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Jerry Schlichter and Jamie Fleckner have some things in common. They both got into law through political activism, and they’ve built their careers on ERISA litigation. But where they differ is largely about who their clients are. One represents plan sponsors and their providers, the other represents employees who feel they have been wronged, and their legal battles have shaped how the defined contribution retirement space thinks about innovation. In this episode, we sit down with each to try to understand the history of these cases, how they work, and how litigation has influenced plan sponsor decision making. Key Takeaways: [:25] Josh opens up today’s episode on lawsuits and the effects it has on innovation. How did we get here in the first place? Let’s ask some prominent lawyers about the history of how this all came to be.    [2:25] Jerry has always been an advocate for civil rights and has seen first-hand how much good law and order can do. After being a student protester and passing the bar, Jerry took on race and gender discrimination cases against large companies.   [4:05] Jerry’s path eventually led him to investigating 401k plans for minorities. The more he saw, the deeper he dug. He found himself in unknown territory. There was no definition on how companies were making their investments or the types of fees they were charging. If he were to take on this case, he would be going to war with companies with big pockets.    [7:55] As a young lawyer that represents plan sponsors at the time, Jamie found himself deep into ERISA topics. Jamie mostly worked around the issue of company stock options and retirement plans, but what Jerry brought to the table was completely different. Plan fees have to be monitored and capped based on what’s happening in the market. Third-party mutual funds saw ‘record keeping’ fees as a loophole.    [11:45] Jerry was challenging some pretty ‘status quo’ practices. In trial, Jamie saw first hand how little people understood about ERISA. After a month’s long trial and several witnesses taking the stand, the judge still had a thousand questions on how this process all works.   [15:15] Jerry knew he had to be detailed and diligent in his work. They had to make sure their research was accurate. His team read every public information available to understand this better.    [18:45] The human element really comes to light in cases like this. A plaintiff was displeased with her plan sponsor and her 401k investments, but inadvertently didn’t know that by suing them, she was also suing her former employer; who she loved.    [22:20] Trials are a big production with a lot of emotions to balance in between. Jamie explains why most companies decide to settle, even if they’re in the right.    [26:15] Appeal after appeal, Jerry sees his case go to the supreme court. The first 401k excessive fees case in history.    [29:15] Despite Jerry and Jamie been on both sides of an ERISA lawsuit more than once, they know that, for the most part, plan sponsors are not crooks.   [33:40] As long as plan sponsors make decisions based on the best interest of their participants, everything will be fine. This means, a lot more sponsors are playing things safe when it comes to other people’s investments.    Thank you for tuning in. If you liked what you heard, please subscribe and leave us a review wherever you listen to your podcasts. Links: The Accidental Plan Sponsor Mentioned in this episode: More about Jerry Schlichter More about. Jamie Fleckner

