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Workplace Issues Today: Businesses seek relief from weighty pension requirements

Many large businesses and trade organizations are asking the government to grant temporary relief from pension fund rules requiring large company contributions. The Pension Protection Act of 2006 was designed to safeguard employee pensions, but has had the added effect of an unusually large burden on firms strapped for cash amid the global financial slowdown. Many companies are concerned about meeting payroll and business needs due to requirements related to pension fund “funded ratios.” In particular, rules specify a 100% funded ratio ($1 for every $1 guaranteed benefit) within 7 years. The falling stock market has pushed next year’s required contributions to enormous highs in order to maintain compulsory ratios. Lawmakers are considering the request.

See “After Losses, Pensions Ask For a Change,” by Mary Williams Walsh, The New York Times, Nov 20 2008 (KBT)

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