Q: WHAT IS THE PAGE/COLLINS CLASS ACTION ABOUT?
The PBGC is a federal government agency that insures the pensions of workers,
retirees and their beneficiaries upon the termination of private pension plans.
In the class action lawsuit, four former participants in terminated pension
plans contended that the PBGC declined to guarantee the pension benefits
of participants who were vested under the rules of ERISA (the 1974 pension reform law).
ERISA required pensions to vest after 10 years of service with an employer.
Although the law was mandatory, the pension plans at issue had not changed their
vesting rules to comply with the law before the plans terminated.
The PBGC denied that it is liable to pay these participants, because their benefits were
not vested under the terms of their plan documents. However, the PBGC desires to resolve
the case and provide the members of the Class with relief that is more certain and prompt
than may be achieved through continued litigation.
Counsel for the class concluded that this settlement is in the best interest of the class
because it accounts for the risk that the class might not win the lawsuit and provided
benefits more quickly than further litigation.
Q: WHO IS INCLUDED IN THE CLASS ACTION?
A: The Court has certified that the class of persons affected by the lawsuit is
defined as all persons:
- Who were participants in pension plans covered by ERISA Title
IV that terminated between January 1, 1976 and December 31, 1981;
- Whose pension plans had not adopted vesting schedules for
retirement benefits, effective as of the plan's termination, that satisfied
the ERISA minimum vesting rules in 29 U.S.C. Section 1053;
- Whose years of service with the companies sponsoring such
terminated plans before the dates of termination satisfied one of the
ERISA minimum vesting rules in 29 U.S.C. Section 1053; and
- Whose pension benefits the PBGC did not guarantee.
Q:WHAT DOES THE SETTLEMENT OFFER?
- Class Members with 10 or more years of service:
For Class Members who had 10 or more years of service when their
plans terminated, PBGC will pay 80 percent of the difference between
the vested benefit, as calculated pursuant to the Settlement Agreement,
and any benefit previously distributed to the Class Member. Class Members
will receive interest on settlement benefits from the valuation date
to the date settlement benefits are paid. Although individual settlement
benefit amounts are not known, payments may be substantial for Class
Members who were entitled to significant pension benefits but did not
- Class Members with at least 5 but less than 10 years of service:
Class Members with at least 5 but less than 10 years of service will receive a
lump sum settlement benefit not to exceed $60 for each year of service. Participants
in plans that paid all benefits and had surplus assets are excluded.