For Catholic-affiliated organizations alone, about 1 million pensioners are now estimated to be at risk of having reduced or zero pension benefits due to a federal law that exempts religious organizations from providing regulated and guaranteed pensions.
“It’s estimated to be about a million,” Dara Smith, senior attorney for the AARP Foundation, which advocates for older Americans, told The New York Times in a recent interview. And “that one million figure’s estimated to just be Catholic-affiliated organizations,” she added. The number of pensioners affected at other church-affiliated organizations is unknown.
The federal law at issue, the 1974 Employee Retirement Income Security Act, sets minimum standards for most voluntarily established retirement and health plans in the private industry to provide protection for individuals in these plans.
The law, however, does not cover plans established or maintained by governmental entities, churches for their employees, or plans which are maintained solely to comply with applicable workers compensation, unemployment or disability laws.
A church plan, the Pension Rights Center explains, can also be broadly defined to cover employees of hospitals, schools, and other nonprofit organizations that are associated with that church. A plan that is maintained by an organization associated with a church that has as its principal function the administration and funding of a pension plan, can be treated as a church plan.
Many retirees of organizations with church-affiliated plans, like Ralph and Rosemarie Bryden of Rhode Island, are now beginning to feel the pain of that lack of protection for employees of religious-affiliated organizations under the law.
The Brydens, along with 2,700 other pensioners who worked for St. Joseph Health Services, are facing reduced or eliminated payments because the Roman Catholic Church allegedly failed to fund their pensions.
“We used to go traveling,” Rosemarie Bryden, 69, told the Times. “Since things started, we stopped with a lot of other frivolous things.”
Unlike the Brydens, some retirees who feel cheated by “church plans” are now fighting back.
Earlier this summer, NJ.com reported that more than 100 retirees of the now defunct St. James Hospital of Newark, filed a lawsuit against the Newark Archdiocese, alleging that they lost their pensions because the archdiocese mismanaged the fund.
Full story at The Christian Post.
I’d be willing to make a wager the Employee Retirement law of 1974 is really only an excuse for mismanagement over the decades. The financial management realized the pension obligations were accumulating. Yet the same management failed to invest annual payments to accumulate over the years.
Good for those in Newark suing the Archdiocese. Maybe some of the empty churches or other real estate have value to help pay what is owed these people.
This is criminal and a SIN! To treat these people, who labored in the vineyards” on behalf of the mission of Christ’s Church, is absolutely unacceptable. The Church is one of the top three wealthiest organizations in the world. Some of its resources should be used to rectify this unjust situation.
I retired in 2011 from a 45 year career in nursing (RN). I have zero pension but I took responsibility and put money in my 403(b). I did not depend on others to take care of me.
ERISA lays out the requirements for various employee retirement plans. They were designed to protect an employee’s pension, especially defined benefit plans. After Congress passed the tax-deferred savings plans, many if not most companies stopped funding their deferred plans and no longer enrolled new employees. This is not true for many union plans and government plans. Most working people today do not have defined benefit plans and retirees are dieing quickly, so the plans will soon be nonexistent. The problem with defined plans that still exist is that small companies and nonprofits haven’t made their required annual payments to the plans. The unfunded liability is in the billions of dollars. For a church to do that to its employees is a moral issue.
Certain Catholic hospitals actually converted
their pension plans from ERISA plans, which
have insurance for employees whose pensions
fail, and mandatory minimum funding requirements, to so called “church plan” pensions which have neither.
Plan participants were not even told, in some instances, that these changes were made.
As to the above nurse who funded her own pension-good for you!
But many of us took jobs where a pension was part of our compensation.
“The Churches” of “Church Plan Pensions” need to be held accountable for these promised benefits.
No surprise , the variety of abuses of the laity and now their staff is to be expected , the payouts , financial mismanagement and excess of certain bishops and cardinals is the a big if not the only cause of this. Look for a new appeal to help these people out with no transparency or accountability, as an example look at how Bishop mcgrath of San Jose was set to retire before the outcry, the diocese is 250 million dollars in debt .