Representative Charles Rangel (D-New York), said Friday that his bill would equalize company stock sale rights. The Rangel bill will add tax penalties if executives and corporate “insiders” sell shares of a firm that still limits workers from doing the same in their 401(k).
Rangel is the ranking Democrat on the House Ways and Means Committee, which has jurisdiction in the House over pension tax law.
“With Enron, executives and corporate board members could unload the stock when they sensed a problem, but the workers were locked in,” Rangel said in a statement.
During the critical period within which Enron collapsed, it prohibited all 401(k) sales of stock while its executives sold over $1 billion in Enron stock outside of that plan, according to published reports.
Rangel’s proposed bill would extend to certain current company stock sales excise taxes that were imposed in the 1980s on golden parachute severance packages.
The provision would be in effect for six months while Congress worked out permanent worker protections, Rangel said, according to the Bureau of National Affairs.
Also this week, Rep. George Miller, (D-California), said he would propose a bill to require workers be given accurate information about their pension benefits and any employer stock holdings in their pension plan.
Miller’s bill would also give vested workers he opportunity to diversify their employer contributions beyond company stock and not be required to hold company stock in a “blackout.”
Miller would require companies to give workers adequate notice before such a ‘blackout” and lockdowns would be limited to no more than 10 business days, the lawmaker said in a statement.
Those proposals join a series of other legislative proposals put forth by Senators Boxer and Corzine, as well as Representative Ken Bentsen (D-Texas) last month.