Category Archives:Pension


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California Will Be Ringing In 2013 With New Laws

Governor Jerry Brown signed approximately 900 bills into law in 2012, most of which take effect January 1st, 2013. The legislation encompasses a variety of topics such as: pension changes for public employees, new funding mechanisms for the state park system, and new employment laws.  

Homeowners will have increased protections from foreclosure under some of the hundreds of state laws taking effect with the new year.

Meanwhile, lower-income, private-sector workers whose employers do not offer retirement plans may be able to take advantage of the California Secure Choice Retirement Savings Program.

SB1234 and SB923 would require employers to withhold 3% of their workers’ pay unless the employee opts out of the savings program. But the program cannot start enrolling workers until it receives final authorization from the Legislature.

Pensions for public employees will be reduced under a separate bill, a change that is expected to save taxpayers billions of dollars over the coming decades. AB340 increases retirement ages for new public employees, caps annual pension payouts, prohibits several practices used to inflate pensions and requires public-sectors workers to pay more if they are not already contributing half their retirement costs.

The pension changes were sought by Brown as part of an overall plan to reduce government spending.
Several other laws respond to recent news developments.

Coaches and administrators in K-12 schools as well as higher education employees who have regular contact with children will be required to report suspected child sexual abuse. AB1434 and AB1435 were prompted by the scandal involving former Penn State University assistant football coach Jerry Sandusky, who was convicted of sexually abusing 10 boys. Authorities say some former co-workers knew of the abuse but failed to report it to law enforcement.

“Caylee’s Law” is named after the 2-year-old daughter of Florida’s Casey Anthony, who was acquitted of the girl’s murder in 2011 despite waiting a month before telling authorities that her daughter was missing. AB1432 makes it a misdemeanor punishable by up to a year in jail if a parent or guardian fails to report the disappearance or death of a child under the age of 14 within 24 hours.

Attempts to pass similar laws in some other states failed because lawmakers were concerned the changes would be too broad.

AB45 is named after 19-year-old Brett Studebaker of San Mateo, who died in 2010 after drinking on a party bus and crashing his own vehicle while driving home an hour later. It holds party bus operators to the same standards as limousine drivers, making them legally responsible for drinking by underage passengers.
California employers will be required to comply with a number of new laws in 2013. 

Employers Must Accommodate Religious Dress and Grooming (AB 1964/Government Code 12926 and 12940): Employers must accommodate an employee’s or job applicant’s “religious dress” or “grooming practices.”  Religious dress includes the wearing or carrying of religious clothing, head or face coverings, jewelry, and artifacts.  Religious grooming practices include those pertaining to head, facial, or body hair that are part of the observance by an individual of his or her religious creed.  This new law specifically provides that segregating the employee from the public or other employees is not a reasonable accommodation. 


New Regulations Related To Pregnancy Disability Leave:  New pregnancy regulations redefine the number of days that employees may take for pregnancy disability leave.  Instead of the previously defined “four months” of leave, the leave is now defined as 17 1/3 weeks to account for the uneven number of days in certain months.  Employers are also required to notify employees in writing when a medical certification is required for the leave of absence.  In light of these changes, employers are required to post new notices in the workplace that notify employees of the changes. 


Employers Must Provide Employees Written Commission Agreements, But Some Exceptions Apply (AB 2675/Labor Code 2751): Employers who pay regular commissions must provide employees with an executed written contract setting forth both the formula for calculating commissions, as well as the method of payment.  Failure to comply with this new law may subject an employer to penalties under California’s Private Attorney General Act (“PAGA”) in the amount of $100 for each affected employee for an initial violation and $200 per employee for each violation thereafter.  The term “commissions” does not include:  (1) short-term productivity bonuses such as those paid to retail clerks; (2) temporary incentives that increase commissions; or (3) bonus or profit-sharing plans, unless they are based on a fixed percentage of sales or profits. 


If you or someone you know believes they have a workplace complaint, call Don Ho Law at 714-748-7715 to speak with an experienced employment law attorney who can discuss your options with you.
Published by Don Ho Law.  Don Ho is a criminal defense and employment law attorney in Orange County, California.




What is a QDRO? How Divorce Affects Retirement

If you are filing for divorce or facing property division, you may have heard of a QDRO. If you have complex assets, including retirement accounts, there are specific legal processes and documents that must be completed to ensure that both parties are protected.
A Qualified Domestic Relations Order (QDRO) directs your pension plan administrator to give a portion of it to your ex-spouse after the divorce is final. 
retirement
Retirement (Photo Credit)

The following is a common scenario involving the QDRO:

  • A settlement agreement states that retirement assets will be equally divided between the husband and wife.
  • Three months later with a QDRO in hand, the couple finds out that the 401(k) has gone down in value and the non-qualified pension plan can’t be divided.
  • At this point, it’s necessary to determine the plan’s official division date and whether or not equivalent assets, temporary benefits, or cost of living adjustments in the plan were considered in the divorce decree.
This was an example of a common problem that arises because QDROs have only been around since 1984 and there is still confusion among some family law attorneys regarding splitting retirement plans.
Because QDROs can be complicated, it’s probably wise to consult an attorney experienced in dealing with them. But here is some basic information about QDROs:

What Qualifies as a QDRO? In general, a QDRO is a court-issued judgment, order, or decree that formally approves a property-settlement agreement that involves a retirement plan. 

What Must be Included in the Order? A QDRO must contain the following information:

  • The name and last known mailing address of the participant, and each alternate payee;
  • The name of each plan to which the order applies;
  • The amount or percentage, or method for calculating the amount or percentage, to be paid to the alternate payee;
  • The number of payments, or time period, covered by the QDRO.
 
How Does QDRO Work? The order will describe how the assets will be divided. The forms can be filled out by participants, but there are very specific legal requirements, so an attorney can be helpful to answer any questions.

Are QDROs Required During Divorce? Yes, a QDRO is required for any retirement plan covered by ERISA, the Employee Retirement Income Security Act. 

Does a QDRO Need Approval? Yes, the QDRO must be approved by an administrator and it must meet certain requirements. 

Are There Early-withdrawal Penalties? No, QDRO transfers from a retirement account do not incur any early-withdrawal penalties

Legal updates provided by the Orange County and Riverside Law firm of Don Ho, LLP.
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