Missing Employee Data

[Randy Watson]

Plan has been in existence for years. We are missing some very old, but very important employee data (date of hire, compensation, etc....) for a handful of employees. Any suggestions on how to deal with this? Employer clearly misplaced the information, but should we request that the employees somehow prove they were employed and what compensation they earned during those years before we give them credit under the Plan?

[quinnfield]

just a suggestion--but you could ask them to provide their Social Security Benefit Statements. These include the full earnings history. Maybe you could impute hours worked from the annual earnings.

[JanetM]

Regular SS statements won't work as they don't list employer just annual amounts. You can have them go to SSA and get earnings detail - will show employer, dates and amounts for each year. If these are all DVT folks weren't their benefits calculated at the time of termination? How have they set value of liability if you didn't calc a benefit?

[Andy the Actuary]

Plan has been in existence for years. We are missing some very old, but very important employee data (date of hire, compensation, etc....) for a handful of employees. Any suggestions on how to deal with this? Employer clearly misplaced the information, but should we request that the employees somehow prove they were employed and what compensation they earned during those years before we give them credit under the Plan?

It is assumed you are the takeover guy or you would have this information. Therefore, the prior actuary should have at least the demographic information and some amounts that either are or resemble the appropriate compensation information. Once you have assembled a database, you can finesse this by providing all employees [not just the handful] with a statement of accrued (and possibly projected) benefit and list the data. The statement would then indicate that "the statement was prepared using the following data and you should advise blah blah if your records of compensation differ from those reported." This would also satisfy the new benefit statement requirement provided we eventually know exactly what that is. In short, no one will never have to know that walls bump into your client.

[Guest Kabert]

The employer has an ERISA obligation to keep all records needed to calculate benefits, as I'm sure you know. But, because of this, I'd tread lightly, and decide unknowns in favor of the employee. Two approaches I've seen employers take -- one is to have employee (that is, employer to show employee how to) get data from SSA; the other is to take the oldest data available, and make generous assumptions further back about compensation. As for date of hire, SSA is probably your best bet. By the way, make sure you don't have health plan data/insurance company info that may have some helpful information.