Senate Committee Passes Kennedy Bill

March 21, 2002 ( - Responding to the Enron debacle, which saw many employees losing their retirement savings through investments in Enron stock, a Senate committee passed legislation that would limit employer stock in 401(k) plans.

The legislation, the Protecting America’s Pensions Act of 2002, introduced by Senator Edward Kennedy (D-Massachusetts), would allow employers to either contribute to their employees’ plans with company stock, or allow workers to purchase it as a retirement plan investment option – but not both.

The bill also would require that workers and plan participants be represented on a company board overseeing retirement plans.

While the spirit of the bill is to protect workers savings, its opponents argue that the proposal would lead to employers ending their matching contributions programs.

The vote, by the Senate Health, Education, Labor and Pensions Committee, was scheduled for earlier in the week, but Senate Republicans  shut down committee votes in retaliation for the rejection of a federal appeals court nominee. (See Senators Shut Down Enron Hearings, House Bill OK ).

That temporarily delayed Senate action on pension protections – but the House Education and Workforce Committee passed its