Supreme Court Decision re ERISA?

[CindyBlue]

Does anyone know how this might affect the defined benefits retirement for those working for church entities?
Supreme Court Backs Church Hospitals, Schools in Case on Pension Rules - The School Law Blog - Education Week

 

[donheff]

Sounds like it only matters if you work for a religious school or hospital and don't like how they have been managing their retirement plan. The decision simply says that the exemption from ERISA requirements that applies to religious organizations also applies to their affiliated schools, hospitals, etc.

 

[CindyBlue]

Sounds like it only matters if you work for a religious school or hospital and don't like how they have been managing their retirement plan. The decision simply says that the exemption from ERISA requirements that applies to religious organizations also applies to their affiliated schools, hospitals, etc.

Unfortunately, I do...I guess this means that I have to worry about my retirement (when I get there) every month for the rest of my life, since there is no oversight...sigh...

 

[Jerry1]

Unfortunately, I do...I guess this means that I have to worry about my retirement (when I get there) every month for the rest of my life, since there is no oversight...sigh...

Even with oversight, you'd be worrying about a defined benefit pension. It has surprised me over the years to read about how pensions go under and retirees get 50 cents on the dollar or less. Be thankful you don't work for a municipality. I think their pensions are a bomb waiting to explode.

 

[Jerry1]

Unfortunately, I do...I guess this means that I have to worry about my retirement (when I get there) every month for the rest of my life, since there is no oversight...sigh...

You'd probably have to worry anyway. I've been surprised to read how pensions go under and retirees get 50 cents on the dollar or less. Be glad you don't work for a municipality.

 

[CindyBlue]

You'd probably have to worry anyway. I've been surprised to read how pensions go under and retirees get 50 cents on the dollar or less. Be glad you don't work for a municipality.

Very good point.
I'm just going to have to stop worrying...I worry all the time (wry smile!) But there is nothing I can do about this. So I'll just have to work the two years I plan to work, and save all I can, and see what happens.

 

[Koolau]

Does anyone know how this might affect the defined benefits retirement for those working for church entities?
Supreme Court Backs Church Hospitals, Schools in Case on Pension Rules - The School Law Blog - Education Week

Do you have specific concerns indicating some problem with your particular plan? If so, I'd be talking to them about it now. Just because they have some exemptions doesn't mean they will necessarily do anything "wrong" or that you won't get your benefit when the time comes. If you "see something, say something" would be my suggestion. Of course, YMMV.

 

[kaudrey]

What this means is that if your DB plan is sponsored by a church-affiliated entity (such as a hospital, which are the entities mostly being sued right now, the plan is NOT covered by PBGC and not subject to ERISA's funding rules. So, you have two issues:


1) No insurance if the entity goes bankruptcy
2) The entity is no longer held to the funding requirements of ERISA, which means they don't have to put as much money into the plan, and therefore the plans are at higher risk of becoming severely underfunded over time (if they are not already), which could affect the ability for it to pay your benefits at their current expected level in the future.

 

[CindyBlue]

Do you have specific concerns indicating some problem with your particular plan? If so, I'd be talking to them about it now. Just because they have some exemptions doesn't mean they will necessarily do anything "wrong" or that you won't get your benefit when the time comes. If you "see something, say something" would be my suggestion. Of course, YMMV.

I didn't imagine that it would do any good to say something, but I did email the person who seems to be in charge of it. She says that that pension fund is still being contributed to (even though it is frozen, since a few years ago they froze it and switched everyone to a defined contributions plan) and will be until it is fully funded. But with no government oversight, there is no way to know if it will be, with her there or, when she retires or leave, with the next person there. And I have no way of knowing if what she says is true...

 

[CindyBlue]

What this means is that if your DB plan is sponsored by a church-affiliated entity (such as a hospital, which are the entities mostly being sued right now, the plan is NOT covered by PBGC and not subject to ERISA's funding rules. So, you have two issues:


1) No insurance if the entity goes bankruptcy
2) The entity is no longer held to the funding requirements of ERISA, which means they don't have to put as much money into the plan, and therefore the plans are at higher risk of becoming severely underfunded over time (if they are not already), which could affect the ability for it to pay your benefits at their current expected level in the future.

Yes, you have said it perfectly - those are exactly my concerns. I don't think it ever was under ERISA, since it is a church entity, but if the Supreme Court had made a different decision, maybe it would have been forced to be. So this means that I will worry for the rest of my life if that check is going to come. I have read about other retirement programs going bankrupt and people losing the funds they depend on...just somehow never thought that it might happen to me.
I guess I shouldn't worry about it, since there's nothing I can do about it...but I will...

 

[Chuckanut]

Along with this decision I read about a certain state that has balanced their budget of the last 5 years by under funding their pension plan. I am shocked! Shocked!! Gosh, what ever happened to those omnipotent public employee unions?

The more I read about this stuff the more I am convinced that retirement funds should be paid to employees every pay period, put into a tax advantage account that is 100% controlled by the employee. No company, advisor, manager, politician, etc. should be able to touch 1¢ of the money. Otherwise the pot is just to tempting a targe.

 

[kaudrey]

The more I read about this stuff the more I am convinced that retirement funds should be paid to employees every pay period, put into a tax advantage account that is 100% controlled by the employee. No company, advisor, manager, politician, etc. should be able to touch 1¢ of the money. Otherwise the pot is just to tempting a targe.

aka....a 401(k) with company match...

 

[slaternuthink]

Yea, this affects me too (so few of us?). I am disappointed and a little surprised at the unanimity of the decision. I guess this makes it truly supra political (satire).
Shortly after the announcement, my hospital sent out a couple of comforting e-mails. To paraphrase - we value our loyal employees etc…., don’t worry about your pension, it is fully funded for the next 10 years.
What to do? I will give more thought to the lump sum option, not particularly favorable in my plan. Of course this probably means the annuity funding assumptions are unrealistic. I have a few more years to decide. Ah well, in the meantime back to goat rodeo with Blind Faith, or B D’s “shine the light”. playing in the background. Sigh

 

[CindyBlue]

Yea, this affects me too (so few of us?). I am disappointed and a little surprised at the unanimity of the decision. I guess this makes it truly supra political (satire).
Shortly after the announcement, my hospital sent out a couple of comforting e-mails. To paraphrase - we value our loyal employees etc…., don’t worry about your pension, it is fully funded for the next 10 years.
What to do? I will give more thought to the lump sum option, not particularly favorable in my plan. Of course this probably means the annuity funding assumptions are unrealistic. I have a few more years to decide. Ah well, in the meantime back to goat rodeo with Blind Faith, or B D’s “shine the light”. playing in the background. Sigh

Ten years, huh? Make sure you don't live more than ten years, huh?
Me, too...
sigh...