While saving for retirement has been simplified and streamlined in recent decades, with tools like auto-enrollment and target date funds, the retirement savings ecosystem is anything but simple. It’s a complex confluence of innovators, service providers, employers, workers, consultants, lawyers, and, yes, government officials. Regulators play a huge role in our industry, so understanding who they are and how they work is an important factor in the outcomes for plan sponsors and plan participants. In this episode, we speak with two former Department of Labor EBSA directors, Brad Campbell and Phyllis Borzi, about the challenges and opportunities in regulating the employee benefits space, including the enactment of the landmark Pension Protection Act of 2006. Key Takeaways: [:04] Josh opens up today’s episode with a quick recap of episode 5 which focused on the work of two innovators in the field. He opens up this part of the conversation on what made the start of Target Date Funds and automatic enrollment so very impactful, the passage of the Pension Protection Act of 2006.   [2:18] Josh explores the regulatory carrots and sticks of EPSA through the eyes of two of its leaders, we begin with Bradfrod Campbell. Brad shares about how he came to shape the world of modern retirement savings as the Assistant Secretary of Labor for Employee Benefits in the United States Department of Labor.   [4:18] The Pension Protection Act was passed while Brad worked as a young Republican, he speaks about his beginnings in the Government and how he found ERISA, enrolled in law school and weathered the Enron scandal.   [8:15] Phyllis Borzy took over Brad’s position as the Assistant Secretary of Labor for Employee Benefits in the United States Department of Labor. She talks about how she was always drawn to law and enrolled the year ERISA passed.   [11:14] Her love for ERISA was cemented after her stay in corporate law and she brought it into her career in government all the way up to what she calls the Gingrich revolution.   [13:45] Brad and phyllis had similar challenges but different approaches. Brad talks about the balancing act between carrot and stick.   [15:09] Josh offers a quick explanation of 404C — a pivotal part of the Accidental Plan Sponsor story as well as the Pension Protection Act. Brad weighs in on the way 404C functions.   [19:14] Phyllis shares her profound hate for 404C, her multiple reasons why and what she would do differently.   [22:25] The Pension Protection Act from Brad’s point of view — both pre and post Enron — and the legal implications that had to be thought over in that context.   [26:15] More carrots! 404C generated a proliferation of offers without much structure for participants to direct their investment, Brad describes how they helped write the QDIA regulation and define 3 mechanisms for an appropriate default investment that would stand the test of time.   [30:00] Brad shares the difficulties of putting regulations in place, from congress to burgeoning lawsuits inter-administration. Phyllis shares her take and the work she did on the regulation, get ready for some bi-partisan agreement!   [34:44] Phyllis takes a moment to denounce the attacks her co-workers received from the nay-sayers.   [35:54] With overwhelming bi-partisan support, the Secure Act was passed in 2019, Josh touches on some of the issues this rule attempts to address. Brad and Phyllis share their joy having worked on ERISA.   [37:48] Josh thanks his guests for sharing their stories and ends with a taste of what episode 7 has to offer.   Thank you for tuning in. If you liked what you heard, please subscribe and leave us a review wherever you listen to your podcasts.   Links: The Accidental Plan Sponsor   Mentioned in this episode: More about Bradford Campbell. More about Phyllis Borzy.

The future of defined contribution retirement savings will always be marked by two key concepts: putting individual investors first when designing plans, and constantly innovating. Over the course of the next four episodes, we’re going to discuss how regulation, litigation, and the role of consultants both support and deter innovation. We’re going to start with two featured guests who laid the foundation for the modern 401(k):     • Brigitte Madrian, who pioneered behavioral economics work on automatic enrollment    • Larry Tint, creator of the Target Date Fund   Key Takeaways: [:29] Josh opens up today’s episode with a quick recap of episode 4 which focused on the work of two innovators in the field. He pursues the series by talking about his  experience and what he believes the very heart of the issues to be — innovation, regulation and consultancies. [4:00] How did Larry Tint — former U.S. CEO of Barclays Global Investors — change the trajectory of the retirement industry? Josh and Larry detail his career trajectory and how it led to meeting the future Nobel prize winner Bill Sharpe and the birth of SharpeTint. [8:00] Most individual investors don’t know how to build investment portfolios! Larry talks about his time at Wells Fargo and his work with Don Luskin to use the technology he created with Bill to the benefit of individuals. The Target Date funds were born. [11:39] The General Motors exception! Also Larry talks about the innovations he didn’t act on or think of and how this might have changed the course of things even further — wheels on suitcases? [15:30] Target date Funds were still being held back, and more innovation was required. Josh introduces Behavioral Economist Brigitte Madrian — ninth Dean of the Marriott School of Business at Brigham Young University (BYU).  [17:10] Behavioral Economics was not a thing when Brigitte began her academic career. She speaks to a life-changing moment in data analysis and the 20 plus years of research this generated! [22:29] So why is auto-enrollment so successful? Brigitte shares what her research points to as well as the kinds of organisations that immediately were on board, and the ones that weren’t. [26:07] The biggest hurdle… Lawsuits! Brigitte talks about the policy makers that got in touch with her and how she helped shape policy. She also shares the pride she feels about her public and academic involvement. [28:55] Larry takes a moment to reflect on his contributions to the retirement landscape. [29:43] Josh thanks his guests for sharing their stories and opens up the discussion on what came after Target Date Funds and automatic enrollment in the retirement planning space. Thank you for tuning in. If you liked what you heard, please subscribe and leave us a review wherever you listen to your podcasts. Links: The Accidental Plan Sponsor Mentioned in this episode: More about Larry Tint. More about William “Bill” F. Sharpe. More about Don Luskin. More about Brigitte Madrian.

