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Archived News Release--Caution:
information may be out of date.
For more information call: (202) 219-8921
Today, Assistant Secretary of Pensions and Welfare Benefits
Administration Olena Berg reminded employee benefit plan administrators and
service providers of the need for action to address the looming Year 2000
software problem in order to protect workers' benefits as the century turns.
The problem -- computer software that recognizes years only by the last
two digits -- is widespread and difficult to fix because datelines are buried
throughout interlocking software applications and programs. Any computerized
tasks requiring date-dependent computations or comparisons, such as computing
interest, determining length of service or calculating retirement benefits,
will be affected. The problem involves not only plan record-keeping systems,
but also such systems as employer payrolls that interface with plans and whose
performance is essential to plan operation.
"This is a cybernetic minefield that will take considerable time and
effort to clear," warned Berg. "No ready technological solution has emerged,
and experts agree it is unlikely that one will. Therefore, plan administrators
and service providers cannot afford to gamble on a last-minute, technological
fix. They must act now."
Berg stressed that plan administrators have a fiduciary responsibility
to see that the Year 2000 problem is addressed. If they have not already done
so, she noted, plan administrators should take steps immediately to identify
the computer systems needed for plan operations, determine who is responsible
for those systems and establish procedures for assuring that workable
strategies are in place to address the Year 2000 problem.
In many instances, service providers to plans will have legal
responsibility under existing licenses, agreements or maintenance contracts to
participate in solving the problem. "In the end," Berg said, "it is the plan
administrator's responsibility to be certain that their service providers are
on top of the problem."
Archived News Release--Caution:
information may be out of date.
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