November 6, 2015

The Task Force met for several hours in person and by teleconference to continue its deliberations. Highlights:

  • Continued discussion of a defined contribution supplemental benefit approach, including:
    • Impact of a UC self-assessment (“surcharge”) on the employer portion of the supplement
    • Design options
    • Eligibility of different employee groups
    • Vesting considerations
  • Continued discussion of defined contribution choice options. Topics included:
    • Review of other large, private-sector employer defined contribution plans
    • Employer contribution options
    • Appeal of DC choice options for different UC employee groups
  • Discussion with Principal Counsel Clark regarding plan choice options including:
    • Tax code requirements impacting plan choice (for both UC and employees) of different plan designs and employee scenarios (e.g., rehired retirees)
    • Employer cost and employee tax considerations
  • Report out by task force members regarding consultations with constituent groups.
  • Brief discussion of task report structure and timing.
  • Next Task Force meeting: Nov. 13.

November 13, 2015

The Task Force held an all-day meeting in Oakland to continue its deliberations. Highlights:

  • The majority of the meeting involved continued discussion of defined contribution (DC) choice options. Topics included:
    • Plan costs, employer/employee contribution options, employee vesting and other considerations under different plan design options
    • Relative value (from employee’s perspective) of DC choice vs. UCRP defined benefit at different career entry/exit points
    • Continued discussion of appeal of DC choice options for different UC employee groups
    • Pros/cons from both employer and employee perspective of different “second choice” options (a one-time option for employees to choose a different plan after a specified time period — i.e. make a second choice)
  • Report out by task force members about consultations with constituent groups. Comments included:
    • Perception of some constituents that a DC option could undermine stability of UCRP (the group was reminded of the FAQ regarding this topic on the project website)
    • Lack of understanding among some constituents about differences between defined benefit/defined contribution plans
  • Review and discussion of task report structure.
  • Next Task Force meeting: Nov. 18.

November 18, 2015

The Task Force met for several hours by teleconference and in person to continue its deliberations. Highlights:

  • The meeting focused primarily on summarizing/finalizing recommendations regarding a defined contribution (DC) choice option. Topics included:
    • Financial/cost considerations (including ways to pay down UCRP unfunded liability)
    • Employer/employee contribution options
    • Relative parity between a DC choice option and a defined benefit (DB) + DC supplement option
    • Employee vesting
  • Due to time constraints, discussion of task force member consultations with constituent groups, and the UCOP implementation communications plan, was rescheduled for the next task force meeting.
  • Next Task Force meeting: Nov. 30.

November 30, 2015

The Task Force met for several hours by teleconference and in person to continue its deliberations. Highlights:

  • The meeting focused primarily on finalizing the Task Force’s recommendations regarding potential defined contribution (DC) supplemental benefit and choice options. Topics included:
    • Financial/cost considerations
    • Employer/employee contribution options (including employer contributions toward the unfunded UCRP liability)
    • Employee vesting
    • Default plan considerations
    • Eligibility for DC supplemental benefit
    • Employee population growth assumptions
  • The Task Force received a high-level overview of the UCOP implementation communications plan. Priorities for the communications plan include:
    • Ensuring current employees and other internal audiences, are kept informed throughout the process
    • Ensuring current employees (and retirees) understand their retirement benefits are unaffected
    • Ensuring future employees (hired 7/1/16 or later) have the informational tools they need to make informed decisions
    • Reminding all interested parties that the 2016 retirement benefits options will be subject to collective bargaining for represented employees, and that union leaders will help determine retirement benefits options for their future members
  • Communications are expected to include a mix of print and digital informational tools, including booklets, fact sheets, FAQs, video and an interactive modeling tool (assuming DC choice is offered).
  • Review of the steps and timing involved in finalizing the Task Force report.
  • Next Task Force meeting: Dec. 8.