Friday, June 1, 2012

Retroactive Pension Legislation

Here is a reprint of a Pension Alert from my colleague Priscilla Healy:

Buried deep within the federal Omnibus Budget Implementation Bill is a provision
amending the Pension Benefit Standards Act, 1985 (PBSA). Section 483 of the
Bill gives retroactive effect to July 27, 2004 to two sections of the PBSA. Those
provisions have the effect of legitimizing regulations made under those sections
almost eight years ago.
Presumably there is some specific situation or situations that section 483 seeks
to address. What it/they might be, I have no idea. It was eight years ago. Section
483 may be, and probably is, totally innocuous.
Why does this apparently minor matter merit our attention? Because we should
all be concerned with legislation that has retroactive effect that is introduced without
clear or obvious explanations or justification given, and should be particularly
concerned when regulations are given retroactive effect in this indirect manner.
First, retroactive legislation can obviously be simply unfair to those who relied on
the former legislation. Secondly, the reasons for retroactive legislation should be
transparent. Thirdly, legitimizing existing regulations by way of amendments to
empowering statutes having retroactive effect leads to confusion. If regulations
have retroactive effect, they are expected to state so clearly within the regulation
Section 483 is a bad legislative precedent. Law should not be made in this way.
Priscilla H. Healy

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