Josh reviews the first four full-length episodes of the podcast with long-time friend Mike Barry, President of O3 Plan Advisory Services LLC, who offers his thoughts while also sharing some personal experiences from 40+ years’ in the benefits field. 

Josh engages in an energetic discussion with two colleagues and long-time Defined Contribution (DC) experts David Skinner and Sara Shean from PGIM Real Estate. The discussion covers the evolving DC environment, the challenges facing plan sponsors, and the role of real estate in DC.

In this bonus episode, Ted Benna, who is often dubbed the father of the 401(k) and who was a guest from episode 2, reminisces about the early days of DC plans.  Stories he shares includes a memorable exchange with a future vice presidential nominee about retirement savings, how plans were built and communicated in those days, and blowback he received from some in the industry.

In this bonus episode, Frank Cummings (Guest from Ep.1) shares some key moments from his time on Capitol Hill working closely with the late Senator Jacob Javits. Here, Frank describes how he convinced Senator Javits to push for equal access for women in some crucial areas. He also shared a humorous story about former President Lyndon Johnson following the signing of ERISA. 

If innovating was easy, we would all be Steve Jobs. But it’s not. It disrupts lives, it forces us out of comfort zones, and it requires both inspired vision and a lot of work. No wonder we prize the innovators amongst us. In this episode, we talk with two plan sponsors who embraced innovation in the defined contribution space, Stuart Odell, formerly of Intel, and Bob Hunkeler from International Paper Company. We discuss their work, the challenges they faced, and how they view the future of retirement.   Key Takeaways: [:34] Josh opens up today’s episode with a quick recap of episode three which graded the system and found the innovation lacking. In order to find a way forward, he welcomes 2 plan sponsors who have found bold new solutions to obstacles.   [3:39] Stuart Odell shares a bit about his journey from engineering to getting invested as a Plan Sponsor manager — and talks about the precarious state of the retirement plan as he started looking into it at Intel.   [8:00] Having no preconceived notions about the defined contribution space may have helped Stuart think outside the box. He explains some of the changes he made to the existing structure to align it with the goals and values of the company as a way to gain more flexibility for innovation.   [11:00] Stuart shares his take on why innovation is critical in the retirement space, despite litigation being a huge deterrent. He opens up about the class action lawsuit Intel was served following his changes.   [14:45] Bob Hunkeler has a background in science and had never planned on managing corporate retirement plans. He shares the journey that took him to Switzerland and back to the States with an opening in the pensions department.   [17:40] Bob touches on how the company philosophy has affected the roughly 18 billion dollars in retirement assets he manages. International Paper has both an IP savings plan and a 401k. Bob explains how they construct their portfolios as well as his take on decumulation.   [21:35] Because there was a kind of vacuum in the retirement planning space and as such, Bob’s ideas and innovations were an encouraging way of filling this space. He speaks to his motivation for making headway in this space.   [23:55] Putting their money where their mouth is, International paper provides a complete suite of retirement planning services to its employees. Bob speaks to the continued innovation he tries to drive in the company by building bridges.   [25:44] Bob and Stuart share their takes on the title of the podcast!   [28:46] Josh thanks his guests for sharing their stories and opens up the discussion for further innovation on the corporate side of the retirement planning space.   The Accidental Plan Sponsor will be back this summer! Thank you for tuning in. If you liked what you heard, please subscribe and leave us a review wherever you listen to your podcasts.   Links: The Accidental Plan Sponsor   Mentioned in this episode: More about Stuart Odell on LinkedIn. More about Robert Hunkeler on LinkedIn.

