of employee benefit plans, if the Secretary finds that the application of such requirements to such plans is not required in order to effectuate the purposes of this Act." SEC. 6. Section 6 of such Act is amended to read as follows: "(a) A description of any employee benefit plan shall be published as required herein within ninety days after the establishment of such plan or when such plan becomes subject to this Act. "(b) The description of the plan shall be comprehensive and shall include the name and type of administration of the plan; the name and address of the administrator; the schedule of benefits; a description of the provisions providing for nonforfeitable pension benefits (if the plan so provides) written in a manner calculated to be understood by the average participant, and if the plan does not provide such benefits, a statement to this effect: the source of the financing of the plan and the identity of any organization through which benefits are provided; whether records of the plan are kept on a calendar year basis, or on a policy or other fiscal year basis, and if on the latter basis, the date of the end of such policy or fiscal year; the procedures to be followed in presenting claims for benefits under the plan and the remedies available under the plan for the redress of claims which are denied in whole or in part. Amendments to the plan reflecting changes in the data and information included in the original plan, other than data and information also required to be included in annual reports under section 7, shall be included in the description on and after the effective date of such amendments. Any change in the information required by this subsection shall be reported in accordance with regulations prescribed by the Secretary." SEC. 7. (a) Subsection (a) of section 7 of such Act is amended by adding the number "(1)" after the letter "(a)", and by striking out that part of the first sentence which precedes the word "if" the first time it appears and inserting in lieu thereof the words "An annual report shall be published with |