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Sure, They Save Money, But Maybe There is a Better Way

Despite government studies showing that pharmacy benefit managers can save employers money on prescription drugs, the PBM industry can’t seem to shake its unsavory reputation. The most recent blow to the troubled industry came in August, when New York State Attorney General Eliot Spitzer sued Express Scripts Inc., alleging that it inflated drug costs to the state’s largest employee health plan. Express Scripts denies the charges, saying it has saved the state $2 billion since 1998. Even before the suit was filed, two other industry leaders, Medco Health Solutions Inc. and Caremark Rx Inc., faced legal troubles of their own. Medco settled two separate suits, requiring it to pay $71.8 million in fines and penalties. Among the accusations by prosecutors: PBMs have inflated the cost of prescription drugs, siphoned off rebates intended for customers and improperly switched patients to more expensive drugs to benefit from manufacturers’ rebates.



    Concerns are filtering down to employers. The HR Policy Association is working with a coalition of 50 large employers on a plan that would bypass benefit managers and set up direct negotiations with manufacturers. A memo outlining their position obtained by Workforce Management cites costly markups and payments made for placement of certain drugs on formularies, the list of approved drugs offered to plan members. These industry practices “can interfere with employers’ and consumers’ right to know the true cost of a drug,” the memo says.


    In the industry’s defense, the Pharmaceutical Care Management Association released a study by PricewaterhouseCoopers showing that drug managers save New York consumers an average of 25 percent on prescription drugs, which could translate into savings of $91 billion over the next 10 years. Other studies by the U.S. General Accounting Office, the Congressional Budget Office and the Federal Trade Commission have also found that PBMs help keep the cost of drugs down. “Ultimately, what consumers and purchasers want to know is: What is the bottom-line price?” says Phil Blando, a spokesman for the association.


    Many employers find themselves caught in the middle. One of several drug-purchasing groups put together by Aon Consulting Inc. includes seven large employers that contract with Medco for a group drug plan covering 1 million workers. Pricing must be considered, but so should performance and safety, says Gerald Smith, an Aon vice president. “Companies have due diligence to be effective in the way they manage their programs and not just look at price.” A step in the right direction would be to have more openness in the process, Smith says. “We want to make sure all the arrangements are disclosed so we understand everything that is going on.”


Workforce Management, October 2004, p. 43 — Subscribe Now!

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Diversity Training Addresses Sexual Orientation

Ryk Koscielski, a project manager at Lucent Technologies, spent years worrying that colleagues would learn his secret.



    He would be vague when asked about his weekends. He would refer to his same-sex partner as his roommate. And he would attend company parties alone. “I put a lot of energy into hiding personal information,” he says. “I thought that once I was out as a gay man, I wouldn’t have many opportunities for promotion.”


    Then his department attended a diversity session on sexual orientation. The day inspired him. After working with them for nine years, Koscielski told co-workers that he was gay. “It helped me personally and professionally to be comfortable at work,” Koscielski says, “and it helped my self-esteem.”


    Lucent, a leading global supplier of communications-networking equipment, is among a growing number of companies whose diversity training addresses sexual orientation. The Human Rights Campaign’s 2004 Corporate Equality Index, which evaluated how 379 companies treat gay employees, found that 76 percent of those companies offer diversity training on sexual orientation, compared with 53 percent in 2002.


On par with race
    Since coming out in 1994, Koscielski has become the co-president of EQUAL!, Lucent’s group for gay, lesbian, bisexual and transgender employees. EQUAL! offers three educational programs: GLBT (gay, lesbian, bisexual and transgender) 101, which covers terminology and explains why the company is broaching the topic; GLBT 201, in which gay employees share personal stories and explain laws; and Transgender 101, which discusses topics like sex changes.


    “For many years, ‘diversity’ meant looking only at racial, ethnic, gender and women’s issues,” says Selisse Berry, executive director of Out & Equal Workplace Advocates, a nonprofit organization that has offered sexual-orientation diversity training since 1990. “Often diversity trainers felt uncomfortable talking about LGBT issues.”


    Gradually, workforce policies are treating sexual orientation on par with other dimensions of diversity, such as race. Some companies embrace gay training because of philosophical beliefs in equality. Others see it as a way to foster teamwork, enhance productivity or woo gay consumers. The 15 million gay men and lesbians in the United States comprise a $583 billion market, according to consumer-market researcher Packaged Facts and marketing firm Witeck-Combs Communications.


