FYI,
Pension issues that have heard that cause great confusion. USERRA does not allow FEDEX (any employer) to make any pension contributions until you return to work. Why? It is to prevent someone from getting unfair advantage over an employer if they do not return. i.e. I work at the XYZ plant, take a 2 year military OIF vacation, then before I return to the XYZ plant, am offered a much better job at ABC company and go there to work instead of XYZ. USERRA prevent you from receiving those pension benefits at XYZ because it is also a REemployment rights act, if you voluntarily do not return to the original employer (XYZ), nothing applies including pension restoration. So Fedex is not allowed to make those pension payments until you return from Military (this really should only be an issue for anything over 30 days in practical terms). Also why I mentioned that someone who upgrades etc while on long term mil needs to 'assist' payroll in proper payment of the pension. It is a very manual process and Uncle Sam knows it is cumbersome.

 

[quote=SaltyDog;522765]FYI,
Pension issues that have heard that cause great confusion. USERRA does not allow FEDEX (any employer) to make any pension contributions until you return to work.


I may be wrong, but I believe that the employer MAY make the contributions in the employee's absence, but is not obligated to do so (unless there is a contractual obligation.)

 

Not a military guy myself but have a buddy here at Big Brown who came from a legacy airline and the other day he said IPA was very helpful when it came to MLOA issues; way more than the union at his previous carrier. He actually complemented the company too on some of those issues. Not sure if that's the norm but it should be...

 

[QUOTE=navigatro;522780]navigatro,
You may be correct, however, it is open to more interpretation by the IRS in the Internal Revenue Code (IRC) and thus based my comments in part on USERRA and Final rules summed up best by one of the authors of USERRA who presented this review regarding contributions. It is related because it talks about the timing of the contributions. Also, the FEDEX PMPPP letter from Oct 2006 covered short term mil leave (UPS addressed in 1998) restorations and timing. In any case, USERRA clearly says "not required" till return <g>

LAW REVIEW 0741 (July 2007)
CATEGORY: USERRA—Pension
Am I Permitted to Make Up Missed Employee Contributions to My Pension Plan Account after Leaving the Employ of My Pre-Service Employer?

By CAPT Samuel F. Wright, JAGC, USN (Ret.)

Q: I have enjoyed reading your Law Review articles about the Uniformed Services Employment and Reemployment Rights Act (USERRA). I have read all the articles about section 4318 of USERRA, as it applies to pension benefits through one’s civilian job, and I do not find an answer to my specific question.

I had been employed by the XYZ Corp. for five years before I was called to active duty for two years. I was recently released from active duty under honorable conditions. I have not yet applied for reemployment at XYZ, but I still have plenty of time to do so within the 90 days (after the date of release from active duty) that the law allows me. I am trying to decide whether to apply for reemployment at XYZ, as I have an offer from ABC, in the same city, for a job that pays substantially better.

I would accept the ABC offer in a moment, but I am concerned about losing my built-up retirement benefits at XYZ. That company has a contributory-defined contribution pension plan. During the five years that I worked for the company, before I was recalled to active duty, I made employee contributions (actually called “elective deferrals” because they were made with pre-tax earnings). As I understand section 4318 of USERRA, I am entitled to make up the missed elective deferrals (employee contributions) within a period that starts on the date of my reemployment and extends for three times the duration of my most recent period of service in the uniformed services (but not more than five years), and then to receive the employer matches on those makeup contributions.

Let us say that I make a timely application for reemployment at XYZ and return to work there in June 2007, but resign in August 2007 to take the ABC job offer. Am I permitted to continue making makeup contributions to the XYZ pension plan, and continue receiving XYZ employer matches, through June 2012 (five years after my return to work)?

