Assignment 1 Essay

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HRMT 208 Assignment 1 Question 1 Plan A-Negotiated Type of pension plan would be a hybrid plan. Can you elaborate/provide some information about why you chose a hybrid plan for Plan A? What were the features of the employee group that led you to this plan type? It would be described under the profit sharing plan which would link the contribution of Tundra to the amount of profitability of the company. Contribution of employees is permitted and will be used for retirement purposes. Tundra will contribute 2% of employee earnings for this plan. The employee can contribute up to 6% of each pay period. This plan will not integrate with any government benefits. You must be vested to receive benefits. You must have…show more content…
Your benefits after retirement will be given out annually for the first 5 years. So you will earn 2% of what you made for the first 5 years at Tundra and then you can choose to take out all your benefits at once after 5 years. You may also choose to keep the benefits coming annually as well. These were both good, in that you seemed to put the design into your own words. You just need to justify why the provisions were different between the plans because it’s not clear why you chose each one. Question 2 A) Defined benefit plans are attractive to employees because they protect them from interest rates pr changes in asset values. They also make sure that retirement income will have a similarity to income they earned while still working. Defined benefit plans also do a better job of protecting against inflation and provide other retirement related benefits. These plans can also present risks for sponsoring employers. These risks with the defined benefit plan our greater than the risks with the defined contribution plans. What are these risks? Also contributions made by employers might be actually smaller then they are to defined benefit plans. B) Public policy should promote and try to protect defined benefit plans as much as possible. Unionized workers who usually who these plans usually cover have more rights than non union members. Also this is more the public sector which can have other retirement benefits. Changes in public policy

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