M-16_Signed_Mod_470.pdf

2/6/2017

Contract Number DE-AC27-08RV14800 Continuation Pages, Modification 470

Continuation of Block 14. Description of Amendment/Modification

1. Contract Section H.2, Employee Compensation: Pay and Benefits, (h)(6)(ii) is being revised at no cost to the government. The change is as follows.

FROM:

Separate Employee Benefits Cost Study comparisons are annually required for all plans identified in paragraph (a). An Employee Benefits Cost Study is a study which analyzes the Contractor’s employee benefits cost on a per capita per full time equivalent employee basis and as a percent of payroll and compares them with the costs reported by the U.S. Department of Labor’s Bureau of Labor Statistics or other Contracting Officer approved, broad based, national survey.

TO:

Separate Employee Benefits Cost Study comparisons are annually required for all plans identified in paragraph (a). An Employee Benefits Cost Study is a study which analyzes the Contractor’s employee benefits cost for employees as a percent of payroll and compares it with the cost as a percent of payroll, including geographic factor adjustments, reported by the U.S. Department of Labor’s Bureau of Labor Statistics or other Contracting Officer approved, broad based, national survey.

2. Contract Section H.2, Employee Compensation: Pay and Benefits, (h)(8) is being revised at no cost to the government. The change is as follows.

FROM:

When the average total benefit per capita cost or total benefit cost as a percent of payroll exceeds the comparator group by more than 5%, and if required by the Contracting Officer, the Contractor shall submit an analysis of the specific plan costs that are above the per capita cost range or total benefit cost as a percent of payroll and a corrective action plan to achieve conformance with a Contracting Officer directed per capita cost range or total benefit cost as a percent of payroll, unless waived in writing by the Contracting Officer.

TO:

When the total benefit cost as a percent of payroll exceeds the comparator group by more than 5%, when and if required by the Contracting Officer, the Contractor shall submit an analysis of the specific plan costs that result in or contribute to the percent of payroll exceeding the costs of the comparator group and submit a corrective action plan if directed by the Contracting Officer.

Continuation Pages, Modification 470

3. Contract Section H.2, Employee Compensation: Pay and Benefits, (h)(9) is being revised at no cost to the government. The change is as follows.

FROM:

Within two (2) years of approval of the Contractor's corrective action plan by the Contracting Officer, the Contractor shall implement corrective action plans to align employee benefit programs with the benefit value and per capita cost range or percent of payroll as approved by the Contracting Officer.

TO:

Within two (2) years of approval of the Contractor's corrective action plan by the Contracting Officer, the Contractor shall implement corrective action plans to align employee benefit programs with the benefit value and the cost as a percent of payroll as approved by the Contracting Officer.

4. Contract Section H.2, Employee Compensation: Pay and Benefits, (h)(19) is being revised at no cost to the government. The change is as follows.

FROM:

Contractors shall submit new benefit plans and changes to plan design or funding methodology with justification to the Contracting Officer for approval, as applicable (see (h)(4) above). The justification must:

(i) demonstrate the effect of the plan changes on the contract net benefit value or per capita benefit costs,

(ii) provide the dollar estimate of savings or costs, and

(iii) provide the basis of determining the estimated savings or cost.

TO:

Contractors shall submit new benefit plans and changes to plan design or funding methodology with justification to the Contracting Officer for approval, as applicable (see (h)(4) above). The justification must:

(iv) demonstrate the effect of the plan changes on the contract net benefit value or percent of payroll benefit costs,

(v) provide the dollar estimate of savings or costs, and

(vi) provide the basis of determining the estimated savings or cost.

5. All other terms and conditions remain unchanged.

Modification 470

ATTACHMENT

Replacement Pages

Total: Three (3) pages including this cover page

Contract Section H.2, Employee Compensation: Pay and Benefits, pages H-7 and H8.

Tank Operations Contract Section H Contract No. DE-AC27-08RV14800 Modification No. 470

H-7 and Contracting Officer approved survey sources; and,

(ii) Separate Employee Benefits Cost Study comparisons are annually required for all plans identified in paragraph (a). An Employee Benefits Cost Study is a study which analyzes the Contractor’s employee benefits cost for employees as a percent of payroll and compares it with the cost as a percent of payroll, including geographic factor adjustments, reported by the U.S. Department of Labor’s Bureau of Labor Statistics or other Contracting Officer approved, broad based, national survey.

