Conference 7.286::digital

A fairly high level manager at my site commented that he expected another early
retirement incentive package similar to the last except that this one 
would be based on 7 and 7.  ie add 7 years to your age and 7 years to your
years of service.  

I guess that would entitle 48 year olds with 3 years of service to retire.

    Seagrams 7 and 7?
    
    Tom
    

    I'll drink to that!
    
    
    
    (sorry, I couldn't help myself)
    
    Marie
    

    	I doubt that the company could afford to provide an early
    retirement package that would be much of an incentive for people to
    leave...especially after the last fiasco. So I have a hard time
    believing that any such plan exists.

    I also have trouble believing that they could go 7-7, but it's kinda
    fun to think about the possibilities...  moving someplace where "sleet"
    and "freezing rain" is unknown...

	Going to 7-7 would probably not go over will with people who took the
	last SERP. If there is an other SERP it's likely that the offer will
	be the same or less then the last one.

	The last one had more people take it then they expected from what I've
	heard. I've also heard a couple of people who could have taken the last
	one express regrets that they didn't. With the passing of time and more
	people being able to take a 5-5 as well as others who wished they had
	taken the last one a 5-5 SERP might just work.

			Alfred

    
    Well, if a 7-7 is being considered, why not just make it a 10-5....that
    way *I* could take it too!  :^)
    
    Carole

    I keep hearing the same thing, "7 + 7". The original date was supposed
    to be early march. My distric manager was the last source I have heard.
    Heres hopeing!!!!!!
    
    Jim

   NO!  Not March.  It has to wait until July.  If I waits until July
   then I'm eligible.

    I've checked on this rumor and could find nothing.  Is this one just
    wishful thinking?  It's no trivial matter to accomplish this as filings
    are required with the federal government well in advance of the actual
    offer.  Retirement funds are apparently closely regulated.

    What do you need to qualify for early retirement if there is one?
    7-7 is a benefit of the package.  The last package, which was 5-5,
    meant that they would add 5 years to your age and 5 years to your
    length of service.  In no way did it mean that the five years would
    be added to your age to qualify for the package.  If you were 55, 
    and had 4 years with the company, you could not qualify for the
    package, because you only had 4 years.  If you had 5 years with the
    company, you would go out as though you were 60 with 10 years with 
    the company.  That is the 5-5.  7-7 does not tell us what the youngest
    requirement age or the least time with the company.  If it is like the
    last one, 7 years will be added to your age and 7 years will be added
    to your length of service, after you qualify.  The question is how
    old do you have to be and how long with the  
     company
    before you can qualify for the 7-7?
    
    
    
    
    
    

                    <<< Note 2427.11 by GRANPA::MLOUGHERY >>>
                             -< Clarification.... >-

>    What do you need to qualify for early retirement if there is one?
>    7-7 is a benefit of the package.  The last package, which was 5-5,
>    meant that they would add 5 years to your age and 5 years to your
>    length of service.  In no way did it mean that the five years would
>    be added to your age to qualify for the package.  If you were 55, 

Thats not my understanding, the 5 & 5 meant that if I was 50 with 5 years
service then I could retire with the benefits of someone 55 years old with
10 years of service (the bare minimum). 
So, 7 & 7 would mean that you need to be at least 53 years of age with 3 years
of service.

- George

    
    	re -1
    
    	I'm a bit confused...is the minimum age for retirement 55 or 60?
    	If 55, then minimum age for a 7&7 package would be 48, correct?
    
    	John

    Correct - the minimum age to retire from DEC is 55.  The years they
    give with the package, when added to your real age, has to come to 55
    or more for you to be eligible to retire.  For 7-7, 48 years old would 
    be the youngest eligible.

    Vested Benefits - this is the legal term the companies are using
                      which supports the minimum length of service in
                      a company to have the right to collect retirement
                      funds.   This has been re-defined by law in 1986/87
                      to be five (5) years of service.  
    
    	However, vested benefits, assumes that you are 62 years that is the
    legal retirement age.  If the company (in this case DEC) wants to
    improve on this with any SERP package, my guess is that at minimum, the
    employees will have to be 'vested' or have five years of service.

    Re .15 
    	I believe that this is correct and was the criteria used for the 
    	SERP. The author of .11 has confused the issue of being vested with
    	the criteria for retirement of those that are vested.
    
