BIG WHITE HOUSE RETIREMENT CONFAB AN APT SWAN SONG FOR WORKER ADVOCATE: LABOR’S OLENA BERG SAW EDUCATIONAL NEED

This week, more than 200 pension experts gather in Washington for the first White House conference on retirement savings. Helping to organize the event on behalf of the Clinton administration is Assistant Labor Secretary E. Olena Berg, who has done more to ensure workers are financially prepared for their retirement than any of her predecessors.

But Ms. Berg is leaving at the end of this month to marry and move to the Milwaukee area.

Her biggest accomplishment during her five years as head of the department’s Pension and Welfare Benefits Administration has been to goad companies into educating workers on the need for saving for retirement.

liability fears allayed

Until 1996, when the department issued new guidelines, company officials feared that giving employees such help would make them liable if workers’ investments blew up.

Also under Ms. Berg’s leadership, employer groups formed the American Savings Education Council and launched a formal campaign in 1996 to help workers financially prepare for old age.

“We are at a point where everyone is now talking about retirement savings. Olena Berg did a lot to initiate what has become a very important national discussion on how Americans obtain retirement income security,” says Rep. Earl Pomeroy, D-N.D., who has worked closely with the Labor Department on several legislative initiatives.

Mark J. Ugoretz, president of the Washington-based ERISA Industry Committee, agrees: “Her interest in employee education, and her development of a program to encourage employers and service providers to make sure participants understood the value of education, will have an ongoing impact.”

As part of Ms. Berg’s efforts to educate investors, the department last fall held a hearing to shed more light on 401(k) plan fees, and intends to issue a booklet to help workers figure out what kinds of fees they’re paying for investment management and plan administration.

Gina Mitchell, a lobbyist with the Financial Executives Institute’s Committee on Investment of Employee Benefit Assets, commends Ms. Berg for her efforts in educating investors: “That is part of the continuum (of her efforts) on 401(k) plan education — giving people information so they can make an informed decision.”

In the five years Ms. Berg has overseen 700,000 private pension plans with $3.5 trillion in assets, the welfare of workers participating in the employer-sponsored plans has driven many of her policy initiatives, observers note.

faster deposits mandated

Her efforts, beginning in December 1995, to crack down on employers who misused employee contributions to 401(k) plans — and to issue rules to speed up the deposit of employee contributions to such plans — were notable.

Observers say when employers declared the Labor Department’s proposal to shorten the time they had to deposit contributions was unworkable, Ms. Berg’s biggest strength — consensus building –came to the fore.

“She always listened” to employers, says Randolf H. Hardock, partner at the Washington law firm of Davis & Harman. He worked closely with the Labor Department in efforts leading to the enactment of the Retirement Protection Act of 1994 and was benefits tax counsel at the Treasury Department during President Clinton’s first term.

“When it became clear (the rule on 401[k] plan deposits) went too far, she listened and then the Labor Department modified the proposed regulation to make it work,” he says.

That ability to listen to all sides of an issue made her “one of the more effective administration heads there have ever been,” Mr. Hardock says.

Stephen W. Kraus, chief counsel of pensions at the American Council of Life Insurance in Washington, praises Ms. Berg’s efforts to “accommodate not only our views, but other people’s views on issues that she was in charge of.”

Mr. Kraus enlisted the help of the Labor Department four years ago to ease the effect of a December 1993 Supreme Court decision that subjected life insurance companies to federal pension law for some of their pension plan assets. Department support was instrumental in the industry’s ability to win passage of a law requiring it to give guidance to insurance companies on managing the pension fund assets.

Although the council has opposed the proposed regulation on that issue, Mr. Kraus notes the Labor Department was “extremely helpful” in passage of the law.

Crain News Service