The ERISA Industry Committee wants to stop the Treasury Department from proposing regulations on cash balance plans that could "subject many ERIC companies to increased litigation as well as restrict plan design options, according to a memo sent to members following ERICs Oct. 24 board meeting. The group believes the Treasury proposal would prohibit wearaways, a period of time in which employees earn no new pension benefits after their employers convert from traditional defined benefit plans to cash balance plans.
The association intends to lobby Treasury Department officials on the proposed regulation. "We expect to go there and tell them what we think ought to be in the regulations, said Mark J. Ugoretz, president of ERIC. Bill Sweetnam, Treasury benefits tax counsel, could not be reached for comment. The regulator is expected to issue guidance on cash balance plans by early 2002.