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Benefit guarantee

  • Opinion Letter 76-85

    PBGC is precluded from guaranteeing expanded benefits to which participants would become entitled to (become nonforfeitable) upon the plan’s termination.

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  • Opinion Letter 78-18

    PBGC guaranteed benefits are not impacted by funding difficulties, and an employer is liable to PBGFC to the extent guaranteed benefits exceed plan assets

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  • Opinion Letter 86-28

    PBGC deducts an annuity purchase when calculating a participant’s maximum guaranteed benefit.

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  • Opinion Letter 76-112

    A participant who has completed the requisite number of years of service and has attained retirement age has a nonforfeitable vested benefit in the plan, even if he has not ended his employment as the time of plan termination.

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  • Opinion Letter 76-72

    Provides that because guaranteed benefits are determined at time of plan termination, a clause in a plan that provides for the cessation of benefits in pay status of participants who violate prohibitions against certain competitive employment will be determined at such time that the clause becomes applicable to a participant.

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  • Opinion Letter 90-04

    Addresses whether interest rate changes subsequent to the mass withdrawal valuation date may be considered in determining the reallocation liability upon a mass withdrawal. It also addresses the burden of proof a multiemployer plan must satisfy to show an amendment increasing benefits was adopted earlier than the formal date of adoption which would make payment of the benefit increase covered by the PBGC guarantee.

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  • Opinion Letter 81-07

    Following a restructuring of three pension plans maintained by one company, each restructured plan remains a Title IV covered plan, each plan qualifies as a successor plan, and the plan sponsor would be liable to PBGC for any funding deficiency at termination.

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  • Opinion Letter 85-26

    Pension Benefit Guaranty Corporation 85-26 November 22, 1985 RE FERENCE: [*1] 4022 Benefits Guaranteed OP INION: You have indicated that the business of your cli ent, the * * * Company will be purch ased in a leveraged buy-out bya few o f the current employees through a newly organized corporation. It is expected that most of the employees willcontinue to work for the new corporation wit h a signif icant reduction in benefits and possibly a reduction in salary. Inconnec tion with the sa le, your client plans to terminate its three pension plans. Yo u have indicated that the assets of allthree plans are insu fficient to pay benefits guaranteed under Title IV o f ERISA, so that following the plan terminations,PBGC will becom e responsible for unfunded guaranteed benefits. You have asked whether those employees eligiblefor unre duced retirement (30 years of ser vice) who continue to work in similar jobs for the new company can be treatedas retired from the * * * Company. We assum e that the question is one o f first impression that is not addressed in the plan documents, since * * * is t heplan sp onsor and plan administrator. Tho se employee s who continue to work for the new company should not be treated, under the terms of the * * * plans, as eligi ble for retirement. As one [*2] court has observed, "[i]nitially, it would appear most unlikely that anyemployee would reasonably believe that early retirement benefits could commence while he or she was still working atthe same j ob even though a different employer has taken over salary obligations." Esler v. Northrop Cor p., Case No. 205 37-B (W.D. Mo. Aug. 4, 1981) Slip Op. p. 5. Further, we note that, under certain circumstances involving continued employment with a buyer or other successor, the PBG C does not guarantee earl y retirement benefits regardless of the terms of a pension plan. Title IV was intended,first and f oremost, to guarantee retirement benefits, and was

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