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Pension information is key to planning


Washington Redskins running back Earnest Byner and five other professional football players went to court last month to force the National Football League to tell them what retirement benefits they earned in the 1989 and 1990 seasons.

Although a new NFL retirement plan has been in effect for 22 months, players were never told how much they earned in benefits, and even permanently injured players who had retired in those years were not advised that they could make claims against the plan, said Joseph A. Yablonski, the lawyer who filed the unusual suit in District of Columbia federal court.

"I've never had to sue to get this information before," Mr. Yablonski said. "Whether it is the NFL or Black & Decker, a retirement plan is obligated by law to let participants know what their benefits will be."

Continuing legal battles between NFL players and owners over pension contributions, antitrust laws and other issues certainly helped to turn a simple request into a suit.

But the suit also illustrates how difficult it can be for employees -- even those earning mega-salaries on the football field -- to get information about retirement benefits to which they are entitled under the 1974 Employee Retirement Income Security Act.

About 55 million Americans are covered by more than 800,000 private pension plans, which are a major source of retirement income. Private-employer pension plans had more than $1.4 trillion in assets last year -- about the amount of the federal budget. So the stakes are not insignificant.

"Find out all you can about your pension," advises Timothy Roof of Hewitt Associates, a benefits consulting firm. In order to plan for the future, know how the plan works, when vesting occurs, what benefits you can expect and when the benefits will begin, he emphasizes.

Even though company publications may describe the structure of your pension plan, you should be interested in the details of pension benefits you have earned. Those calculations can require more than a quick look at the computer.

When 1,200 Westinghouse Electric Corp. employees in Maryland were laid off this month, many were disturbed by a lack of specifics about pension benefits. For discharged employees with 25 or 30 years service, pension payment data were essential to planning their futures.

"I can't determine what I'm going to do until I know what I'm entitled to," Ronald Castle groused after he failed to find out his pension payments from company counselors.

Under federal pension law, you're entitled to information about their retirement benefits -- even years before you expect to retire. Experts recommend determining the provisions of your pension plan well in advance to make plans for retirement and to gauge the need for supplemental savings or income.

The plan's administrator (usually in the company personnel office) is required by law to provide participants with certain information:

* You're entitled to an individual benefit statement, detailing the benefits you have earned to date and whether you have a permanent, or vested, right to receive them. Full vesting is achieved after five years for most single-employer plans, according to federal law, although benefits may be earned before that time.

If the employer does not automatically provide this statement, you must request it in writing from the plan administrator. The plan is only required to provide the statement once a year.

(Although not required by law, many employers will provide a projection of the monthly benefit you will receive at retirement age. That's more valuable for your planning, Mr. Roof said, so ask for it.)

* Employers are required to distribute to all employees a Summary Plan Description within 120 days of the pension plan's creation or 90 days after you become a participant. If denied, you can sue for the information and ask $100 a day in penalties, as the football players are doing.

* Employers also are required to file an annual report with the federal government describing the financial condition of their retirement plans and to provide a summary of that report to plan participants. You have a right to get a copy of the full annual report if you pay copying charges. You also can look at the report at the company office or at the Labor Department in Washington.

The nation's 50 largest under-funded pension plans have a potential combined shortfall of more than $14 billion, the government's Pension Benefit Guaranty Corp. reported recently. Among those plans are four of Maryland's largest employers: Allied-Signal Inc., Bethlehem Steel Corp., General Motors Corp. and Westinghouse.

That's the bad news.

The good news: Many companies on the list will have no difficulty meeting pension obligations, according to the federal agency. Many with under-funded pension plans can easily make payments to current retirees but simply haven't yet set aside money needed to pay off all vested workers in the future.

And even if the companies stumble, basic pension benefits are guaranteed by the 17-year-old government agency.

* You can get survivor coverage data, which details information about pension plan coverage affecting you and your spouse. Plans that make a monthly payment to retirees have to provide survivor benefits. Your spouse will automatically receive benefits you die, unless both of you decline that option in writing.

If your employer does not provide the required information, the Labor Department can help. Write the Division of Technical Assistance and Inquiries, Pension and Welfare Benefits Administration, 200 Constitution Avenue NW, Washington, D.C. 20210.

Social Security is also required to provide a statement of wages reported for you since 1950 and an estimate of retirement benefits to be paid at age 65, or at age 62, if requested. Form SSA-7004 to request the personal report is available by calling 1-800-234-5772.

"Your Pension," a booklet explaining pension plans and participant rights is available from the Pension Benefit Guaranty Corp. For a copy, write to PBGC, 2020 K Street NW, Washington, D.C. 20006.

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