The Congressional Record is a unique source of public documentation. It started in 1873, documenting nearly all the major and minor policies being discussed and debated.
“ERISA CLARIFICATION ACT OF 1996” mentioning the U.S. Dept of Labor was published in the Extensions of Remarks section on pages E389 on March 20, 1996.
The publication is reproduced in full below:
ERISA CLARIFICATION ACT OF 1996
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HON. MARGE ROUKEMA
of new jersey
in the house of representatives
Tuesday, March 19, 1996
Mrs. ROUKEMA. Mr. Speaker, today I am introducing the ERISA Clarification Act of 1996.
For almost 20 years, the insurance industry has relied on a Department of Labor interpretive bulletin stating that assets contained in an insurance company general account were not plan assets under ERISA.
However, in 1993 the Supreme Court ruled in John Hancock versus Harris Trust that such pension assets were covered by ERISA. Because the court recognized that this interpretation could seriously disrupt pension management, it recommended that potential problems be addressed either administratively or legislatively.
Although the Department of Labor is currently working to develop new rules governing prospective insurance company activities, without legislative changes, insurance companies might go unprotected from retroactive liability further threatening the security of pension assets.
Because of the manner in which insurance companies have managed their pension assets over the past 20 years, this legislation will remove the threat of retroactive liability. In doing so, pension plan participants and beneficiaries will be protected without affecting any ongoing civil action.
Since the Department of Labor issued its interpretive bulletin in 1975, there is little evidence that plan participants have suffered as a result of this longstanding practice of the insurance industry. In fact, prior to the Harris Trust decision, the Department of Labor had not initiated any enforcement proceedings based on alleged mismanagement.
If we do not address this issue, we will seriously risk the safety and security of pension assets while unfairly exposing the insurance industry to retroactive liability costs based on actions which, at the time, were in accordance with the Department of Labor's rules and regulations.
Therefore, I would ask my colleagues to join me in this effort by becoming cosponsors of this necessary legislation.
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