Law Governing Pre-ERISA Pension Plans

[Guest micriv]

Overview:

Company A sponsored and maintained a DB pension plan (originally effective 1953). Company A was acquired by Company B (after 1970). After the acquisition, Company B assumed the liabilities of Company A and began to maintain the beforementioned pension plan.

At that time, there was a federal statute, the Welfare and Pension Plans Disclosure Act, 29 USC 301 et seq ("WPPDA") which imposed disclosure obligations on employers, but did not provide federal jurisdicition for benefit claims. WPPDA was repealed upon the enactment of ERISA, but continued to apply to any conduct and events which occurred before January 1, 1975.

Questions:

1. What other pertinent law would govern a pre-ERISA pension plan? State common law of Trusts?

2. I do not have a copy of the original plan document (effective 1953). The plan has been amended twice ('59 restatement, '66 amendment). I have copies of the amendments (which were received from Company b), but they are unexecuted -- If a employee participated in the pension plan since its original effective date, is that pre-ERISA plan required to preserve benefits, rights, and features in subsequent restatements prior to 1974?

[Guest RARogers]

Most of the participant protections were contained in the IRC in effect then. Primarily discrimination rules - for example, you didn't have the ERISA coverage rules, but you had discrimination rules that could disqualify your plan if your coverage rules resulted in gross discrimination.

Also, the definitions of "plan" and "pension plan," etc. resulted in a farily extensive set of specialized rules. See the old regulations under ss 401. There were a number of Revenue Rulings and regulations that applied and were the basis for what could be done - for example, there was a Revenue Ruling 71-246 (??) - something like that - that governed integration.

There were no funding rules.

So far as fiduciary issues - I guess you (participant) had trust rules and contracts (your employment contract), and federal labor rules.

[Guest RARogers]

Most of the participant protections were contained in the IRC in effect then. Primarily discrimination rules - for example, you didn't have the ERISA coverage rules, but you had discrimination rules that could disqualify your plan if your coverage rules resulted in gross discrimination.

Also, the definitions of "plan" and "pension plan," etc. resulted in a fairly extensive set of specialized rules. See the old regulations under ss 401. There were a number of Revenue Rulings and regulations that applied and were the basis for what could be done - for example, there was a Revenue Ruling 71-246 (??) - something like that - that governed integration.

There were no funding rules.

So far as fiduciary issues - I guess you (participant) had trust rules and contracts (your employment contract), and federal labor rules. There was a federal law that required some sort of bonding - probably the same law you refer to in your message.

Also if the plan has been in effect after ERISA, their are undoubtedly things that should have been done since then - although I supsect that there are losts of transitional rules under ERISA that would apply.

[Guest Harry O]

What is your issue?

Obviously, just because a plan's effective date preceded ERISA doesn't give it a pass from all the qualification requirements.

There are some special exemptions from sections 410, 411, etc, for pre-ERISA plans with no post-ERISA employer contributions.

[Guest micriv]

More Info:

Employee of Company A was age 54 (almost 55) and had 26 years of service with Company A when he terminated his employment in 1969.

At the time of his termination, employee knew about the pension plan through word of mouth only (appears that no written information was provided by Company A to any plan participant). The employee thought he was fully vested in his pension benefit based on his years of service.

He did not inquire about his pension benefit until 1993. Upon receipt of his inquiry, Company B provided him a copy of the plan (as restated in 1959 and amended again in 1966) and told him that he had failed to meet the plan's requirements to receive a benefit, maintaining the requirement to receive a benefit was age 55 and 20 Y/S.

Employee claims that had he known about the age requirement, he would have worked the remaining months until his 55th birthday.

Issues:

What law controls this situation? Is WPPDA correct?

What duty did the plan have in regards to disclosure and providing an SPD and/or copy of the plan document to plan participants from 1953 - 1969?

What is the Statute of Limitations?

[Guest jwooten]

About all the WPPDA would have done for this participant would be to allow him to request documents from the plan. WPPDA only required documents to be provided on request. There was no SPD requirement until ERISA.

This means the employee's remedy was a state law contract claim. Presumably the statute of limitations ran decades ago.

[This message has been edited by jwooten (edited 03-03-99).]