DOE Abandons Proposal to Restrict Defined Benefit Reimbursements to Contractors

The U.S. Department of Energy (DOE) has decided to drop a controversial proposal to stop reimbursing contractors for new employees' defined benefit coverage. The proposed policy would have limited reimbursements for contractors' new employees to defined contribution benefits, required new employees' pension and medical benefits to meet market-based performance benchmarks and restricted the availability of lump sum distributions.

In March, the DOE asked for comments on the proposed policy (see Watson Wyatt Insider, May/June 2007), and many of the responses were negative. Apparently responding to those comments, the DOE decided not to implement the policy.