    	It is true that if a person only has 4 years with the company that
    	SERP did not apply, but if a person was vested, the last package
    	added 5 years to ones age for the purpose of eligibility.

    
    Personally, I don't care what happens as long as there is something
    left in the fund for the Gen-X folks when our time comes.  
    
    What I fear is that the young (who are being laid off in inordinate 
    numbers BTW!) will be left holding the bag again.  
    
    To some, I may sound like a crybaby, but between Prop 13 in
    California, a screwed up Social Security System and *HUGE* severence
    plans paid out to folks who were fortunate enough to be born in the
    boom, things are pretty lousy for me and my littermates.
    
    -Ed_born_in_the_1960's_and_was_too_young_for_Woodstock
     

    At 55(actual or 'contrived by equation') you are eligible to 50% of
    your normal retirement, at 60... 67%, and at 65... 100%.
    
    In addition you must have at least ten years(actual or 'contrived by
    equation') to be eligible for ANY retirement benefits.
    
    Notice the % amounts don't accumulate linearly between ages 55 and 65.
    
    Bob[SERPer, who wouldn't be disgruntled with whatever a new SERP
    package would involve]

		... is a LONG-TERM liability to DEC, TFSO, isn't.

    
    	re -1
    
    	Regardless. We are still entitled to retirement benefits that we
    	have accrued whether our departure is voluntary or not.
    
    	John

    What does "7-7" refer to? Years to add to (what?) to arrive at (what?)
    Minimum age to retire early?

    Re .19 
    	Retirement is a long term liability, but there is a liability there
    	even if the employee is TFSO'd. The costs that are incurred are 
    	only the sweetner(if any) and the increased payments caused by the
    	added years of eligibility. I'm sure that the financials are
    	closely examined before early retirement is offered.
    
    Re .21
    	 7-7, seven years added to one's age for the purpose of
    	eligibility - seven years added to one's seniority for the purposes of
    	computing the pension benefits.

    	I wish the base noter had attached a copy of the March 16 article
    in VOGON news that mentioned another SERP. Does anybody have a copy ?
    
    	I for one would take it this time if offered.  I am sure I'm not
    alone !
    
    	   Bucky
      	 

I don't know if this is true.  However, I understand that SERPs can not be offered at the 
same time as layoffs.  I'm not sure if it is true or why, but some food for thought...

Jack B.

The reason you haven't seen the article from VNS that mentioned another SERP is
that the article *did not* say there was such a beast. It said,
(paraphrasing because I no longer have that day's input hanging around):
Employment will drop through a combination of layoffs, attrition and early
retirement.

No program announcement there, no 7-7, no anything else.

						Trace

    re: .18 - What then does being vested at 5 years mean if it requires 10
    years service to get any retirement benefits? Thanks.

    You are vested at 5 years and can draw a retirement benefit at age 65.
    
    To draw an early retirement you must be an ACTIVE employee 55 years old
    or older with 10 years of service.
    

    As I understand it if you are not vested you will receive your
    contribution in cash upon leaving. If you are invested your
    contribution and Digital's is kept in a fund until you reach
    retirement.
    
    If you choose to retire(either early, normal, working for DEC or not)
    you are eligible for your retirement based on your age(50% at 55, 67%
    at 60, 100% at 65). This can either be in lump sum payout, IRA
    rollover, or a company pension of which the payment is based on
    spouse survivor benefits.
    
    When you leave the company and you are vested you must "let it ride"
    until you retire. If you retire you may do the same or take some form
    of payout. Wherever you work after DEC and there is a pension plan you
    will get the sum of all pension plans when you retire.
    
    Thats the way I understand it,
    
    Bob[retired.....well sorta]

    
    Re: .30
    
    >As I understand it if you are not vested you will receive your
    >contribution in cash upon leaving. 
    
    Whether or not you receive it in cash depends upon the cash value
    of it at that time not upon whether you are vested or not.  The cutoff
    was $3500 a few years ago.  You received it in cash if it was less
    than that and if more then it stayed with the plan until you retired.
    
    >contribution and Digital's is kept in a fund until you reach
    >retirement.
    
    We make no contribution's to the retirement plan.  All contributions
    are made by the company.
    