A: Probably not. The Department of Labor’s final USERRA regulations, published in Code of Federal Regulations (CFR), at title 20, part 1002, have a subsection that specifically addresses your question: “If the employee is enrolled in a contributory [pension] plan he or she is allowed (but not required) to make up his or her missed contributions or elective deferrals. These makeup contributions or elective deferrals must be made during a time period starting with the date of reemployment and continuing for up to three times the length of the employee’s immediate past period of uniformed service, with the repayment period not to exceed five years. Makeup contributions or elective deferrals may only be made during this period and while the employee is employed with the post-service employer” 20 CFR 1002.262(b)) (emphasis supplied). It appears, based on the italicized language above, that your plan will not work. If you want to make up the missed elective deferrals and get the employer matches, you will need to remain employed at XYZ for the entire five-year period, or at least long enough to make up the missed elective deferrals. Your contributions to the XYZ pension plan must be made from XYZ earnings. "

If you dig into the Final Rules, the DOL did comment on allowing employees to make pension contributions based on the "differential pay" since 1) USERRA did not require the extra compensation and b) only allowed the contribuyions on the "differential" pay, and not what would be earned by the employee if they were not on military leave (your regular pay that sets your pension restoration which is paid upon reemployment)
It is summarized by these statement in Final Rules
"Page 75280 USERRA Final Rules Pension Plan comments

“The Department received one comment concerning pension plan entitlements of employees whose employers provide them with partial or full civilian pay while the employees
are absent from employment to perform military service. This compensation is commonly referred to as ‘‘differential pay,’’ and the amount and duration of the benefit varies widely. The commenter asked the Department to indicate whether employees who receive ‘‘differential pay’’ are entitled to make employee contributions or elective deferrals to their pension plan based on
the differential pay received while absent from employment to perform military service. The Department notes that ‘‘differential pay’’ is not required by USERRA, and is a form of compensation from employers to employees. The Department of the Treasury (Treasury Department) and the Internal Revenue Service (IRS) issued proposed regulations that address the ability of employees on military leave to make pension contributions based on differential pay.
These proposed regulations can be found at 70 FR 31214–0 (May 31, 2005), and interpret the provisions of section 415 of the IRC, which governs benefits and contributions under qualified retirement plans. The Treasury Department’s press release concerning the proposed rule states, in pertinent part:
Significantly, the proposed regulations will specifically provide that National Guard and Reserve members are permitted to continue to contribute to their employer’s retirement
plan while on active duty. . . The rules relating to post termination compensation and the associated clarifications on the ability to contribute to retirement plans for members of the National Guard and Reserve will also apply to section 403(b) tax deferred annuities and Section 457 eligible deferred compensation plans. Plan administrators may rely on today’s proposed regulations
immediately to allow service members to contribute to qualified retirement plans. JS–2471, Office of Public Affairs, Department of the Treasury, May 25, 2005.”

Finally, if you are still awake and a FEDEX bubba, this certainly is in play and of interest.

LAW REVIEW 0703
CATEGORY: USERRA—Pension

USERRA’s Pension Rules Apply to Short-Term Military Periods (FEDEX Reference)

By CAPT Samuel F. Wright, JAGC, USNR (Ret.)

The Uniformed Services Employment and Reemployment Rights Act (USERRA) gives you the right to time off from your civilian job for voluntary or involuntary service in the uniformed services. If you meet the USERRA eligibility criteria (summarized in Law Review 77), you are entitled, upon your return from service and timely application for reemployment, to be promptly reemployed (generally, within two weeks after your application, and immediately after a short-term tour of duty like a drill weekend). Upon your reemployment, you are entitled to be treated, for seniority and pension purposes, as if you had been continuously employed during the period that you were away from work for service.

The term “service in the uniformed services” is defined in section 4303(13) of USERRA, 38 U.S.C. 4303(13). The definition is broad—it includes active duty, active duty for training, inactive duty training (drills), and initial active duty training. A period of service in the uniformed services, protected by USERRA, can be anything from five hours to five years.

Most employers have come to understand the obligation to make up missed employer pension contributions, and to give the returning employee the opportunity to make up missed employee contributions, after a lengthy period of military service—like an 18-month callup to active duty. Many employers have resisted making these arrangements for short tours of military duty, like drill weekends and two-week annual training tours. Employer personnel offices complain about the administrative burden of accommodating several short tours of military duty in the same year; but “too hard” is not a defense under USERRA.

