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Summary Plan Description (SPD)
A reporting requirement of the Employee Retirement Income Security Act (ERISA) that obligates employers to describe the plan's funding, eligibility requirements, risks, and so forth within 90 days after an employee has entered the plan
Cash balance Plan
Retirement plan in which the employer sets up an individual account for each employee and contributes a percentage of the employer's salary; the account earns interest at a predefined rate
Preferred Provider Organization (PPO)
a group of health care providers who contract with employers, insurance companies, and so forth to provide health care at a reduced fee
Health Maintenance Organization (HMO)
a health care plan that provides benefits on a prepaid basis for employees who are required to use only HMO medical service providers
Marginal Tax Rate
percentage of an additional dollar of earning that goes to taxes
Financial Accounting Statement (FAS) 106
states that any benefits (excluding pensions) provided after retirement, cannot be funded on a pay-as-you-go basis.
employee retirement income security act (ERISA)
the 1974 act that increased the fiduciary responsibilities of pension plan trustees, established vesting rights and portability provisions, and established the Pension Benefit Guaranty Corporation (PBGC)
consolidated omnibus budget reconciliation act (COBRA)
the 1985 act that requires employers to permit employees to extend their health insurance coverage at group rates for up to 36 months following a qualifying event, such as a layoff.
Family and Medical Leave ActÂ
the 1993 act that requires employers with 50 or more employees to provide up to 12 weeks of unpaid leave after childbirth or adoption; to care for a seriously ill child,spouse, or parent; or for an employees own serious illness
pension benefit guaranty corporation (PBGC)
the agency that guarantees to pay employees a basic retirement benefit in the event that financial difficulties force a company to terminate or reduce employee pension benefits
