Summary Plan Description (Revised January 1, 2012)
Future service refers to credited service under this plan since January 1, 1960. The monthly benefit earned for each year of credited service is based on the following two equations:
(1) Total Hours Reported x Hourly Contribution Rate = Total Contributions For That Year 2,000 Hours x $3.04/Hour = $6,080.00
(2) Total Contributions x Benefit Factor = Monthly Benefit Earned For That Year $6,080.00 x .015 (1.5%) = $91.20
In the example above, the $6,080.00 in contributions for that year generates a $91.20 monthly income payable for life. Your total monthly benefit is the sum of the monthly benefits earned each year since 1960 plus any past service, if applicable. Please see Benefit Statements for an example of how a monthly benefit earned for each year of credited service generates a total monthly benefit.
The factors that determine your future service benefit are discussed below.
Your total monthly benefit available at retirement is the sum of the monthly benefits you earn each year you participate in this plan. In the example above, $91.20 was earned during one year of participation in this plan. If you worked for 20 years with the same variables, the sum of those 20 years would generate a total monthly benefit of $1,824.00.
20 Years x $91.20 Per Year = $1,824.00 Total Monthly Benefit
Of course, the annual benefit earned each year varies depending on the number of hours you work, the hourly contribution rate and the benefit factor. These variables are discussed below.
Hourly Contribution Rate
Employers signatory to collective bargaining agreements with the Pacific Northwest Regional Council of Carpenters are required to make an hourly contribution to this plan and the Carpenters of Western Washington Individual Account Pension Plan for each compensable hour. The hourly contribution rate is determined by collective bargaining and is subject to change. The Board of Trustees allocate the hourly contribution between the two pension plans.
The hourly contribution rate to this plan is reduced by the following surcharges:
- Rule of 80 Surcharge – The amount of this surcharge is determined by the Trustees based upon the recommendation of the actuary. This surcharge is 16.7% of the hourly contribution less the funding surcharge (please see below). This surcharge is used to help fund rule of 80 early retirement. You do not earn a benefit on this part of the hourly contribution.
- Funding Surcharge – This surcharge is 26% of the hourly contribution, not to exceed $1.25 per hour. This surcharge is used to help decrease the unfunded liability of the plan. You do not earn a benefit on this part of the hourly contribution.
The net hourly contributions are used to calculate your monthly benefit.
Hourly Contribution Rates
The "Hourly Contribution" (third column) is the dollar amount contributed by signatory employers for each compensable hour. The "Rule of 80 Surcharge" (fourth column) is the amount subtracted from the "Hourly Contribution" to help fund rule of 80 early retirement. The "Funding Surcharge" (fifth column) is the amount subtracted from the "Hourly Contribution" to help decrease the plan's unfunded liability. The "Net Hourly Contribution" (sixth column) is the portion of the hourly contribution rate that generates the monthly benefit.
|From||To||Hourly Contribution||Rule of 80 Surcharge||Funding Surcharge||Net Hourly Contribution|
Table 1 lists the hourly contribution rates from 1960-2011.
- For additional information about the hourly contribution rate, please see Article 1.4 and Article 6.1.2.
Your total hourly contributions for each year of credited service are multiplied by a benefit factor which converts these contributions into a monthly benefit. Table 2 lists the benefit factors from 1960- 2011. The benefit factor has varied during the history of this plan but is presently set at 1.5% for 2008 and future years. The benefit factor is based on the investment performance of the plan, employment and retirement trends experienced by the plan, and the overall retirement and mortality experience of the plan. The benefit factor for each upcoming plan year is determined by the Board of Trustees in consultation with the plan's actuary. The Trustees reserve the right to increase or decrease the factor depending on the actuarially requirements of the plan.
The benefit factor is presently set at 1.5% for 2008 and future years. The benefit factor for the upcoming plan year is determined by the Board of Trustees in consultation with the plan's actuary. The benefit factor is based on the investment performance of the plan, employment and retirement trends experienced by the plan, and the overall retirement and mortality experience of the plan. The Board of Trustees can increase the benefit factor retroactively if it determines the appropriate funding is available. Benefit factors cannot generally be decreased retroactively.
Most participants qualify for the improved benefit factors listed in Table 2. However, if you worked some time during the years 1960 through 1987 and did not have 750 covered hours between 1986 through 1988, your benefit is calculated based on the standard benefit factors listed in Table 2. From 1988 forward, the benefit factors in both tables are the same.
- For additional information about the benefit factor, please see Article 6.1.2(b).
If you were active in this plan (and not retired before January 1, 1989) and earned at least 750 hours of covered service in this plan in the three plan years 1986-1988, then your benefit for the years of service shown below are calculated using the improved benefit factors.
If you were active in this plan but did not earn at least 750 hours of covered service in this plan in the three plan years 1986-1988, or if you retired before January 1, 1989, then your benefit for 1960- 1987 is calculated using the standard benefit factors.
Benefit factors for 1988 through the present are the same for all participants.
|From||To||Benefit Factors – Improved||Benefit Factors – Standard|
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