June 2, 2010
Frank J. Del Gaudio, Risk Manager
County of Essex
Hall of Records, Room 510
465 Dr. Martin Luther King, Jr. Blvd.
Newark, NJ, 07102
Re: Resolution #5
Deferred Compensation Plans
Dear Mr. Del Gaudio:
Having reviewed Resolution #5 of the public meeting agenda of May 26, 2010 of the Essex County Board of Chosen Freeholders, CWA Local 1081 respectfully requests your response to the following concerns our Union harbors in that exact regard.
Within your attached memorandum of April 15, 2010 to Essex County Administrator Joyce Wilson Harley you recommended that the Freeholder Board “approve a contract with AXA Equitable Life Insurance Company and Lincoln Financial Services for a period of three years with two three-year renewal options beginning June 1, 2010 through May 31, 2013” for those companies to manage County employees’ voluntarily deferred compensation plans.
Within your memorandum you asserted that “Providers of deferred compensation services must be included on the list of providers currently in good standing with the New Jersey Division of Local Government Services dated June 5, 2009. Both Lincoln Financial Group and AXA Equitable Life Insurance Company have met the review and approval requirements of the New Jersey Division of Local Government Services”. You asserted as well that “The proposal presented by Metropolitan Life Insurance Company was disqualified due to a lack of New Jersey Business Registration Certificate”. Yet, you further asserted that “Metropolitan Life will be permitted to continue to administer established County accounts; however, they will not be permitted in new enrollee activities with County employees”.
The documents attached to your memorandum include the Division of Local Government Services Providers of Deferred Compensation Services (Updated June 5, 2009) which cites Metropolitan Life as part of “a list of deferred compensation providers currently in good standing with the Division of Local Government Services”. Our Union’s Internet research revealed that Metropolitan Life is also on the Division of Local Government Services’ approved list updated March 23, 2010.
Your memorandum asserted as well that “As of September 1, 2009, 1,227 employees participated in the Metropolitan Life plan” for a total of $190,000 in bi-weekly payroll deductions with only 242 employees in the Lincoln plan for a total of $30,000. “Total assets in the Deferred Compensation Plans as of September 1, 2009 were approximately $90 million with 1,474 accounts for active and terminated employees”.
Finally, your memorandum asserted that “All current participant accounts will not be transferred to the new provider(s). Transfer of accounts will be at the discretion of the individual participants”.
Considering the comparatively large number of current and former employees enrolled within the Metropolitan Life Plan, which is inclusive of current and former members of CWA Local 1081, our Union is concerned regarding the County’s decision to at once preclude Metropolitan Life from consideration for contracts for possibly the next nine (9) years based apparently upon a technical fault found with the company’s RFP response while allowing the company to “continue to administer established County accounts”.
At the very least, CWA Local 1081 maintains it incumbent upon Essex County Executive Joseph DiVincenzo to summon representatives from the Unions representing County employees to a Labor/Management Roundtable so that the representatives may be informed of the abovementioned developments. That way, those Union representatives may respectively elect to share the information with their affected members so that the latter may make optimal choices regarding their voluntarily deferred compensation plans.
Sincerely,
David H. Weiner, President
CWA Local 1081