Annuity Distribution Issue

[eberry16]

What is the name of your state (only U.S. law)? Indiana

My husband was an Iron Worker for 15 years. He left the Union and began working for a non union company. He is vested and has tried to get his annuity distribution but has been told that the Board of Trustees must approve the distribution because he went to work for a non union company. Why would this have anything to do with him receiving the money he earned while he was a union iron worker?

 

[Zigner]

What is the name of your state (only U.S. law)? Indiana

My husband was an Iron Worker for 15 years. He left the Union and began working for a non union company. He is vested and has tried to get his annuity distribution but has been told that the Board of Trustees must approve the distribution because he went to work for a non union company. Why would this have anything to do with him receiving the money he earned while he was a union iron worker?

Perhaps your husband needs to ask for clarification.

 

[davew128]

What does the plan document say?

 

[QBU]

Long time "lurker" with 23 years experience in qualified retirement plan administration and compliance here. You said your husband was previously a union worker so that tells me that his retirement plan was probably a multiemployer plan. A multiemployer plan (an agreement between certain employers and unions) requires "portability". Basically, that means that to be considered terminated (or separated from service) for purposes of obtaining a distribution, the employee must NOT be working for any other entity covered by the plan.

It very well might be that they simply need to verify your husband's current employment to make sure he's not covered by the multiemployer plan. Failure to do so could cause them very big problems.

A Summary Plan Description (a layman's version of the plan document provisions) should probably confirm very quickly if this is the case.