Consumer Agenda for Retirement Security

Initiative #4: Improve traditional and hybrid pension plans

The recent financial crisis has demonstrated the value of defined benefit plans, which provide participants with guaranteed benefits, typically paid in annuity form.  While participants in defined benefit plans continue to enjoy the promise of their guaranteed benefits, participants in defined contribution plans have lost as much as a third of their retirement savings in the last few months.  This is especially devastating to retirees and to working men and women close to retirement age. 

However, there are too many gaps in the current law that permit employers to rescind promises or that fail to protect employees’ reasonable expectations of benefits.  There are also measures needed to encourage companies to preserve their defined benefit plans.  Hence, we need to both preserve defined benefit plans and to protect workers’ reasonable benefit expectations.

A. Protect earned pension benefits when companies are bought and sold.

B. Protect earned pension benefits in bankruptcy proceedings.

C. Protect earned pension benefits when multiemployer plans become underfunded.

D. Protect promised future benefits when single-employer plans become underfunded.

E. Rescind new interpretive bulletins on economically targeted investments and voting proxies.

F. Allow former spouses to collect benefits when a worker is eligible, regardless of whether the worker actually retires.

G. Restore more realistic funding requirements for ongoing pension plans.

H. Link executive and rank-and-file employee retirement benefits. 

I. Extend insurance and anti-forfeiture protections to plans related to religious institutions.

J. Fix the rules that allow executives to use rank-and-file pension plans to enrich their own retirement.

Learn more about the other initiatives in the Consumer Agenda for Retirement Security.

Initiative 1: Promote a more adequate and secure private retirement income system.
Initiative 2: Empower workers to promote their own retirement security.
Initiative 3: Improve retirement savings plans.
Initiative 4: Improve traditional and hybrid pension plans.
Initiative 5: Make retirement plans fairer for workers and their spouses.

Print the Consumer Agenda for Retirement Security [PDF].