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[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[S. 1300 Introduced in Senate (IS)]

106th CONGRESS
  1st Session
                                S. 1300

To amend the Internal Revenue Code of 1986 and the Employee Retirement 
     Income Security Act of 1974 to prevent the wearing away of an 
employee's accrued benefit under a defined benefit plan by the adoption 
      of a plan amendment reducing future accruals under the plan.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                             June 29, 1999

  Mr. Harkin introduced the following bill; which was read twice and 
                  referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL

 
To amend the Internal Revenue Code of 1986 and the Employee Retirement 
     Income Security Act of 1974 to prevent the wearing away of an 
employee's accrued benefit under a defined benefit plan by the adoption 
      of a plan amendment reducing future accruals under the plan.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Older Workers Pension Protection Act 
of 1999''.

SEC. 2. PREVENTION OF WEARING AWAY OF EMPLOYEE'S ACCRUED BENEFIT.

    (a) Amendment to Internal Revenue Code.--Section 411(d)(6) of the 
Internal Revenue Code of 1986 (relating to accrued benefit may not be 
decreased by amendment) is amended by adding at the end the following 
new subparagraph:
                    ``(D) Treatment of plan amendments wearing away 
                accrued benefit.--
                            ``(i) In general.--For purposes of 
                        subparagraph (A), a plan amendment adopted by a 
                        large defined benefit plan shall be treated as 
                        reducing accrued benefits of a participant if, 
                        under the terms of the plan after the adoption 
                        of the amendment, the accrued benefit of the 
                        participant may at any time be less than the 
                        sum of--
                                    ``(I) the participant's accrued 
                                benefit for years of service before the 
                                effective date of the amendment, 
                                determined under the terms of the plan 
                                as in effect immediately before the 
                                effective date, plus
                                    ``(II) the participant's accrued 
                                benefit determined under the formula 
                                applicable to benefit accruals under 
                                the current plan as applied to years of 
                                service after such effective date.
                            ``(ii) Large defined benefit plan.--For 
                        purposes of this subparagraph, the term `large 
                        defined benefit plan' means any defined benefit 
                        plan which had 100 or more participants who had 
                        accrued a benefit under the plan (whether or 
                        not vested) as of the last day of the plan year 
                        preceding the plan year in which the plan 
                        amendment becomes effective.
                            ``(iii) Protected accrued benefit.--For 
                        purposes of this subparagraph, an accrued 
                        benefit shall include any early retirement 
                        benefit or retirement-type subsidy (within the 
                        meaning of subparagraph (B)(i)), but only with 
                        respect to a participant who satisfies (either 
                        before or after the effective date of the 
                        amendment) the conditions for the benefit or 
                        subsidy under the terms of the plan as in 
                        effect immediately before such date.''
    (b) Amendment of ERISA.--Section 204(g) of the Employee Retirement 
Income Security Act of 1974 is amended by adding at the end the 
following new paragraph:
    ``(4)(A) For purposes of paragraph (1), a plan amendment adopted by 
a large defined benefit plan shall be treated as reducing accrued 
benefits of a participant if, under the terms of the plan after the 
adoption of the amendment, the accrued benefit of the participant may 
at any time be less than the sum of--
            ``(i) the participant's accrued benefit for years of 
        service before the effective date of the amendment, determined 
        under the terms of the plan as in effect immediately before the 
        effective date, plus
            ``(ii) the participant's accrued benefit determined under 
        the formula applicable to benefit accruals under the current 
        plan as applied to years of service after such effective date.
    ``(B) For purposes of this paragraph, the term `large defined 
benefit plan' means any defined benefit plan which had 100 or more 
participants who had accrued a benefit under the plan (whether or not 
vested) as of the last day of the plan year preceding the plan year in 
which the plan amendment becomes effective.
    ``(C) For purposes of this paragraph, an accrued benefit shall 
include any early retirement benefit or retirement-type subsidy (within 
the meaning of paragraph (2)(A)), but only with respect to a 
participant who satisfies (either before or after the effective date of 
the amendment) the conditions for the benefit or subsidy under the 
terms of the plan as in effect immediately before such date.''
    (c) Effective Date.--The amendments made by this section shall 
apply to plan amendments adopted after June 29, 1999.
                                 <all>
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