Pension Fund Top FAQ’s

HOW LONG DO I HAVE TO WAIT TO BECOME A PARTICIPANT OF THE UFCW CONSOLIDATED PENSION FUND?
If you are an employee of an employer who has been approved by the Board of Trustees that has agreed to make contributions to the Consolidated Pension Fund on your behalf and you have reached the age of twenty-one (21), you will become a Participant on the first day of the month following the month in which you earn  (1) year of Eligibility Service.

WHAT IS THE DIFFERENCE BETWEEN ELIGIBILITY SERVICE AND CREDITED SERVICE?
Eligibility Service is used to determine whether you qualify for Plan benefits. Generally, you receive a Year of Eligibility Service and Credited Service for each calendar year in which you have 400 or more hours of service. Past credited service is service for employment prior to the date your employer joined the Plan. Eligibility Service and Credited Service under one of the pre-merger or transferred plans counts towards your eligibility and benefits. Credited Service is used to calculate the amount of your benefit from the Plan. Credited Service is based on work in covered employment during each calendar year.

WHEN AM I VESTED?
You become vested based on your Eligibility Service. You earn one (1) year of Eligibility Service for each calendar year in which you have at least 400 hours of service, including service for a contributing employer not covered by the collective bargaining agreement. To become vested in the UFCW Consolidated Pension Fund, you must earn at least five (5) years of vesting with a participating employer. Once you have earned at least five (5) vested years, then you are eligible for a retirement benefit at your normal retirement age.

CAN I BORROW FROM MY PLAN?
No. This plan does not allow for borrowing.

HOW IS MY BENEFIT CALCULATED?
 Your benefit earned under the Consolidated Fund is calculated based on your hours, pay, Consolidated Fund normal retirement age, and any early retirement reductions.  The Consolidated Fund benefit is pay-based and is a percentage of your gross pay for each year:  0.75% of gross pay for the first five years of service and 1.0% of gross pay for service over five years.  The benefit is determined for each year, and then all of the years are added together for your total Consolidated Fund benefit.  Annual amounts are divided by 12 to produce the monthly pension benefit.

The pension calculation for the Consolidated Fund is more complex if you had service under one of the pre-merger plans or a transferred plan.  Your pre-merger or transferred plan benefit is calculated based on the rules of that plan, including how many hours are required for a year of service, the accrual rate, contribution rate, the normal retirement age, and any early retirement reduction.  Benefit calculations based on the terms of the prior plan are added to the Consolidated Fund benefit to determine your total benefit amount. 

WHAT IS A REQUIRED DISTRIBUTION OF BENEFITS?
Once a participant reaches the age of 70-1/2 and has five (5) or more years of eligibility service, the Fund is required to start the distribution of your benefit on the April 1st following your attainment of the age of 70-1/2. You may continue your employment, and there is no restriction on the number of hours you may work. If your employment continues with a participating employer and you earn any additional Credited Service, your benefit will be recalculated as of December 31 of each year and adjusted accordingly. There are also requirements with respect to the form and timing of death benefits.

HOW MANY YEARS DO I NEED TO BE ELIGIBLE FOR A BENEFIT UNDER THE CONSOLIDATED PENSION FUND?

NORMAL: 5 or more years of Eligibility Service and age 65.
EARLY: 10 or more years of Eligibility Service and age 65.
DISABILITY: 20 years of Eligibility Service is required with a Social Security Disability Award.

Benefits earned under a pre-merger or transferred plan are subject to the rules of those plans.  

HOW LONG WILL IT TAKE TO PROCESS MY APPLICATION?
Please apply at least four (4) months in advance of your proposed retirement date as it typically takes that amount of time to complete the application. If you are on an authorized sick leave due to a serious illness or injury, which could result in total and permanent disability, you should apply for benefits as soon as possible.

HOW WILL I KNOW WHEN I WILL BEGIN PAYMENTS?
You will receive a benefit election packet. This packet will include one or more benefit options. Unless otherwise stated, you may make one choice. The tax form and direct deposit form will be included in the packet.

WHEN WILL THE PAYMENT GO INTO MY ACCOUNT?
The money goes in your account on the first business day of the month if you have Direct Deposit. If the first day falls on the weekend or a holiday, it will be in your account on the following business day. If your account is closed or if you have provided incorrect bank information, the bank will reject the deposit and will notify us. Since automatic deposits can only be made once a month, a check will be mailed to you immediately after the bank returns the money. We will continue mailing your check until we receive a Direct Deposit Authorization form with the correct information.

DO YOU SEND A CHECK STUB IF THE BENEFIT IS DIRECT DEPOSITED?
No. The deposit will appear on your bank statement.

DO YOU WITHHOLD INCOME TAX?
We withhold Federal Income Tax if you do not specifically request otherwise. We do not withhold for state income tax. A W4P tax form will be provided before you start your pension to decide how much withholding you want the Fund to do. You may wish to make estimated state tax payments to avoid penalties. 

WHAT IS THE LEVEL INCOME OPTION?
This benefit option is offered if you are under the age of 62 at retirement. The monthly benefit that you will receive from this Fund until you reach the age of 62 will be higher than that of the early single life option but it will drop at the age of 62 to a lower amount than the early single life option. This benefit cannot be estimated until we have your yearly earnings to calculate the amounts.

The above description covers the general rules. There are special rules for participants that earned benefits in certain prior plans. Please see the summary plan descriptions for those prior plans for information.

The information contained on this website is general in nature.  Questions regarding your benefits should be directed to the LLC at the numbers provided. If there is a discrepancy between the terms of the UFCW Consolidated Pension Plan document (“Plan”) and the information contained within this website, the provisions of the Plan, as amended, will control.