4022.3—Guaranteed benefits.
Except as otherwise provided in this part, the PBGC will guarantee the amount, as of the termination date, of a benefit provided under a plan to the extent that the benefit does not exceed the limitations in ERISA and in subpart B, if—
(a)
The benefit is, on the termination date, a nonforfeitable benefit;
(b)
The benefit qualifies as a pension benefit as defined in § 4022.2; and
(c)
The participant is entitled to the benefit under § 4022.4.
Code of Federal Regulations
[61 FR 34028, July 1, 1996; 61 FR 67943, Dec. 26, 1996]
Code of Federal Regulations
§ 4022.3
Nt.
Code of Federal Regulations
Effective Date Note:
At 76 FR 34601, June 14, 2011, § 4022.3 was amended by designating the introductory text as paragraph (a) with the heading “General.”, redesignating paragraphs (a), (b), and (c) as paragraphs (1), (2), and (3), and adding a new paragraph (b), effective July 14, 2011. For the convenience of the user, the added text is set forth as follows:
§ 4022.3
Guaranteed benefits.
(b) PPA 2006 bankruptcy termination. (1) Substitution of bankruptcy filing date. In a PPA 2006 bankruptcy termination, “bankruptcy filing date” is substituted for “termination date” each place that “termination date” appears in paragraph (a) of this section.
(2) Condition for entitlement satisfied between bankruptcy filing date and termination date. If a participant becomes entitled to a subsidized early retirement or other benefit before the termination date (or on or before the termination date, in the case of a requirement that a participant attain a particular age, earn a particular amount of service, become disabled, or die) but on or after the bankruptcy filing date (or after the bankruptcy filing date, in the case of a requirement that a participant attain a particular age, earn a particular amount of service, become disabled, or die), the subsidy or other benefit is not guaranteed because the participant had not satisfied the conditions for entitlement by the bankruptcy filing date. In such a case, the participant may have been put into pay status with the subsidized early retirement or other benefit by the plan administrator, because the plan was ongoing at the time. Even though the subsidy or other benefit is not guaranteed, the participant may be entitled to another benefit from PBGC (at that time or in the future). If so, PBGC will continue paying the participant a benefit, but in an amount reduced to reflect that the subsidy or other benefit is not guaranteed. PBGC will also allow a similarly situated participant who had not started receiving a subsidized early retirement or other benefit before PBGC became trustee of the plan to begin receiving a benefit (if the participant would have been allowed under the plan to begin receiving benefits and has reached his Earliest PBGC Retirement Date, as defined in § 4022.10
), but in an amount that does not include the subsidy or other benefit.
(3) Examples. (i) Vesting. A plan provides for 5-year “cliff” vesting—i.e., benefits become 100% vested when the participant completes five years of service; before the five-year mark, benefits are 0% vested. The contributing sponsor of the plan files a bankruptcy petition on November 15, 2006. The plan terminates with a termination date of December 4, 2007, and PBGC becomes statutory trustee of the plan. A participant had four years and six months of service at the bankruptcy filing date and became vested in May 2007. None of the participant's benefit is guaranteed because none of the benefit was nonforfeitable as of the bankruptcy filing date.
(ii) Subsidized early retirement benefit. The facts regarding the plan are the same as in Example (i) (paragraph (b)(3)(i) of this section), but the plan also provides that a participant may retire from active employment at any age with a fully subsidized (i.e., not actuarially reduced) early retirement benefit if he has completed 30 years of service. The plan also provides that a participant who is age 60 and has completed 20 years of service may retire from active employment with an early retirement benefit, reduced by three percent for each year by which the participant's age at benefit commencement is less than 65. A participant was age 61 and had 29 years and 6 months of service at the bankruptcy filing date. The participant continued working for another six months, then retired as of June 1, 2007, and immediately began receiving from the plan the fully subsidized “30-and-out” early retirement benefit. PBGC will continue paying the participant a benefit, but PBGC's guarantee does not include the full subsidy for the “30-and-out” benefit, because the participant satisfied the conditions for that benefit after the bankruptcy filing date. The guarantee does include, however, the partial subsidy associated with the “60/20” early retirement benefit, because the participant satisfied the conditions for that benefit before the bankruptcy filing date.
(iii) Accruals after bankruptcy filing date. The facts regarding the plan are the same as in Example (i) (paragraph (b)(3)(i) of this section). A participant has a vested, accrued benefit of $500 per month as of the bankruptcy filing date. At the plan's termination date, the participant has a vested, accrued benefit of $512 per month. His guaranteed benefit is limited to $500 per month—the accrued, nonforfeitable benefit as of the bankruptcy filing date.
(a)
Every labor organization shall file with the Office of Labor-Management Standards the report and (subject to the provisions of paragraph (b) of this section, where applicable) a copy of its constitution and bylaws required by section 201(a) of the Act and § 402.2, together with one additional copy of each, within 90 days after the date on which it first becomes subject to the Act.
(b)
A labor organization subject to paragraph (a) of this section may adopt or may have adopted as its constitution and bylaws (whether by formal action or by virtue of affiliation with a parent organization) a constitution and bylaws of a national or international labor organization which the national or international organization is required to file under section 201(a) of the Act and this part. In such a case, a filing by the national or international labor organization of copies of such constitution and bylaws will be accepted as a filing of such documents by each such adopting labor organization within the meaning of section 201(a) of the Act and this part, if the following conditions are met:
(1)
The national or international labor organizations shows in its report filed under paragraph (a) of this section that copies of its constitution and bylaws are being filed on behalf of such adopting organizations as well as on its own behalf, and files such number of additional copies as the Office of Labor-Management Standards may request, and
(2)
The adopting labor organization shows in its report filed under paragraph (a) of this section that the national or international constitution and bylaws are also its constitution and bylaws and that copies are filed on its behalf by the national or international labor organization.
If the constitution and bylaws of the adopting labor organization include other documents, this shall be shown in such report and copies shall be filed as provided in paragraph (a) of this section.
Code of Federal Regulations
[28 FR 14381, Dec. 27, 1963, as amended at 35 FR 2990, Feb. 13, 1970; 40 FR 58856, Dec. 19, 1975; 50 FR 31309, Aug. 1, 1985]