PBGC Moves to Protect Pensions at Relizon Co.
FOR IMMEDIATE RELEASE
February 18, 2011
WASHINGTON-The Pension Benefit Guaranty Corporation (PBGC) today announced it is stepping in to protect the underfunded pension plan covering nearly 2,500 employees and retirees of The Relizon Company, a producer of commercial marketing materials based in Dayton, Ohio.
The PBGC, which safeguards the pensions of 44 million Americans, acted because Relizon and its parent company Workflow Management Inc. of Norfolk, Va., are liquidating in bankruptcy. After the assets of Relizon, Workflow Management and other affiliates are sold off, no entity will remain to fund or manage the pension plan, leaving the PBGC to pay almost $55 million in unfunded benefits.
By taking action before the asset sale, the PBGC is better positioned to recover pension funding from the assets of Workflow Management and its group of companies. Otherwise, the agency's ability to recover funds for the pensions of Relizon workers would be severely diminished.
Relizon's pension plan has $49 million in assets to cover $104.4 million in benefit liabilities, according to the PBGC. The agency expects to cover $54.7 million of the $55.4 million shortfall, which will be reported in its 2011 financial statement.
The PBGC will take over the assets and use insurance funds to pay guaranteed benefits earned under pension plan, which ends as of Feb. 18, 2011. Retirees and beneficiaries will continue to receive their monthly benefit checks without interruption, and other workers will receive their pensions when they are eligible to retire. Until the PBGC becomes trustee of the plan, it will remain ongoing under company sponsorship. The agency will send notification letters to all plan participants when it becomes trustee.
Under federal pension law, the maximum guaranteed pension at age 65 for participants in plans that terminate in 2011 is $54,000 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.
Workers and retirees with questions 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.
Retirees of The Relizon Co. who draw a benefit from the PBGC may be eligible for the federal Health Coverage Tax Credit. Further information may be found on the PBGC Web site at http://www.pbgc.gov/wr/benefits/hctc/hctc-faqs.html.
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PBGC No. 11-23