I invite the reader’s attention to my Law Review 107, entitled “Pension Entitlements Apply To Training Duty.” I have long taken the position that section 4318 of USERRA applies equally to short tours and longer tours of military duty or training, and now the Department of Labor (DOL) USERRA Regulations strongly support my position. I invite the reader’s attention to 20 CFR (Code of Federal Regulations) 1002.259. Making you whole, with respect to your civilian pension, for a single drill weekend may seem to be much ado about not very much, but if you spend a career in a Reserve component, and spend the same time employed by a civilian employer, the cumulative effect of multiple short military-related absences from work could become quite significant.

I have good news to report. An ROA member who is employed by the Federal Express Corporation (FedEx) as a pilot has sent me a copy of a FedEx notice dated October 2006 and entitled “Important Information about the Federal Express Corporation Pilots’ Money Purchase Pension Plan: Contribution to the Plan Due to Short Term Military Leave.” The notice provides as follows:

“The primary federal statute governing employment-related issues for servicemen who are required to miss civilian work in order to perform military service is the Uniformed Services Employment and Reemployment Rights Act of 1994, as amended (USERRA). Among many other things, this statute governs the provision of retirement benefits, including the Federal Express Corporation Pilots’ Money Purchase Pension Plan (PMPPP), for pilots who return to work following periods of qualifying military leave. The Company understands USERRA to require PMPPP contributions to be made for pilots who return to work following periods of qualifying military leave. The Company understands USERRA to require that PMPPP contributions be made for pilots who return to work following periods of qualifying military leave even though they are not paid while taking that leave.

For short-term military leaves, trips in conflict with military leave are removed without pay and the credit hours removed go into the pilot’s make-up bank and are available to be flown in make-up status at a later date. Since trips dropped due to military leave could be made up following the pilot’s return to work, it was once thought that PMPPP contributions could be made at the time the pilot flew the make-up trip. However, the USERRA regulations suggest that those contributions should be made within 90 days of the date on which the pilot returns to work from a qualifying military leave, regardless of whether the pilot flies any make-up that can be traced to trips dropped due to military leave.

With this clarification in interpretation of USERRA requirements, FedEx is making a corrective contribution to your PMPPP account for the period(s) of time you were on a short-term military leave beginning June 1, 1999 through August 31, 2006. The contribution is based on lost pay as a result of your dropped trip(s) while you were on short-term military leave. … On a prospective basis, beginning with leaves that were completed in September 2006 or afterward, PMPPP contributions will be processed within 90 days of the date on which the pilot returns from a qualifying short-term military leave.”

FedEx has now corrected its USERRA violation, at least on this issue. Now is the time for other employers, large and small, to make similar corrections.

Military title shown for purposes of identification only. The views expressed herein are the personal views of the author, and not necessarily the views of the Department of the Navy, the Department of Defense, or the U.S. Government"

 

I avoid taking extended mil leave like the plague. It affects medical, jumpseating, and vacation accrual, perhaps even other things. I'd much rather drop trips, since it's leave without pay anyway. And we all know dropping trips nowadays is a piece of cake since they get scooped up within minutes.

Raw deal for serving your country.

 

4. MLA (B Funds and CASS)
A. CASS access while on MLA: We have obtained approval to make this happen and currently wait for the software coding to be changed. My goal is to have this complete before the end of the
current FedEx fiscal year.

Looks like this got addressed. Thanks to our Block reps for bringing this to the company's attention. I know I emailed Albie and our mil and jumpseat reps on this one. Thanks for the work. Thanks also to O for putting that out. I've only met O once, but from what I've heard and read from him, I think he does a great job when he can within the limits imposed on him.

I assume the fiscal year is the end of Sept? While I'm happy to see the policy changed, can't we change the "software coding" sooner than that?

Fred

 

If you are riding in the cockpit you have to be a working crewmember for a airline according to the FAA. They do not consider Mil leave as a working crewmember. Sadly the airlines have to follow that rule. I think all airlines remove long term Mil leave from Cass.

 

Negative Fred. I'm pretty sure the end/beginning of the Fedex fiscal year is the end of May/ June 1st. Hopefully, it will only take that long to fix the problem. Of course, it's a software change - it should and would be fixable in a couple of days if it would benefit the company.

 

Sadly your comments are incorrect.

 

Why is it sad that his comments are incorrect?