Thursday, February 23, 2006

It's clear that LANS has done what it had to and no more

Submitted by Sheila Malony:

Friday is the deadline for comments NNSA on the benefits package. I've
submitted the following two; if anyone else is interested, you may want
to add your comments also.

Under UC, vested employees can leave UC and go inactive, taking
retirement at a later date, often years later than they separate from
UC. During this inactive time, the COLA is applied each year to the
benefits to be taken later. I have seen nothing in the LANS benefit
package that addresses whether those employees vested in LANS TCP 1 can
go inactive when they leave LANS. This is an important consideration.
If I go with LANS TCP 1 but decide to leave in 2-5 years (I'm barely
50), I would like the option of taking my pension benefits then or
waiting until I am 60 or so, letting the benefits rise with an annual
COLA. This would maintain "substantial equivalence" to UC. If I knew I
HAD to take the pension when I left, this will factor into my decision
about whether to stay here, transfer across to TCP1, or go inactive
with UC and go into TCP2.

I know that LANS purports that its TCP1 is "substantially equivalent"
in the aggregate to UC's benefits and pension. However, we lose the
CAP, the 401(a), and the 457 plans. LANS' reasoning is that it is not
allowed under rules/laws for private companies. However, I think they
CAN make up this loss in other ways. They could change the pension plan
formula slightly to grant future retirees greater pensions to make up
for this loss. It could be done by adding time to a person's age, or
adding time to a person's service credit at retirement, or adjusting
the formula in some other way. These numbers could be figured out by
the actuaries. Call it a "service credit enhancement" or "age
enhancement" added to those who cross over to TCP1 to maintain
equivalence with UC's plan.

It's clear that LANS has done what it had to and no more. Where there
are losses, there has been no attempt to make up those losses--just the
excuse that "it's not allowed." Enhancements ARE allowable to make up
for the other losses, to make the plans "substantially equivalent"!

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