Pension plans are usually related to employment — the employer promises an employee a certain amount for retirement associated with that employee’s work.
It’s kind of like a retirement plan, but with a slight difference. Many retirement plans available through employers (such as a 401(k)) make it the individual employee’s responsibility to contribute to the plan and choose their retirement investments.
Pension plans, however, guarantee a certain amount of monthly income in retirement, with the investment risk placed on the employer instead of the employee.
Disputes over pension plans generally arise over payments made to retired persons through the pension funds. This usually involves a conflict between the retiree and their former employer, although it can also involve other parties as well.
Most commonly, pension plan disputes involve certain disagreements:
- Disputes over the timing or amount of the payments from the pension plan;
- Disputes over taxes, insurance, or other related matters; and
- Conflicts involving the denial of pension benefits.
Of course, other sources of conflict can arise, as well. Some pension benefits can be shared with other persons, such as a spouse or significant other. When other people are involved, pension plan disputes can arise in connection with other legal proceedings, such as a divorce or the distribution of property according to a will after a person’s death.
There are specific statutes that govern pension plans. These include the Pension Protection Act of 2006 (which requires that employers take certain precautions to make sure pension plans are properly funded), and the Employee Retirement Income Security Act (also called ERISA).
ERISA requires that employees are provided accurate information about their pensions and retirement plans, including information about plan features, funding, vesting, and the claims and appeals process for participants. It also sets minimum standards for pension plans, guaranteeing that pensions cannot be unfairly denied or taken away.
Together, these laws lay out specific guidelines that must be followed with it comes to pension benefits, and there are some protections for workers if certain types of pension plans cannot pay all the benefits that the workers are entitled to. If these legally required guidelines are not followed, you may need to file a retirement plan lawsuit in order to recover lost benefits.
While pension plans may vary, there are common underlying structures. Under ERISA, all pension plans must have an established claim procedure. When your claim is filed, you must receive a written decision on the claim within a “reasonable time.”
If your benefits have been denied, the claim must give specific reasons as to why those benefits were denied, and explain the basis for determining the basis of any benefits that are granted.
After you receive a written decision on your pension claim, you have 60 days to file a written appeal of the decision. The rules on where and how to file your appeal must be explained in the plan summary.
If your claim is still denied on appeal, you have a right to pursue your claim in either state or federal court. If it gets to this point, you may want to consider talking to an attorney who can help you put together the best possible representation for your case.
If you are having a dispute regarding pension benefits, you may want to ask around — if other employees are having similar disputes, or have been denied their benefits, you may consider filing a class action lawsuit. An experienced attorney can give you more information regarding this possibility, and advise you on what needs to happen in order to move forward if this option is available to you.
Legal remedies in cases of pension disputes may involve recovery of lost benefits; if you have been denied them, your attorney can fight to have your benefits reinstated. Remedies may also include the court compelling the employer to adjust their pension policies. Cases that involve misrepresentation or fraud may also result in criminal consequences.
Other possible pension disputes include instances of terminated plans. Some employers may to terminate pension plans, even if they are financially sound. Many companies may do this in the name of cutting back on corporate costs.
If your employer does in fact decide to terminate your pension plan, your plan administrator is required to notify you of the termination in writing, at least 60 days before the plan ends. The administrator is also required to tell you how the plan’s money will be paid out and what options you may have during the payout period.
If you have concerns about your pension plan, it is in your best interests to talk to a professional before you take action. Disputes over pension plans can get complicated very quickly, and often involve nuanced legal issues. Talk to an experienced employment lawyer for help with your pension plan concerns.
The right lawyer can review your case with you and advise you about what options are available to you, as well as the best way to proceed. If you need to appear in court, your lawyer can represent you during the process, guiding you through the legal system as you work together to get the best possible outcome for your case.