Pension > SPD > Normal Forms of Benefit

NORMAL FORMS OF BENEFIT

What Is the Normal Form of Benefit Under the Plan?

The normal form of benefit for married participants is a qualified joint and survivor annuity. The normal form of benefit for participants who are not married is a single life annuity. Alternatively, optional forms of benefit may be elected, subject to spousal consent and other applicable Plan procedures. (See the discussion "When Are You Considered Married?" on page 20.)

Note, however, that if the value of your benefit is $5,000 or less, your benefit will be paid to you in one lump sum.*

What Is the Qualified Joint and Survivor Annuity?

Under the qualified joint and survivor annuity, a life time benefit is provided for you when your benefits commence and a survivor annuity is provided to your spouse after your death. The amount of the monthly benefit payable to you is reduced during your lifetime from what it would be if the pension were taken in the single life form. Upon your death, if you were not in bargaining unit employment on or after December 1, 1999, 50% of the benefit amount you were receiving will be paid to your surviving spouse for his or her remaining life. For these purposes, your surviving spouse is the eligible spouse to whom you were married when your benefit payments began. (See the discussion "When Are You Considered Married?" on the following page.)

If, however, you are a married participant in bargaining unit employment on or after December 1, 1999, the survivor annuity under the qualified joint and survivor annuity has been enhanced to equal 75% of the amount payable during your lifetime.

The amount of the reduction in your benefit depends on your age and your spouse's age. Since the reduction will vary from one case to another, you should ask the Fund Office for the actual amount you could expect to receive.

Here is an example of how this pension works:

You are about to retire at age 65 on a $1,000.00 per month normal retirement payment. Your spouse is 62 years old. With the qualified joint and survivor annuity, you will receive a lifetime benefit equal to $871.00 a month (a reduction of 12.9% due to the difference in age between you and your spouse) for your lifetime. When you die, assuming you retired from bargaining unit employment after December 1, 1999, your spouse will continue to collect 75% of your reduced retirement payment for life, or $653.25 a month. If you had retired from bargaining unit employment prior to December 1, 1999, your lifetime benefit would still be $871.00 per month, but your spouse's survivor benefit would be 50% of your benefit, or $435.50 per month.

*If your benefit is paid in lump sum, you may elect to have your benefit directly rolled over to an IRA or other eligible retirement plan that will accept payment, rather than distributed directly to you.

Please note, if you are married, the qualified joint and survivor annuity will be paid automatically unless you and your spouse give the plan trustees written notice to reject the qualified joint and survivor annuity before the date your benefit payments begin. Your spouse must agree to reject the automatic qualified joint and survivor annuity in accordance with Plan procedures. If, however, the value of your benefit is $5,000 or less, your benefit will be paid in one lump sum.

When you apply for retirement payment, you will be given the full facts and an opportunity to choose among the qualified joint and survivor annuity and other options.

Unless the value of your benefit is $5,000 or less, the only way you can receive another form of payment is if you and your spouse reject your right to the qualified joint and survivor annuity and have your spouse's signature witnessed by a notary public.

What Happens if Your Spouse Dies?

If you are receiving a qualified joint and survivor annuity on or after January 1, 1999, and your spouse dies while you are still alive, your monthly benefit will be adjusted to the payment you would have received under a single life annuity. This is called the "Pop-Up Benefit." The Pop-Up Benefit commences on the first day of the first month after your spouse dies, provided you have given a certified copy of the death certificate to the Fund Office. If you provide the Fund Office with the death certificate after such date, the Pop-Up Benefit will start in the next month and up to six months of retroactive Pop-Up Benefit payments will be made.

When Are You Considered Married?

For purpose of determining your automatic forms of Retirement Payments, you are considered married (and thus the qualified joint and survivor annuity is your normal form of benefit) if you were legally married to a spouse for the one year period preceding your annuity starting date (or date of death, if earlier). If you were married for less than one year at your annuity starting date, you will be considered unmarried (and thus entitled to a single life annuity as your normal form of benefit) until you have been legally married for one year. At that point, you will be treated as married, and the qualified joint and survivor annuity will become your automatic form of payment. If you die prior to your annuity starting date, and you were married for less than one year at your date of death, you will be considered unmarried for purposes of determining rights to retirement benefits under the Plan. (Please note that these rules are different for the Supplementary Portion of the Plan, described on page 25.)

What Happens if You Are Divorced?

The qualified joint and survivor annuity is usually cancelled if you are divorced before your retirement payment begins; the benefit will then be paid to you in a single life annuity or another optional form of benefit selected by you.

However, once payment in the qualified joint and survivor annuity form begins, the amount is not changed because of divorce.

The Plan may be required by law to recognize obligations you incur as a result of court-ordered child support or alimony. The Plan must honor a "qualified domestic relations order," which is defined as a decree or order issued by a court that obligates you to pay child support or alimony, or otherwise allocates a portion of your benefits under the Plan to your spouse, former spouse, child or other dependent. If such an order is received by the Plan Administrator, all or a portion of your pension benefits may be used to satisfy the obligation.

The Plan Administrator will determine the validity of any domestic relations order received.

In some cases, the qualified domestic relations order may give your ex-spouse or an alternate payee (your child or other dependent) a right to part or all of your retirement benefit, payable at any time after you reach early retirement age, whether or not you are retired at the time. The order must clearly identify the alternate payee and the part of your benefit to which he or she has a claim. Earlier spouses' claims, under such domestic relations orders, take precedence over other parties' claims, including yours and those of any of your subsequent spouses.

You may request a copy of the Plan's QDRO procedures from the Plan Administrator without charge.

If you are receiving the qualified joint and survivor annuity and are later divorced, your ex-spouse will be entitled to a benefit unless otherwise specified in a divorced or other qualified domestic relations order.

What Is a Single Life Annuity?

A single life annuity is an annuity paid over the life of a participant. Upon your death, no additional benefits are payable.