Thursday, January 19, 2006

The Plan stays for all, or the Plan disappears for all

Regarding the move to strip LANL employees and retirees out of UCRP,
here is a query I wrote to the Regents on October 2, 2003 (over two
years ago). I never received a reply.

I repeated the basic question to our illustrious Director Nanos at an
ISR visit he made. He said he had no idea what the answer was.

Obviously the best hope for a legal strategy is to challenge the UCRS's
ability to jettison a special class of its vested members. The UCRP Plan
Description, which has served as *defacto* contract lo these many years,
states only that the Regents "reserve the right to terminate the Plan at
any time". As I read English, that means, either the Plan stays for all,
or the Plan disappears for all. However, there is no mention in that
Plan Description of any Regents' right to excise a subclass of the UCRP

For your reading enjoyment I include (attached) a copy (pdf) of the Plan
Description. You might want to link it. See in particular page 23 of the
pdf, "Plan Changes", under the heading "Additional Information". [This
version is for members without Social Security, but that makes no
difference. The same boilerplate "Plan Changes" is in both versions.]

A good law firm- if LANL retirees wanted to pony up to buy their
services -could skewer the UC on this one.

Best wishes,
Abe Jacobson , retiree
(not anonymous)

2 October 2003
I would like to ask the Regents to address a matter of increasing
concern to Laboratory UC retirees and to those who plan to retire in the
future. The matter is an obvious inconsistency between the structure and
definitions of our retirement system and the language of the UC contract
with the DOE for management of LANL.

A little clarity can dispell this problem. So far, good information is
lacking, and in lieu of good information, people will naturally tend to
suspect the worst.

In the Summary Plan Description of the University of California
Retirement Plan, “vesting” is defined as

"Vesting generally refers to a member’s nonforfeitable right to receive
UCRP retirement benefits upon leaving the University and reaching
retirement age."

Suppose the UC/DOE contract should end. Suppose an employee, vested and
eligible to retire from the UC, chooses to retire prior to the end of UC
management of Los Alamos. Then his or her vesting in UCRP appears from
the above definition to be “nonforfeitable” even if the Laboratory
subsequently is managed by another contractor. Thus, if he/she retires
before the contract change, then it appears that vesting prevents
him/her from being taken out of the UCRP.

On the other hand, the December 2000 contract language between the DOE
and the UC contradicts the UCRP Plan Description. The Contract envisions
the possible desirability of pulling existing retirees out of the UCRP.

The Prime Contract states, in section H.008, (f), (2), (ii):
"Notwithstanding the [other] provisions of paragraph (f), the parties
further agree to consider the desirability of covering [current]
pensioners, survivors [of those already retired], and terminated vested
and nonvested members under a successor plan."

This is disturbing, to say the least. Many employees at LANL have sought
clarification of this confusion, to no avail. We have spoken with the
Department of Labor, with officers of the Laboratory, with University of
California Benefits, and with the UC Office of the President. The
confusion is not limited to Laboratory employees and retirees. Senator
Bingaman is on record as being surprised by the lack of clarity in this

The employees and annuitants deserve accurate, timely, and legally
defensible information. So far, however, no spokesperson for the
University has done other than to duck the question.

I am requesting that the Regents have their legal staff prepare a white
paper resolving this matter, and that the paper be made available to
Laboratory UC employees and retirees so that they can know exactly what
“vesting” means as we approach a possible contract termination.

Abram R. ("Abe") Jacobson


Click on News Release. You will find a .doc file where Przybylek said, "Retirees will continue to receive their pensions from the University of California Retirement Plan (UCRP)."
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