In the first two episodes of this series, we examined the history of the employer-based retirement system. But how is it working out today? The success of the creation and implementation of the employer-based 401(k) and other defined contribution retirement plans is seen not only in its exponential growth in all measurable metrics but also in the fact that it has succeeded in helping millions of Americans retire well. That said, the system, as it’s designed and operating today, is far from perfect, stranding some without access to the tools of a comfortable retirement and discouraging attempts at innovation. In this episode, host Josh Cohen asks respected industry leaders to grade the system on four crucial factors of success: Access, Adequacy, Alignment, and Innovation.  Featured Guests: • Lori Lucas, President & CEO of the Employee Benefit Research Institute (EBRI) • Lew Minsky, President & CEO of the Defined Contribution Institutional Investment Association (DCIIA)   Key Takeaways: [:34] How is the retirement system doing today? To answer this question, your host Josh Cohen recruited some of his long-time friends, who happen to be industry experts.   [2:27] Lori Lucas is the President and CEO of the Employee Benefit Research Institute (EBRI). She shares what they do and how she came to be in this position.   [5:04] Lew Minsky is the President and Chief Executive Officer of the Defined Contribution Institutional Investment Association (DCIIA). He talks about getting bit by the public policy bug and his journey to co-founding the DCIIA.   [8:27] With the help of our experts we’re going to be grading the system according to 4 aspects, red pens out everyone.   [9:24] Grade 1: Access. Lori weighs in with the ERBI research on 401k’s and grades according to organization size. Lew adds a caveat before handing out easy grades here.   [13:29] Grade 2: Adequacy. Lew feels adequacy scores higher than access if one important condition is met, however Lori’s enthusiasm wavers.   [18:00] Grade 3: Alignment. This relates to the sponsor entity’s interest being aligned with the successful retirement of employees. Lori’s grade is linked to the importance of promoting overall employee financial wellness. Lew offers that theory and practice diverge on this front and that there is an elephant in the room...   [24:20] Grade 4: Innovation. DCIIA has been hosting an annual excellence and innovation award, Lew mentions that efforts will need to continue. Both Lew and Lori speak to the elephant of litigation coming back into the room.   [27:48] Lori and Lew weigh in on the podcast name: The Accidental Plan Sponsor!   [29:30] Josh offers a summary of the system, thanks Lew and Lori for their contribution to this episode, and opens up the discussion for episode 4 on how certain plan sponsors challenged the status quo and innovated in the retirement savings space.   Thank you for tuning in. If you liked what you heard, please subscribe and leave us a review wherever you listen to your podcasts. Links: The Accidental Plan Sponsor Mentioned in this episode: More about Lori Lucas, President and CEO of the Employee Benefit Research Institute. More about Lew Minsky, President and CEO of the Defined Contribution Institutional Investment Association.