    >If you choose to retire(either early, normal, working for DEC or not)
    >you are eligible for your retirement based on your age(50% at 55, 67%
    >at 60, 100% at 65). This can either be in lump sum payout, IRA
    >rollover, or a company pension of which the payment is based on
    >spouse survivor benefits.
    
    You can only get the lump sum payment if you are a Digital employee
    when you retire.  If you leave DEC before retirement that option
    will not be available to you when you do retire.
    
    Steve
    
    
    

           Digital U.S. Employee Benefits Book-1992 Edition


          8.5  Basics: How the Pension Plan from Digital works . . .

          8.5.1  When you have a right to your pension benefit even if you
                 leave Digital before retiring

          If you leave Digital before working for five years, you will not
          receive a pension benefit from the company unless you are age 65
          or older when you leave. That is because you are not "vested" in
          the plan. Vesting means that you have a nonforfeitable right to
          receive a pension benefit when you reach retirement age, even if
          you leave Digital before then.

          When you have worked at Digital for five years, you are 100%
          vested. This means that you have a right to receive 100% of your
          accrued pension benefit at retirement, as the accompanying chart
          shows. One exception: If you are age 65 or older with at least
          one full year of vesting service, you are automatically 100%
          vested.

          Years of vesting        Nonforfeitable portion of your pension
          service                 benefit

          1 year                  0%

          2 years                 0%

          3 years                 0%

          4 years                 0%

          5 years                 100%*

          *At age 65 with one year of vesting service, you automatically
          are 100% vested.

          8.5.2  How your years of vesting service are counted

          Your time for vesting purposes starts on your hire date. The way
          vesting service is counted depends on when you started working
          for Digital. More specifically:

          o  If you were hired on or before June 30, 1979, you have one
             year of vesting service as of July 1 following your date of
             hire. You earn one year of vesting service every July 1 after
             that. For example, if you were hired on October 1, 1969,
             your first year of vesting service was credited as of July 1,
             1970, your second year as of July 1, 1971, and so on.

          o  If you were hired after June 30, 1979, you earn one year of
             vesting service on each anniversary of your hire date. For
             example, if you were hired on October 1, 1984, you earned
             one year of vesting service on October 1, 1985, two years on
             October 1, 1986, and so on.

          8.5.3  When you can begin receiving your pension benefit

          You can actually receive pension benefits when you leave Digital
          if you are:

          o  Vested and your vested pension benefit has a present value
             of $3,500 or less. (If the present value of your pension is
             more than $3,500 when you leave, you must wait until you are
             age 55 or older to begin receiving it.) See page 8.37 for an
             explanation of "present value."

          o  At least age 55 with five or more years of vesting service.

          o  At least age 65 with one or more years of vesting service.

          Refer to the section "If you stop working at Digital" on page
          8.11 for more information on how you can collect your vested
          pension if you leave Digital before retiring.

    

    hope this isn't too far off the subject...
    
    If you die before you reach retirement age (which I probably will), 
    are pension benefits paid to your benefeciary or are they retained by
    the company/trust/whatever?
    
    "jackin' the house", Bob (who's 16-year DEC anniversary is next week,
    				but is STILL waiting for his 15-year award
    				despite repeated requests to management for
    				the past YEAR!!!!)
    
    

    	There are two "modes" of payment if I understand it correctly, one
    where the benefit is paid only to you and the other, a lesser amount,
    which will be paid to you or to your spouse if you die before
    retirement age. The default is the latter method, but you can select
    the former with Personnel if you want.

From 1991 Benefits book:

"If you are married and die before retiring, federal law has given your 
current spouse (unless otherwise required by a Qualified Domestic 
Relations Order, see page 8.37) the right to a portion of your vested 
pension benefit.  For more information, see page 8.13.

If you are married and die after retiring but before receiving your 
pension, your spouse is entitled to half the benefit you would have 
received if you had elected a Joint with 50% Survivor Income Option.  
This is true even if you had previously selected another option.

If you are single and die before retiring, you pension benefit will be 
forfeited.

If you are single and die after retiring but before receiving your 
pension, your pension benefit will be forfeited.

If you are married or single and die after retiring and after your 
payment(s) have begun, only a named beneficiary of a Joint with Survivor 
Benefit will continue to receive your pension benefit.  If you had taken 
your benefit as a lump sum or a life income, no further benefits will 
be paid.  See pages 8.21 through 8.26 for more details."

Mac