Message-ID: <29875272.1075860494591.JavaMail.evans@thyme> Date: Mon, 11 Dec 2000 03:11:00 -0800 (PST) From: ann.ballard@enron.com To: michelle.cash@enron.com Subject: Re: Excess OASDI Payments and Withholding Issue Mime-Version: 1.0 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: 7bit X-From: Ann Ballard X-To: Michelle Cash X-cc: X-bcc: X-Folder: \Michelle_Cash_Dec2000\Notes Folders\Notes inbox X-Origin: Cash-M X-FileName: mcash.nsf FYI ----- Forwarded by Ann Ballard/Corp/Enron on 12/11/2000 11:10 AM ----- Rex Rogers 12/11/2000 11:01 AM To: Ann Ballard/Corp/Enron@ENRON cc: Sharon Butcher/Corp/Enron@ENRON, Kriste Sullivan/Corp/Enron@ENRON Subject: Re: Excess OASDI Payments and Withholding Issue Ann: I do not know anything about this---I very quickly glanced at the materials, and what is suggested presents some pretty major issues (Michelle is right---there are tax issues, corporate veil issues, and possibly other technical employee benefit regulatory issues). This is clearly outside of my area of expertise; I think this is probably more in Sharon's, Kriste's and Pat's area. Why don't we discuss this at our staff meeting on Wednesday. If we need to get together sooner, please let me know. Thanks, Rex. Ann Ballard 12/11/2000 09:43 AM To: Rex Rogers/Corp/Enron@Enron cc: Subject: Excess OASDI Payments and Withholding Issue Rex -- Do you know anything about the below described proposal? I do not, and don't know whether I should get involved. ----- Forwarded by Ann Ballard/Corp/Enron on 12/11/2000 09:41 AM ----- Michelle Cash@ECT 12/10/2000 04:28 PM To: Tony Jarrett/Corp/Enron@ENRON, Robert Eickenroht/Corp/Enron@ENRON, Ann Ballard/Corp/Enron@ENRON, fmackin@aol.com cc: Sharon Butcher/Corp/Enron@ENRON, Kriste Sullivan/Corp/Enron@ENRON Subject: Excess OASDI Payments and Withholding Issue Do you have any thoughts/comments on the proposal discussed in the attached email? Basically, the proposal is to create three holding companies that will house all employees of Enron and its subsidiaries/affiliates, and then "lease" the employees to the various business units in which they work. Potential issues I see include tax and corporate veil issues. Your thoughts would be appreciated. Michelle ---------------------- Forwarded by Michelle Cash/HOU/ECT on 12/10/2000 04:25 PM --------------------------- Bob Sparger@ENRON 12/01/2000 02:31 AM To: Sharon Butcher/Corp/Enron@ENRON, Michelle Cash/HOU/ECT@ECT, Kriste Sullivan/Corp/Enron@ENRON cc: Cindy Olson/Corp/Enron@ENRON, Brad Coleman/HOU/ECT@ECT, David O'Dell/HR/Corp/Enron@ENRON, Janice Priddy/HR/Corp/Enron@ENRON Subject: Excess OASDI Payments and Withholding Issue Sharon / Michelle / Kriste: In late September, I sent a note on excess OASDI payment by Enron and excess OASDI withholdings from employees when U. S. domestic employee transfers occur between Enron BUs but never received a response - note David O'Dell's e-mail below. Understand Enron has looked at this area before, but feel we should look again to see if there are any viable alternatives to the current situation. Could you please look at the attachment in my original e-mail (below) and let us know where we stand.how to proceed? Thanks, Bob ---------------------- Forwarded by Bob Sparger/Corp/Enron on 12/01/2000 08:26 AM --------------------------- From: David O'Dell 11/30/2000 04:17 PM To: Bob Sparger/Corp/Enron@Enron cc: Janice Priddy/HR/Corp/Enron@ENRON Subject: Excess OASDI Payments and Withholding Issue Bob, Janice and I met with E&Y Tax Services today to discuss a number of topics including potential organizational structural modification strategies. One strategy discussed was very similar to the proposal you made back in September. We are planning to have the E&Y folks come back in to discuss these ideas in more detail. A couple of questions for you come to mind: Did you ever get a response from Legal and/or Tax on your proposal? Would you like to attend the next meeting with E&Y? Please let me know your thoughts... Thanks - David ---------------------- Forwarded by David O'Dell/HR/Corp/Enron on 11/30/2000 04:13 PM --------------------------- Bob Sparger 09/29/2000 11:11 AM To: Sharon Butcher/Corp/Enron@ENRON, Michelle Cash/HOU/ECT@ECT, Kriste Sullivan/Corp/Enron@ENRON cc: Cindy Olson/Corp/Enron@ENRON, Brad Coleman/HOU/ECT@ECT, David O'Dell/HR/Corp/Enron@ENRON Subject: Excess OASDI Payments and Withholding Issue Sharon / Michelle / Kriste: The enclosed document addresses excess OASDI payment by Enron and excess OASDI withholdings from employees when U. S. domestic employee transfers occur between Enron BUs. The current situation results in significant Enron excess OASDI payment annually, and creates issues with employee due to overwithholding resulting in employee complaints and ill will towards HR, Payroll, and Enron. The document depicts apparent options, and a potential solution, to the current situation. This is viewed as an HR customer service issue to ensure Enron employees receive the best overall service possible in their interface to the HR function and systems. It is my understanding that Enron Executive Management feel that employee transferability among the BUs is important, and wishes to see more movement of employees (as well as thoughts and ideas) between the BUs in the future to enhance employee opportunities and Enron's value. This being the case, I would expect the Enron cost and employee impacts and issues to be acerbated as additional and increased employee movement occurs in the future. We need Legal review of the issues and opportunities as presented in the document to determine a solution to the current - and pending future - situation, and look forward to any guidance you can provide in resolving the problems the current situation creates for Enron employees who transfer between Enron entities within a tax year and to mitigate potential future issues. If there is not a Legal obstacle, we will then go to Tax to address the specific tax entity issues. Regards, Bob