September 1994

No Such Thing as a Perfect Law

As they wrangled over details of US health care reform on Capitol Hill last summer, US legislators might have benefited from a few sidelong glances at the ERISA debate of exactly 20 years ago.

Playing Hardball

Baseball owners raised the temperature in this summer's strike by withholding a payment to the players' pension fund. But the rarely seen move should not harm the well-funded plan.

Simplification Revisited

Pension simplification is back on the table in Congress this year. But the new bill contains troubling elements, and is fighting for attention with higher-profile issues.

If At First…

Illinois' latest attempt to cure unfunded pension obligation woes looks to have the best chance of success yet. But a hefty tax increase would likely be part of the cure.

Mixed Reviews

Twenty years after ERISA's passage, the US private pension system is very different from what the law's framers imagined. If its central element-the defined benefit plan-is to be saved, critics say, change is in order.

A Legislative Draftsman’s Perspective

ERISA succeeded in accomplishing its chief objectives, says one of its authors. But times have changed, and a great debate about the future of private pension development is about to begin.

The Employers Changing Role

The accent is on self-reliance as employers large and small are rethinking their old paternalistic role, including the firmness of their commitment to providing retirement benefits, says EBRI's president.

Preemption Taken to the Extreme

ERISA allows the states to enact laws in certain areas that are important to multi-employer plans. But these are being seriously threatened by courts that interpret ERISA's preemption rule too narrowly, says a union leader.

Hydro’s Shake-Up

Faced with a budget crunch and rising employee benefit liabilities, Ontario Hydro has turned to one of Bay Street's biggest money managers to carry out a sweeping reorganization of its C$7 billion pension fund.

Budapest to Bay Street

A skeptic of government promises, Andrew Sarlos is now charged with preserving and extending such promises to some 18,000 Ontario public utility workers.


A study commissioned by the big fund links workplace conditions and employment practices with stock performance. But CALPERS officials downplay the effect its findings will have on investment policy.

Broader Scope of Vulture Funds

Dwindling deal supply has caused a slowdown in vulture fund launches this year. Managers are compensating by expanding the range of distressed securities that can go into new funds.

Stuck on the Mezzanine

Demand for mezzanine financing is down but some investors still like them. So managers are developing novel structures to meet the demand.

No Fear

Despite the first-quarter downturn in international markets, North American pensions are stepping up their commitments to overseas money managers this year.

A Lesson from Down Under

Melbourne's Transport Accident Commission has been one of Australia's best performing public funds. Now its investment team can bring other funds into its orbit.

Retro Active

A new Supreme Court decision in an ESOP case upholds Congress's right to pass retroactive tax law changes.

Speaking in Tongues

As more non-English speakers enter the workforce, employers concerned about discrimination testing supply multilingual plan descriptions for their DC participants.

The Age Game

CIBA's pension trust is searching diligently for derivatives strategies that will help it not only to control risk but boost yield for its youthful participants.

High Fliers

The United Airlines buyout, while setting up an ESOP that will eventually own 55% of the company, preserves most of employees' current retirement benefits.

Squeezing Out Overdrafts

Higher daylight overdraft penalties are changing the way your bond brokers operate in the repo market. By encouraging tri-party repos, they hope to minimize the impact.

Navigating the Tax Reclaim Jungle

A well-defined tax reclaim strategy can mean significant savings for large international investors. But in most markets, the process is not easy.

Tax Recovery in Europe

Conditions in a selection of large markets. From BDG Management Consulting's survey of income withholding tax regimes in European markets.