I’m guessing (without knowing all the specifics of the pension plan) that this was strictly through the company and not subject to any sort of insurance over the accounts?
In any case, I can definitely sympathize with those affected by this ruling. Had this happened to my grandparents (who were VERY well taken care of by Caterpillar after my G-pa’s 40+ years with them), I don’t know how they would’ve survived really...
We got notice a few months back that the company my husband’s pension from his first job was through went bankrupt. Fortunately, the pension plan was insured by the government (kind of like FDIC from what I understand) - the only thing is that since my husband is only 39, and we don’t really trust the gov’t to be solvent in 25 or so years we will be electing to receive a lump sum payment - after taxes and penalties it will come to be something like 5K... That’s it, but I suppose it’s much better than nothing at all!
We lost a little “safety net” for our retirement (not like we were depending on that alone mind you), but seeing the way things are going currently with our economy it seems a safer bet to pay the penalties and control where our money goes today (i.e. using it for a downpayment on a home or some such thing) than wait and MAYBE see it when we’re 65+.
It’s a shame there wasn’t some provision in these people’s retirement/pension plans for this situation. One cannot expect an employer to exist forever - especially in this economy. However, there should be some way to compensate these former employees and not just hang them out to dry as seems to be happening... At least MORALLY these employers have a duty to these people even if legally they don’t.
I should’ve added that you, your family, as well as your former co-workers will be in my prayers. I can only imagine the anger and frustration you must be feeling right now...
There was. Many people sent paperwork to the Judge that had the words “for life” in our benefit descriptions. For some reason, it’s only ‘binding’ if it’s a union agreement apparently.
It will be tough. Sure we have savings, but we figure it will cost us at least $600 for health and dental insurance. Throw an amount like that into an already tight budget.
Right. Their moral obligation should have been to set up an outside fund. Although, the one silver lining is that more and more young people see through this and either are independent contractors with their own funds or don’t work for companies that make unfunded promises.