Labor Secretary Elaine L. Chao Says Americans Deserve Choice, Confidence and Control in Retirement Security

Archived News Release — Caution: Information may be out of date.

WASHINGTON –U.S. Labor Secretary Elaine L. Chao today testified before the House Committee on Education and the Workforce, outlining the President's proposal to protect workers' retirement security.

"The President's proposal will help those saving for retirement by giving workers more choice, confidence and control over their retirement plans," said Chao.

"Americans deserve the choice of how to invest retirement savings in ways that work best for them. While it may be tempting to set arbitrary limits on how much company stock a worker can hold, this would hurt workers by taking away their right to choose."

"But choice by itself won't ensure the security of workers' retirement savings. People need the confidence in investment decisions that come from getting the best financial assistance possible."

The President's plan incorporates Chairman John Boehner's Retirement Security Advice Act, which passed the House with an overwhelming bipartisan majority. The bill encourages employers to make investment advice available to employees by giving them access to professional financial advisors.

"Finally, Americans deserve the same degree of control over retirement savings that any other worker would receive - from senior executives to rank-and-file employees. They need to have ample opportunity to make investment changes before a blackout period begins. They must be guaranteed that their employers will be held to the highest standards of conduct, and that employers will act solely in their interest during a blackout period."

The President's proposal requires that workers be notified a full 30 days in advance that a blackout period will be imposed. The plan will also prevent corporate officers from selling or purchasing any company stock while workers are prohibited from trading in their 401(k) plans during a blackout.

Forty-two million Americans have 401(k) accounts through their employers, owning a total of $2 trillion in assets.

The Department of Labor currently has an open investigation into Enron's pension plan management. The Dallas office of the Department's Pension and Welfare Benefits Administration opened the investigation on November 16th, before Enron's bankruptcy filing. A team of Department of Labor investigators is reviewing Enron's benefit plans, the rules that govern them and steps that were taken shortly before its collapse to temporarily freeze trading of 401(k) plan assets.

Archived News Release — Caution: Information may be out of date.