A new PRC fact sheet refutes claims made by Saint Peter’s University Hospital (SPUH) that its pension plan is a church plan and has never been subject to federal law. On Monday, SPUH president and CEO Ronald C. Rak sent a letter informing all pension plan participants that their pension, despite decades of actions and written assurances to the contrary, was never covered by the Employment Retirement Income Security Act of 1974, the nation’s private pension law.
This letter is the latest move made by the hospital to shirk its responsibilities to its employees and boost its bottom line – at the expense of its employees’ retirement security.
Church plan status would wipe out all federal protections for the participants’ pensions, including the all-important pension insurance protection provided by the Pension Benefit Guaranty Corporation (PBGC). Because the SPUH pension plan is only 63 percent funded, lack of insurance protection means that participants could lose their hard-earned benefits if the plan terminates without PBGC insurance. Read our fact sheet to learn more about why the distinction between an ERISA plan and a church plan is so important.
Many of the Saint Peter’s employees and retirees I have spoken with feel that by denying them these important protections Saint Peter’s is turning its back on them.
While outrageous and unfounded, this letter should be taken seriously. That’s why we have released a fact sheet, Saint Peter’s University Hospital Retirement Plan: The law and the facts, disputing SPUH claims that its pension plan was never covered by ERISA.
SPUH employees and retirees are currently awaiting notification from the Internal Revenue Service about whether it has deemed their pension plan a church plan. In the meantime, they are keeping active on their blog, Save Your Saint Peter’s Retirement Plan, and contacting the media to voice their concerns.
They have also done some research and discovered that the chair of the SPUH Board of Trustees is none other than Donald M. Daniels, who served as CEO of Cathedral Healthcare System, which was affiliated with the Hospital Center at Orange when it sought and won approval from the Internal Revenue Service to convert the Hospital Center at Orange’s pension plan into a church pension plan. Participants in the Hospital Center at Orange pension plan have learned that their pension plan will run out of money to pay their pensions in two years if pension insurance protection is not restored to their plan.
At the Pension Rights Center, we think Saint Peter’s claims that its pension plan was never covered by ERISA are baseless. Because these claims could be confusing to participants who have been repeatedly told that their pensions are fully protected by federal law, we have released our fact sheet, Saint Peter’s University Hospital Retirement Plan: The law and the facts, to set the record straight.