    Whirlpool, the No. 1 U.S. home appliance manufacturer, ensures that employees understand the buying power of gay consumers by devoting a training module to the business case for diversity.


    Whirlpool held a weeklong Diversity and Inclusion Summit in May to launch the next phase of its diversity program. “We saw that people didn’t understand the concepts of diversity and inclusion, what their roles were in this space and how they contribute to our company,” says Angela Roseboro, director of global diversity. “We devoted a week to learning about diversity–what it was, what it wasn’t, what we are trying to accomplish and how we can build a culture of inclusion.” Sexual orientation was covered during the summit and in periodic lunch-and-learn discussions held subsequently.


    Chubb, one of the nation’s largest property-casualty insurers, introduced gay-specific diversity training in 1995. A half-day session called Understanding Gay Issues in the Workplace explained how homophobia affects employees and compared myths with facts. A full-day session called Managing Gay Issues in the Workplace used role-playing and case studies to prepare managers for issues such as subordinates coming out.


    This year, Chubb began a mandatory program, dubbed Count Me In, about understanding “micro inequities.” The term, coined by adjunct professor Mary Rowe of the MIT Sloan School of Management, describes subtle forms of discrimination such as failing to introduce a gay peer or ascribing the idea of a woman to a man.


    “There has been no backlash to the training,” says Kathy Marvel, Chubb’s chief diversity officer. “Chubb has been very specific in saying we are going to treat all employees fairly. It’s non-negotiable as one of our values. We have a clear commitment from the CEO down.”


    Pacific Gas & Electric, which serves Central and Northern California, began on-site sexual orientation training in 1991 and covers the topic in its new-employee seminar, held at PG&E’s San Ramon Learning Center. “There were a lot of myths, even here in San Francisco, that gay rights were more than equal rights,” says Dan Barber, president of PG&E’s GLBT employee resource group.


    Diversity consultant Liz Winfeld, author of Straight Talk About Gays in the Workplace, has seen two common mistakes when companies add sexual orientation to their diversity curriculums.


    “They don’t bother to find out what’s really going on in the workplace from all points of view–from their gay employees, their straight employees, people who are in favor of such programs and people who are opposed,” Winfeld says. “And you really shouldn’t roll out an educational program until senior management has gone through some version of it. So when people look up and say, ‘Why should be doing this?’ senior management can say, ‘We did and we got a lot out of it.’”

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A Profile of Diversity Officers

Here are some of the findings from its Diversity Officer Special Report:


    1. Compensation of diversity officers:


Average salary of $225,000 and average bonus incentive of 10 percent.
23.3 percent make more than $300,000 with a bonus in the range of $100,000;
46.4 percent make $200,000 to $300,000, with a bonus in the $75,0000 range;
30.3 percent make $100,000 to $200,000, with a bonus in the $50,000 range.


2. Average budget: $2.8 million


3. Most common titles:


Vice President–64.7 percent
Chief Diversity Officer–23.5 percent
Senior Vice President–8.8 percent
Director–17.1 percent
Many chief diversity officers are also Vice presidents or senior vice presidents.


4. Average staff size: 8.2 employees; 58 percent have 4 to 20 employees while nearly 30 percent have more than 20.


5. Average tenure: 10 years with the company, four years in the position.


6. Board reporting: 75 percent of diversity officers report to corporate boards on a regular basis.


7. Measurement: 92 percent of CEOs review statistics on diversity results and performance.


8. Suppliers: 80 percent of diversity officers have supplier diversity programs setting policies and goals for purchasing.

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Two Health Regulations to Watch For

Much has been made about the Republicans keeping control of the White House and widening their margin in Congress. What has received less attention is what this means to federal agencies.



    For example, President Bush’s re-election will enable two key agencies—the U.S. Department of Health and Human Services and the U.S. Equal Employment Opportunity Commission—to more easily wrap up some important health care regulations in 2005.


Medicare rules
    Health and Human Services is in charge of filling in the blanks for the new Medicare prescription drug benefit enacted in December 2003. The drug coverage is set to begin January 1, 2006. Although the basic Medicare drug benefit was specified in the legislation, many details were left to be determined, as is often the case when Congress passes a new law.


