Legislation to create an Office of Pension Participant Advocacy within the Labor Department was introduced today by Sen. Tom Harkin, D-Iowa. The office would help participants understand their legal rights and navigate complicated pension laws. It would focus attention on employer practices and loopholes in federal pension law that need to be blocked.
Mr. Harkin, a member of the Senate Health, Education, Labor and Pensions Committee, also introduced a second bill to close a loophole in current law that enables companies to escape paying their share of early retirement benefits if they sell or close a division. Under current law, workers are entitled to a share of an early retirement subsidy they have already earned when employers amend their pension plans. But companies are not required to provide that early retirement subsidy to participants in divisions or businesses they merge or divest. Mr. Harkin's legislation would require companies to apply the same credits toward pensions in mergers and acquisition activities that they do under any other kind of pension plan amendment.
"Increasingly, pension-loss horror stories are emerging in the wake major corporate bankruptcies like Enron and WorldCom. People have lost their guaranteed pensions to mergers and acquisitions, to misinformation, and to just plain irresponsibility on the part of their employer," Mr. Harkin said in a statement.
