Employee Benefits Bill Passed by House Committee

March 14, 2002 (PLANSPONSOR.com) - The US House Ways and Means overwhelmingly approved The Employee Benefits Bill of Rights, which protects retirement plan participants from some of the pension problems that befell the employees of Enron Corp.

Co-sponsored by pension and benefit activists Representatives Rob Portman (R-Ohio) and Benjamin Cardin (D-Maryland), the bill (H.R. 3369) would give workers new rights to diversify their retirement portfolios. It would also make sure they received adequate notice before any “blackout” periods were imposed.

One of the key issues in the Enron collapse were allegations that executives improperly pressured participants to buy Enron company stock for their 401(k) accounts, but then kept them from selling it even as its share price was plummeting. 

According to a Reuters report, the bill passed on a 36-2 vote. It’s expected to be joined with other reform proposals before being presented on the House floor, where it is expected to come up for a vote in April.

Among the bill’s provisions:

  • a required 30-day notice of a blackout,
  • a mandate for plan sponsors to give participants investment education about managing risk and the dangers of overweighting a portfolio in the stock of one company, and
  • provision of  tax incentives for companies that provide retirement advice and counseling