    A division of Health and Human Services called the Centers for Medicare and Medicaid Services is going to spell out the requirements that employers must fulfill to receive Medicare subsidies for providing prescription drug benefits to retirees. These requirements will also determine how employers can make their retiree health coverage secondary to (i.e., wrap-around) the Medicare drug benefit. These details will drive the cost and administrative burdens for the different options available to employers in choosing their retiree health care strategy.


    Final regulations should be issued this month–January 2005.


Age discrimination
    The other regulatory action will come out of the EEOC, which is trying to establish that employers can provide reduced health benefits to retirees who are eligible for Medicare–without violating age discrimination laws. This should be allowed, the EEOC has said, because Medicare benefits offset the lower employer coverage, retiree health coverage has historically worked this way, and it will enable more employers to provide retiree benefits.


    The EEOC regulation basically reverses a court ruling, Erie County Retirees Association v. Erie County, which says providing health benefits to Medicare-eligible retirees that are inferior to the benefits provided to other retirees (those under 65) violates the age-discrimination laws.


    Business groups and organized labor support the EEOC’s position, while the AARP does not. The final EEOC rule has been delayed by the presidential election and vocal opposition from the AARP. The Bush administration is now in the late stages of reviewing the rule.

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Aramark Serves Improved University Workforce Management

Food services giant ARAMARK Corporation improved the recipe for its labor management processes when it implemented Time America’s HourTrack system. “In the foodservice business, managing labor properly a key part of being able to grow profitably,” says Dominic L. Boffa, CIO and Vice President, Information Technology, ARAMARK Campus Services. Based in Philadelphia, ARAMARK Corporation is a world leader in providing awardwinning food and facilities management services. The company’s 200,000 employees serve clients in 18 countries.


Seeking Improved Labor Management
Executive management helped spearhead the search for a nextgeneration time and labor management system for the company’s Campus Services division, composed of 400+ college and university clients nationwide. “We identified the processes and tools needed to effectively manage labor costs and improve customer service,” says Mr. Boffa. “The effort included labor ‘champions’ from all our regions who brought their best practices to the table. These best practices formed the basis of our revised workflow and processes.”


ARAMARK chose to work with Time America, Inc. (OTCBB: TMAM), a leading provider of time and labor management solutions. ARAMARK Campus Services selected Time America’s HourTrack system “based on the company’s flexibility and dedication to customer service,” says Michael Tuno, Project Lead, Information Technology, ARAMARK Campus Services.


“Time America helped us develop a bidirectional data transfer between HourTrack and our existing payroll applications. The company’s implementation team also helped develop the custom reports we needed. Since then, we’ve implemented HourTrack at many other accounts, and are using the time and attendance, workforce scheduling and strategic reporting functions.”


Key Benefits
By selecting HourTrack, ARAMARK has reduced payroll expenses by better managing employee schedules and reducing overtime, according to Mr. Tuno. The company also eliminated many manual calculations, resulting in more time for its office staff to focus on other areas.


“This new system and processes have given us the tools to predict and plan our labor more effectively based on customer needs and have given us the data to measure performance on a monthly basis,” says Mr. Boffa. “Labor management reporting has become a key financial metric.” Another key benefit, according to both Mr. Boffa and Mr. Tuno, are their happy “clients” at ARAMARK locations nationwide.


One such location is West Chester University which has 275 employees and serves approximately 900,000 meals per year. “The biggest change we’ve seen is that now the managers can help with different aspects of labor and payroll that I used to handle on my own, allowing me to spend more time using other tools in the system,” says Lauren Saar, Administrative Assistant, ARAMARK at West Chester University.


Lessons Learned
In the two years since ARAMARK Campus Services began utilizing HourTrack, it has installed the system at accounts ranging from 50 to 450+ employees. “The processes and systems we implemented allow us to plan for the right mix of labor to support our operations cost-effectively says Mr. Boffa” “This translates to better customer service and an efficient application of labor. Improved payroll/timekeeping is a positive byproduct of those processes and systems.”


HourTrack is a trademark of Time America, Inc. All other trade names are the property of their respective owners.

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From Thailand to Tennessee

Kim Froggatt has experienced international relocation from both a personal and professional perspective. Thirteen years ago, she closed a successful consulting business and followed her husband, Steve, from England to Thailand, where he took a lucrative finance job.



    This past December, the situation was reversed when Steve followed her to Memphis, Tennessee, after she was named vice president of global services for Primacy Relocation.


    In her new position, Froggatt oversees the firm’s rapidly expanding international operations. In the past year, Primacy has opened or acquired offices in Canada, Germany, Switzerland and the United Kingdom, and it plans to open an office soon in Shanghai, China.