At 40 years old, the 401(k) has become part of the bedrock of the employer-based retirement system. Tens of millions of Americans have socked away trillions of dollars in a retirement investment vehicle that has fundamentally changed the dynamic of how employers provide a secure retirement for their workers. Today, the 401(k) makes up more than $6.5 of the $9.5 trillion in workplace defined contribution assets. But in 1981, this nascent idea was trying to find its place amongst pension and various savings plans, and it was finding an audience that would propel it to prominence. Host Josh Cohen talks with Ted Benna, father of the 401(k), and Richard Stanger, the author of the 869-word insert to the US tax code that changed retirement.   Key Takeaways: [1:15] Josh Cohen picks up where we left off following the birth of ERISA and welcomes two key players in the creation of the 401k: Richard Stanger and Ted Benna. [3:46] To better understand 401k’s Josh rounds up the history of profit-sharing plans — which is almost as long as the history of the United-States. [6:27] Richard Stenger shares the story of how he came to write the Revenue Act add-on, from President Carter’s election to the entrance of Barber Conable on stage. [11:46] “The beauty of it was that there wasn’t a lot of lobbying. Take a blank sheet of paper, forget the history of pension law: how do we create something that creates a fair distribution of contributions and benefits between rank-and-file employees and highly compensated employees?” — Richard Stanger [13:24] Ted Banner is often referred to as the father of 401k’s, he shares how he came into this title starting with what was called “thrift plans”, Coda Plans and getting a green light on 401k plans in 1981. [19:33] “They took us into a big auditorium and plopped me up in front of 25 of their top tax writers with their crossed arms like” what’s this country hick going to tell us? Less than an hour into the interview it switched over to how can we get that for us?” — Ted Benna [22:10] Ted shares his take — both the good and the bad — on what the employer role is in pension plans, as well as the benefits of the 401k. [24:56] Richard looks back with pride on the legacy of those 869 words he wrote. [26:20] Josh thanks both of his guests and closes out episode 2 of the Accidental Plans Sponsor and shares a teaser on episode 3: looking ahead.   Thank you for tuning in. If you liked what you heard, please subscribe and leave us a review wherever you listen to your podcasts.   Links: The Accidental Plan Sponsor PGIM Follow us on Twitter Mentioned in this episode: Richard Stanger wrote the 869 word add-on to the Revenue Act of 1978. Find him on LinkedIn Ted Benna took Richard Stanger’s idea and ran with it! Find him on LinkedIn

In Part 1 of the premiere episode, we touched on one of the most important events in the history of retirement savings, the collapse of Studebaker in 1963. Today’s guest, Frank Cummings, was back then just beginning his 70-year law career with one of his very first clients…Studebaker.  In Part 2 of this episode, Frank recounts his journey from New York to South Bend, Indiana, to Washington, DC as lead bargainer for the auto company. He recalls his meeting with Senator Jacob Javits, with whom he embarks on a series of ‘Road Shows’ centered on the tragic stories of people losing their pensions, all in the hopes of providing the public with better information around pension reform legislation.    Listen in to this incredible account of policy reform, a journey that spanned four presidents, nearly 50 states, Watergate, and finally, a Rose Garden signing that helped pave the way for the modern retirement system and the regulations Plan Sponsors are still living with today. 

The next time you’re browsing through your 401(k) statement, consider this: If not for the collapse of a once-iconic car company in the 1960s, your retirement plan may look dramatically different.  The history of pensions and retirement savings is a fascinating one. From the impact of world wars, the shift in workforce demographics to squabbling labor unions, organized crime, and, yes, even the demise of the Studebaker, how employers structure retirement plans for their workers is a complex and compelling story. In fact, it’s why we launched our new podcast, The Accidental Plan Sponsor, hosted by PGIM’s head of institutional defined contribution, Josh Cohen.  In Part 1 of the premiere episode, Josh is joined by Professor James Wooten at the University at Buffalo School of Law. During their conversation, Professor Wooten explains a series of crucial events that led to the creation of the Employee Retirement Income Security Act (ERISA) and how employers ultimately became responsible for their employees’ retirement. 

Most retirement benefits for American workers are built up through workplace savings plans where employers play a pivotal administrative and legal role as the Plan Sponsor. PGIM’s new podcast, The Accidental Plan Sponsor™, hosted by Josh Cohen, Head of Institutional Defined Contribution, explores the origins, evolution, and trends within the employer-based retirement system.

Most retirement benefits for American workers are built up through workplace savings plans where employers play a pivotal administrative and legal role as the Plan Sponsor. PGIM’s new podcast, The Accidental Plan Sponsor™, hosted by Josh Cohen, Head of Institutional Defined Contribution, explores the origins, evolution, and trends within the employer-based retirement system.