Do I hear that changes are coming to the pension program this month? Specifically, that if you "leave" the company you will no longer have the option to pull your pension out as a lump sum (and control it yourself)? You will have to take the annuity payment at retirement no matter what?
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Pension plan was over 80% after CEO Jeff Jacobson put 630 Million dollars in it last year. All the people leaving that I know have pulled the money out. Take an average of 400K per person times the number of people who have left and it could be approaching less than 80%. So on average every 5 people who leave are withdrawing 2 million dollars. Xerox has to keep that level above 80% to comply with the PBGC. Do you believe Carl Icahn wants to contribute more money into a system that gives money to employees?
The PBGC will not let you withdraw money if it goes to them. The annual funding notice and info on the pension website explains the scenarios Xerox could use to not pay the pension. Plus interest rates are rising which lowers the value of the lump sum supposedly 10% value reduction for every 1% rise in interest rates.
Certain changes can be done at any time as long as the correct process and notification process is followed, though there are likely some protected classes. The 80% funding issues is a PBGC rule, not plan, that disallows a lump sum payment option should any plan fall below the 80% funding level.
The hub says they can't change unless funding level goes under 80%. It's currently at over 100% they claim.
Fake news, update published on the HUB this morning
I think that's what they want. High end long term sales reps are doing the math and are quitting/retiring in the middle of big deals on the table, so that they don't lose the ability to pull their pensions as a lump sum should they get laid off. And that's the problem. The layoffs are coming fast and furious. If you get laid off after the changes happen, you're stuck hoping that your pension is safe and well managed.
where did you hear that the pension plan is changing? i haven't heard that from any of my sources