    In the aftermath of 9/11, she says the talent pool of senior executives with families who are willing to accept overseas assignments has shrunk considerably.


    “Companies have to offer more benefits and more sophisticated help to families to get these people to relocate,” she says.


    Primacy, for instance, can manage the entire immigration process for an employee moving overseas, expedite issuance of required documents and arrange and track benefits associated with home-leave trips. The company also can translate documents or arrange for translators, help arrange checking accounts and credit cards and provide readjustment training to help transferees and their families when they return home.


    In many ways, the 47-year-old Froggatt is a case study in how international relocation has changed in the past decade. When she moved to Bangkok for two and a half years, she was given virtually no settling-in assistance, such as information on where to send her young children to school.


    “Certain benefits, like housing and school fees, were paid for, but I was left to fend for myself otherwise,” she says.


    With no formal help, she initially learned much of the nuts and bolts of relocation by turning to other transferees and joining overseas organizations such as the Foreign Correspondents Club of Thailand. After that, she moved to Singapore for eight years, where she worked for the Canada-Singapore Business Council and then for four different relocation companies.


    While living in Singapore, she was a board member of Primetime, a professional women’s organization serving the expatriate community. She has also been on the board of directors of the Worldwide ERC, a leading relocation industry trade group in Washington, D.C.


    As part of her new job, Froggatt spends a lot of time giving spouses of transferees the kind of support she didn’t receive when she moved to Thailand. In places like Singapore, where spouses can easily get work permits themselves, her team provides cross-cultural training in such things as how job applications are worded and proper etiquette at job interviews.


    In Japan, where a spouse of a transferee can have trouble getting a work permit, she would provide different advice. “In that case,” Froggatt says, “we look for alternate ways to help the person maintain her skill set, such as doing volunteer work.”


Workforce Management, April 2005, p. 51 — Subscribe Now!

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Selection Tool Serves Up Recipe for Success

The first ingredient in the recipe for success in the restaurant business is hiring great people. According to Lance Trenary, Senior Vice President of Operations for Golden Corral restaurants, great people combined with a great concept generate the type of business results any company would welcome: increased profits and employee satisfaction.

Golden Corral’s mission is to make pleasurable dining affordable in their clean, fun, friendly atmosphere—a philosophy that is culturally embraced by the company’s coworker and management teams. Recruiting and retaining the best talent in the industry has helped the company secure its position as America’s #1 family restaurant chain.

“The biggest thing we are always focused on is recruiting, hiring and training the best talent in the industry,” says Trenary. “We have the best product offering out there, but if we don’t have a great manager running our restaurant, we’re dead in the water.”

Three years ago, Golden Corral was experiencing management turnover close to 50 percent. With a high level of turnover, the operations team knew they needed to refocus on the talent that was joining the team. Company analysis over 30 years of operation indicates that the more tenured the management team, the better the profitability of the restaurant.

To improve the tenure of the management team and reduce turnover, Golden Corral began using Kenexa®’s talent management solutions to aid in their recruiting and retention efforts.

“Kenexa helps us identify the people who have the highest likelihood of being successful and being a successful part of Golden Corral,” said Trenary. “They help us sort through the literally thousands of applicants we get to find the people who will thrive in our culture.”

Applicants who don’t pass the first step in the Kenexa screening process do not go on to the next phase of the interviewing process. Trenary notes that the Kenexa solution can tell them right “off the bat” if a potential candidate is someone they want to pursue.

In the three years since Golden Corral began using Kenexa Insight® Interviews for their management level, they’ve been able to reduce turnover down to 20 percent, equaling 80 percent retention of salaried management. Trenary remarked that the cost of turning a manager is nearly $25,000. By increasing manager retention, they are able to increase the organization’s profitability.

“We’re very sold on the behavioral-based interviewing system and just purchased Kenexa’s Insight Coworker Interview Solution,” added Trenary. “We have improved our management retention by over 30 percent and our goal with the Coworker Interview is to improve our coworker retention to 50 percent.”

“These decisions are not only cultural, but they’re also dollars and cents,” said Trenary. “The Kenexa solution is obviously helping us sort for the best talents which helps increase our own profitability through retention and stability in the restaurants. A lot comes down to financials and we’ll make more money by hiring great coworkers that fit our culture and Kenexa enables us to do that.”