(7) When net benefit value exceeds the comparator group by more than five

(5) percent (%), the Contractor shall submit a corrective action plan to the Contracting Officer for approval, unless waived in writing by the Contracting Officer.

(8) When the total benefit cost as a percent of payroll exceeds the comparator group by more than 5%, when and if required by the Contracting Officer, the Contractor shall submit an analysis of the specific plan costs that result in or contribute to the percent of payroll exceeding the costs of the comparator group and submit a corrective action plan if directed by the Contracting Officer.

(9) Within two (2) years of approval of the Contractor's corrective action plan by the

Contracting Officer, the Contractor shall implement corrective action plans to align employee benefit programs with the benefit value and the cost as a percent of payroll as approved by the Contracting Officer.

(10) The Contractor may not terminate any benefit plan during the term of the

Contract without prior approval of the Contracting Officer in writing.

(11) Cost reimbursement for Post Retirement Benefits (PRBs) is contingent on the specific terms of the plans identified in paragraph (a), as amended. Unless required by Federal or State law, advance funding of PRBs is not allowable.

(12) All costs of administration shall be costs of each plan individually and allocated to participating plan sponsors. Costs of administration shall be directly billed to the plans and not charged by indirect allocation.

(13) The Contractor shall maintain a sufficient number of trained and qualified personnel to perform all of the functions of the plans.

(14) The Contractor shall render all ordinary and normal administrative services and functions which may be reasonably required. The Contractor shall annually provide an itemization of costs incurred for plan administration for each plan to the Contracting Officer within 60 days of the end of each plan year.

(15) The Contractor shall manage Plan assets in a prudent manner. The Contractor shall develop and submit to the Contracting Officer an Investment Policy Statement for each plan that clearly defines investment return objectives and risk tolerances, and shall perform annual pension plan Investment Performance Self-Assessments.

The Contractor performance self-assessments shall address investment objectives, development of the plans to achieve investment objectives, execution of

Tank Operations Contract Section H Contract No. DE-AC27-08RV14800 Modification No. 470

H-8 the plans, performance monitoring, and appropriate corrective action planning and execution. The Contractor shall provide the Contracting Officer with a copy of each plan’s Investment Performance Self-Assessment.

(16) The Contractor shall comply with the Investment Policy Statements developed for the plans. Should the Contractor incur higher costs because the Contractor fails to comply with all or part of the established Investment Policy Statements provided to DOE, the additional costs incurred are unallowable.

(17) Each Contractor sponsoring a defined benefit pension plan and/or postretirement benefit plan will participate in the annual plan management process which includes written responses to a questionnaire regarding plan management, providing forecasted estimates of future reimbursements in connection with the plan(s) and participating in a conference call to discuss the Contractor submission (see (i)(8) below for Pension Management Plan requirements.

(18) Each Contractor will respond to quarterly data calls issued through iBenefits, or its successor system.

(19) Contractors shall submit new benefit plans and changes to plan design or funding methodology with justification to the Contracting Officer for approval, as applicable (see (h)(4) above). The justification must:

(i) demonstrate the effect of the plan changes on the contract net benefit value or percent of payroll benefit costs,

(ii) provide the dollar estimate of savings or costs, and

(iii) provide the basis of determining the estimated savings or cost.

(i) Establishment and Maintenance of Pension Plans for which DOE Reimburses Costs

(1) The Contractor shall comply with the requirements of ERISA if applicable to the pension plan and any other applicable laws.

(2) Employees working for the Contractor shall only accrue credit for service under this Contract after the date of Contract award.

(3) Any pension plan maintained by the Contractor, for which DOE reimburses costs, shall be maintained as a separate pension plan distinct from any other pension plan which provides credit for current service not previously paid through a DOE cost reimbursement contract.

(4) The following reports shall be submitted to DOE as soon as possible after the last day of the plan year by the Contractor responsible for each designated pension plan funded by DOE but no later than the dates specified below:

(i) Actuarial Valuation Reports. The annual actuarial valuation report for each DOE-reimbursed pension plan and when a pension plan is commingled, the Contractor shall submit separate reports for DOE’s portion and the plan total by the due date for filing IRS Form 5500.