PBGC to Protect Pensions at Murray Inc.
FOR IMMEDIATE RELEASE
January 19, 2005
WASHINGTON-The Pension Benefit Guaranty Corporation today announced it will assume responsibility for the pensions of about 4,500 workers and retirees of Murray Inc., a maker of outdoor power equipment based in Brentwood, Tenn.
"The PBGC is stepping in because Murray's two pension plans face abandonment after the company liquidates," said PBGC Executive Director Bradley Belt. "The PBGC will pay retirees' monthly benefit checks without interruption, up to legal limits, and will ensure other employees receive benefits when they are eligible to retire."
Murray Inc. filed for bankruptcy protection on November 8, 2004. The bankruptcy court will hear a motion to approve the sale of Murray's assets on Jan. 20. In the event that an asset purchaser assumes the company's pension plans and makes up the missed contributions, PBGC would withdraw its notice of intent to terminate the plans.
The Murray Inc. Pension Plan for Hourly Paid Employees and The Murray Inc. Employees' Retirement Fund Plan are 53 percent funded, with $131 million in assets to cover $246 million in promised benefits. The PBGC estimates it will be liable for about $103 million of the $115 million shortfall. The pension plans ended as of January 19, 2005.
Under federal pension law, the maximum guaranteed pension at age 65 for participants in plans that terminate in 2005 is $45,613.86 per year. The maximum guaranteed amount is lower for those who retire earlier or elect survivor benefits. In addition, certain early retirement subsidies and benefit increases made within the past five years may not be fully guaranteed.
After the PBGC becomes trustee of the Murray Inc. pension plans, expected within several weeks, the agency will send trusteeship notification letters to all plan participants. Until then, participants with questions about benefits or who wish to retire should contact the company's pension plan administrator. Those with questions about the pension insurance program may consult the PBGC Web site, www.pbgc.gov or call toll-free at 1-800-400-7242. For TTY/TDD users, call the federal relay service toll-free at 1-800-877-8339 and ask for 800-400-7242.
The PBGC is a federal corporation created under the Employee Retirement Income Security Act of 1974. It currently guarantees payment of basic pension benefits earned by 44 million American workers and retirees participating in over 31,000 private-sector defined benefit pension plans. The agency receives no funds from general tax revenues. Operations are financed largely by insurance premiums paid by companies that sponsor pension plans and by investment returns.
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PBGC No. 05-19