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The Costs of Hardship and Danger

How much should you pay an employee who is willing to risk their life on your behalf in a hot spot? Many companies look to the U.S. State Department, which calculates just how 40,000 citizens assigned to 600 posts abroad, will be compensated for the varying risks they assume.

    The State Department compiles quarterly reports determining what allowance an employee living abroad deserves for enduring both hardships and danger. The “hardship differential” is intended to compensate for living in unhealthy or physically difficult conditions. “Danger pay” is to compensate for living in the midst of civil insurrection, civil war and terrorism, which presents a threat of harm or imminent danger to the employee. These differentials, which range up to a maximum of 25% of base pay in each category, are not intended to apply to housing, which is provided by the government.

    While private companies usually exceed the premiums suggested by the State Department, the figures are never the less useful in objectively assessing the difficulties and dangers expats are likely to encounter. Bogota, Columbia, for example, wins only a 5% hardship differential, as many amenities that Americans expect are easily obtained, but scores a 15% differential on danger pay. Baghdad, unsurprisingly, scores 25% in each category. Here are some samples of other locations, and how difficult and dangerous they are judged to be in each category.


Location

Hardship Pay
Differential

Danger Pay Differential
Bujumbura, Burundi 25% 25%
Jerusalem 10% 20%
Nairobi, Kenya 25% 0%
Kuwait City, Kuwait 15% 15%
Beirut, Lebanon 20% 25%
Monrovia, Liberia 25% 25%
Islamabad, Karachi Lahore & Peshawar, Pakistan 25% 25%
Kosovo, Serbia & Montenegro 25% 25%
Pristina, Kosovo 25% 20%
Freetown, Sierra Leone 25% 15%
Khartoum, Sudan 25% 15%
Sanaa, Yeman 20% 15%
Source: U.S. Department of State reports

Workforce Management, June 2004, p. 34 — Subscribe Now!

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Beyond Unions

Coleman peterson, Wal-Mart’s former executive vice president of people, left behind a company facing a human resources public relations nightmare.



    While the 56-year-old human resources veteran says he departed the company voluntarily in April because “there were other things in my life I wanted to do” after 32 years in retailing, some labor experts wonder if he was a fall guy.


    “Wal-Mart’s image as an employer has been really going downhill, and it’s been on this guy’s watch,” notes Paul Clark, professor of labor studies and industrial relations at Penn State University. “You would think he would have to accept responsibility or blame for the rocky road they’ve had in recent years.”


    Peterson, now president and CEO of Hollis Enterprises, an organizational consulting firm he founded in Bentonville, Arkansas, was not on hand to help his replacement, Lawrence V. Jackson, with the transition. He’d left Wal-Mart several months before Jackson began his new job in October. But at the behest of Wal-Mart chairman Lee Scott, Peterson says he entertained Jackson and his wife, Kimberly, before Jackson started the job and that they talked about relocation issues.


    While Jackson has no human resources experience, Peterson says he’s “very excited” that he was hired. “He has operated at the senior operations level, which gives him some good strategic management skills, and that with the fact that he’s surrounded with great HR people with great competency will work well.”


    He predicts that Jackson will have his hands full dealing with immense projects ranging from protecting the Wal-Mart brand to developing workplace technology to be used to hire and promote employees.


    “Wal-Mart has always had a great reputation, but there are constituents out there that are not interested in allowing Wal-Mart to retain that good reputation–labor unions, for example,” Peterson says.


    Some labor experts believe one of Jackson’s main tasks will be keeping unions out, but Peterson calls that “a myopic view.”


    “Our belief is we don’t need unions at Wal-Mart to represent workers,” he says. But he adds that “the principal role of Lawrence Jackson will be to get good people, keep good people and grow good people.”


    As for technology, Peterson says Wal-Mart is in the process of rolling out a new program using technology to promote and hire employees, and that Jackson will play a key role in its implementation. When a potential worker walks into a Wal-Mart store they’ll be able to apply online, and that information will go into a centralized database.


    This system is already being rolled out at the retailer’s stores across the country, he says. And on the horizon, Wal-Mart plans to use technology to marry an employee’s career interests to the jobs available. “No one person is smart enough to know how to do that effectively with an organization of 1.5 million people,” he says. “Technology is.”


