Protection of AP's interest in Plan for 18 months

[Guest Chelsi]

Does anyone know if the Plan can limit the AP to less than 18 months for getting the DRO qualified before it distributes funds to the participant?

I am an AP. One plan told me they would give me only 1 month to get the DRO signed by a judge and then would not protect my interest in the Plan after that unless I kept renewing my request monthly for up to 3 months. I am concerned because the court process can take months especially in a contested situation.

I also asked them for their written QDRO rules and the contact person at the Plan wrote me a letter that listed their requirements for a QDRO. Is this sufficient? Aren't they required to have formal written QDRO procedures on file with the DOL?

Also, what does it mean that "any determination that an order is a QDRO that is made after the close of the 18-month period is to be applied prospectively only?"

When does the 18 month period start to run?

[QDROphile]

You may be dealing with a blockhead administrator, so the following bits of information may not be much practical use to you:

A plan is required to have written procedures for QDROs. There are no standards and the procedures are not required to be filed with any authority. The procedures must be provided on request.

A plan administrator is not required to protect a would-be alternate payee until receipt of a domestic relations order unless the applicable QDRO procedures are more agressive about protecting alternate payees. I believe that any domestic relations order will do. Even if the DRO is not qualified, the plan must allow a reasonable time to cure the qualification defects. I also believe that the court procedures and claendars need to be taken into account for determining a reasonable time.

The 18 months starts when the plan would make a distribution that would be affected by the domestic relations order, if qualified. I don't know the resolution of conflict between (i) the reasonable time for cure, and (ii) 18 months. If I were not a blockhead administrator, I would go with reasonable time for cure.

If the plan is a defined benefit plan, beware the annuity starting date and hope noboby dies before final resolution. Those events profoundly affect what can be done.

None of this information includes any suggestion about how best to go about any particular action to best protect your rights. The more the administrator is wrong and resisitant, the more you need competent legal counsel.

[david rigby]

... and you can read more about QDRO's here: http://www.dol.gov/ebsa/publications/qdros.html

[QDROphile]

The problem with that publication is that it contains a few legal errors. The Department of Labor has some erroneous understandings, including about protection of would-be alternate payees before a plan receives a domestic relations order.

[Guest Chelsi]

The problem with that publication is that it contains a few legal errors. The Department of Labor has some erroneous understandings, including about protection of would-be alternate payees before a plan receives a domestic relations order.

You mean before the plan receives the initial DRO? What should the AP be aware of?

Thanks for your comments. Dealing with those people at those plans can sure be frustrating. There is such a lack of consistency and the DOL didn't make the rules that clear.

[david rigby]

The problem with that publication is that it contains a few legal errors. The Department of Labor has some erroneous understandings, including about protection of would-be alternate payees before a plan receives a domestic relations order.

Are you willing to elaborate?

[GMK]

Chelsi,

Recommended reading:

See post #4 here:

http://benefitslink.com/boards/index.php?showtopic=45227

(which you may have already seen),

and here's some more:

http://benefitslink.com/boards/index.php?showtopic=44973

[QDROphile]

david:

The Department of Labor believes that a plan has the obligation to lock (very indefinite term that is not the DOL's term) a participant's benefit if the plan has any reason to believe that a domestic relations order will be submitted some day. That is contrary to the words of the statute and the only published federal court decision that I am aware of. A plan is required to act only after receipt of a domestic relations order.

There are other misconceptions that the DOL has about QDRO procedures. The DOL typically does not consider the isses for plan administrators (including ERISA duties) when it comes up with its informal positions. I can understand why, including that there are many wrong-headed adminstrators out there that cause unnecessary trouble.

While I am complaining about the DOL, its recent QDRO regulations are fluff. We did not learn anything we did not know before Congress acted to require the regulations. The DOL did not get into any of the difficult or interesting issues to guide us.

[mbozek]

Does anyone know if the Plan can limit the AP to less than 18 months for getting the DRO qualified before it distributes funds to the participant?

I am an AP. One plan told me they would give me only 1 month to get the DRO signed by a judge and then would not protect my interest in the Plan after that unless I kept renewing my request monthly for up to 3 months. I am concerned because the court process can take months especially in a contested situation.

I also asked them for their written QDRO rules and the contact person at the Plan wrote me a letter that listed their requirements for a QDRO. Is this sufficient? Aren't they required to have formal written QDRO procedures on file with the DOL?

Also, what does it mean that "any determination that an order is a QDRO that is made after the close of the 18-month period is to be applied prospectively only?"

When does the 18 month period start to run?

I notice that you have initiated several threads on this QDRO going back to last Aug. According to your prior posts your husband's benefits were from his service as a NYC police detective. Public employee pension plans are not required to comply with federal QDRO regulations under the jurisdiction of the Department of Labor so the rules may be different from the rules for private employers. Are the benefits you are seeking from your ex's service as a NYC detective?

[Guest Chelsi]

One plan is a deferred compensation plan and the other is a annuity plan that is paid into by NYC for each employee of the NYPD. They are defined contribution plans, not pension plans. I was married for about 14 1/2 years while contributions were being made to these plans.

The NYC plan said they place a hold on the account until the QDRO is implemented. The annuity plan said they'd place a hold on the account only for one month at a time for up to 3 months.

I have to re-submit QDRO's to the courts and the courts tend to delay things here for months. I just recently started dealing with the annuity fund and was wondering why they give so little time compared to the other plan and if the 18 month rule applied to them.

Also, my ex- spouse's retirement is pretty much imminent. I know I can get a restraining order, but it would be simpler if the fund would just cooperate.

Kind thanks to all for the help! Hopefully, I will finally resolve all this and get a good education in the process!

[mbozek]

One plan is a deferred compensation plan and the other is a annuity plan that is paid into by NYC for each employee of the NYPD. They are defined contribution plans, not pension plans. I was married for about 14 1/2 years while contributions were being made to these plans.

The NYC plan said they place a hold on the account until the QDRO is implemented. The annuity plan said they'd place a hold on the account only for one month at a time for up to 3 months.

I have to re-submit QDRO's to the courts and the courts tend to delay things here for months. I just recently started dealing with the annuity fund and was wondering why they give so little time compared to the other plan and if the 18 month rule applied to them.

Also, my ex- spouse's retirement is pretty much imminent. I know I can get a restraining order, but it would be simpler if the fund would just cooperate.

Kind thanks to all for the help! Hopefully, I will finally resolve all this and get a good education in the process!

It doesnt appear that either of these plans would be subject to the DOL rules for QDROsS discussed above because they are maintained by a government employer. You may have to follow the fund's rules for getteing court approval for the DRO unless the court order the plan to wait for the QDRO to be issued.

[Guest Chelsi]

Hi mbozek,

Thanks so much! The DOL confirmed this.