Benefits » Retirement » TCP1 Defined Benefit Pension Plan
Under the Total Compensation Package (TCP) 1 Defined Benefit Pension Plan (DBPP) Los Alamos National Security, LLC (LANS) contributes toward your retirement income based on your age, service credit, and your highest-average salary (HAPC) at retirement. In general, the older you are and the more service credit you have at retirement, the higher your retirement income will be. Your monthly retirement income will be affected by whether you choose to provide a monthly retirement benefit for your spouse or other contingent annuitant. The TCP1 plan also includes a provision for disability benefits, survivor income, and death benefits. LANS does not stipulate a maximum retirement age.
While the LANS total compensation package is designed to be substantially equivalent in the aggregate to the University of California’s compensation package, the TCP1 DBPP reflects changes required by the federal Employee Retirement Income Security Act (ERISA). Therefore, the TCP1 pension plan is not identical to the University of California Retirement Plan (UCRP). Direct comparisons with University of California pension data will need to consider the ERISA requirements and the compensation packages as a whole, he said. In addition, individual pension differences can be caused by the specific pension options chosen and the age differences between individual retirees and their contingent annuitants.
The LANS plan offers several advantages over the UCRP, such as allowing employees more flexibility in choosing retirement dates. LANS modified UCRP’s cost-of-living-adjustment (COLA) requirements, for example, and removed penalties for choosing a pension date other than July 1. In addition, under LANS the highest-average plan compensation is adjusted on a pro-rata basis for inactive members who had at least an hour of service after June 28, 2007, no matter when these members elect to begin receiving their pensions. Under the UCRP, adjustments to an inactive member’s highest-average plan compensation were made only once a year, effective July 1.
LANS also provides an ERISA-required 50% pre-retirement survivor benefit for spouses of vested members who die before becoming eligible to retire compared with a 25%-of-final-salary guarantee under the UCRP.
An additional benefit is that as an employer offering ERISA-compliant benefit plans, LANS is required to provide notices and reports to employees throughout the year. Generally, the reports are informational only, and no action is required on the part of the employee. Employees can view the current reports on LANL’s ERISA Reports and Special Notices webpage.
Eligibility and participation information is available on page 2 of the Summary Plan Description (pdf).
The TCP1 DBPP plan provides for future employee contributions, if required, in a manner similar to the UCRP. However, LANS has no current plans to require employees to contribute to the pension plan.
The payment methods available under the TCP1 DBP are described on page 12 of the Summary Plan Description (pdf).
With the addition of a 75% Joint and Contingent benefit option to the LANS plan beginning January 1, 2008, as required by the recently passed Pension Protection Act, LANS retirees will have even greater flexibility in selecting a suitable benefit payment amount.
Questions? Contact the Lab’s Benefits Office at 505-667-1806.