    With a large class-action discrimination lawsuit pending against Wal-Mart, such types of systems may end up becoming a requirement for the retail giant in order to ensure that its promotion practices are fair as it continues to grow. In the lawsuit, which was filed in June 2001 by six female Wal-Mart employees and gained class status last year, one of the allegations is that women were denied promotions.


Peterson himself has become embroiled in the discrimination suit. A memo he wrote in February 2001 to Wal-Mart’s executive committee discussing a Catalyst study on female corporate officers and top earners at Fortune 500 firms is now a plaintiffs’ exhibit in the case. “Although Wal-Mart has made improvements over the last five years in this endeavor, we are still behind both the Fortune 500 and general merchandisers in the development of women into corporate officers,” the memo states.


    “What I meant was, we were continually making progress,” Peterson says of the memo. “The question is, is it fast enough, high enough? An organization never improves itself without being critical of itself. It’s a positive process.”


Workforce Management, March 2005, p. 37 — Subscribe Now!

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The (401) Gamble

I  barely know a straight from a flush, but I won several hands at a friend’s poker party recently. After a couple of cosmopolitans, I howled at the moon, stacked up my handfuls of chips and cashed in. A measly 20 bucks was all I’d won. In my tipsy excitement, I’d lost sight of the fact that the white, red and blue chips were only nickels, dimes and quarters.



    That’s where we are today with 401(k) plans. Employers and workers are under the illusion that successful retirement planning is taking place, but in reality, it’s yielding penny-ante returns. When boomers start cashing in their chips, there will be howls indeed.


    In theory, employees are doing fine in the land of defined contribution–better than they would under a defined-benefit pension plan. According to investment simulations, workers in the 55-64 age bracket have a median of $289,073 in 401(k) retirement savings. But that is, after all, a Sim 401(k), and it bears as much relation to reality as the Sims video game does to your life.


    Retirement-age workers actually have amassed only $42,000 in their 401(k)s, according to Alicia H. Munnell, director of the Center for Retirement Research at Boston College. Munnell is co-author with Annika Sundén of a recently published book, Coming Up Short: The Challenge of 401(k) Plans.


    The problem is that 401(k)s are all about choices, and at every step of the process, employees make bad ones, Munnell says. “Roughly 25 percent don’t join the plan. Less than 10 percent contribute the maximum. Only half the people diversify their investments. The others put it all in stocks or all in bonds. A significant fraction overinvest in company stock.” Yes, even after Enron.


    And on and on, with behaviors all too familiar. More than half cash out their plans when they change jobs, despite all the chiding and chivying by employers and the IRS. They also take their money in a lump sum at retirement, and have no clue how to spend it. The stereotype is of giddy retirees blowing their money on canasta and cruises, but Munnell says they’re much more likely to under-spend. It’s the cat-food-and-toast syndrome, and I’ve seen it firsthand.


    Traditionally, the cure for all these very human lapses has been employee education. Munnell just groans at that. “I think that if I were queen, and wanted to make all employees into mini-investors, it would not be a good way to use our resources. They should go coach little league, or read a book, or go to church, but it won’t enrich our nation to have everyone learn to invest their portfolios. To be anti-education is such an abnormal thing, but I am.”


    Instead, Munnell and some economists and investment companies propose that employers put the power of human inertia to work. The tool is the “autopilot 401(k).” Vanguard calls its version One Step. MassMutual has a small piece of the puzzle in place with a new age-based asset-allocation option, the MM Destination Retirement Series.


    It works this way: Employers put workers into the 401(k) automatically. One study shows that doing so increases participation from 37 percent to 86 percent. They set a high contribution level. They set an immediately vested employer match. They make investment choices with an appropriate fund mix for an employee’s stage of life, and change it as the employee nears retirement. They automatically roll the money into an IRA if the employee leaves. They pay the retirement benefit as a joint-and-survivor inflation-indexed annuity. The employees can opt out or choose something different at any stage. But the law of human inertia indicates that they’ll just leave everything where it is, and then that $289,073 could be reality.


    This may sound like a throwback to company-knows-best days. So what? The alternative is having your offices haunted by “a bunch of 60- and 65-year-old employees who don’t have enough money to live on,” as Munnell says.


    The snag is fiduciary liability. And until the IRS and Department of Labor offer some protection, companies won’t run the risk of being sued. Munnell says that recent IRS and DOL decisions show they’re willing to stand behind prudent employer choices. “It’s all possible,” she says. It sure beats losing at 401(k) poker.


Workforce Management, June 2004, p. 10 — Subscribe Now!