The IRS private letter ruling that granted "church plan" status to Saint Peter's pension plan is here... though the odd "Mad Libs" style used by the IRS makes it nearly incomprehensible. Pension Rights Center has provided a version of the letter which is much easier to understand; it makes all the proper substitutions and highlights some of the more pertinent passages.
Karen Ferguson of the Pension Rights Center has published this memo which analyzes the IRS's decision and clarifies where we go from here. We urge all interested parties to read and distribute the memo.
Pending the result of the ongoing class action suit ‒ and the probable subsequent appeal ‒ the IRS ruling leaves the pension plan without the protections previously provided under federal law. It allows SPUH to fund (or continue to under-fund) the plan as they see fit and to stop insuring the plan against default. The decision allows the hospital to save a large sum of money on a continuing basis, at the expense of the financial security of its employees and retirees.
The (Middlesex County) Home News Tribune carried a story about the IRS ruling on August 29th. In it, SPUH attorney Jeffrey Greenbaum repeats an often-used SPUH claim that the ruling doesn't allow the hospital system to take money out of the pension plan. This of course misrepresents plan members' concerns: we aren't worried about the hospital taking money out; we're worried that they won't put enough money in to keep the plan solvent. Retiree Monica Mosley echoes the concerns of many members: "They would like to say they’re a church plan since 1974, but when I was working for them, they said they were ERISA. Why should I believe what they tell me now?” Another story on the ruling by Hazel Bradford has been published in Pensions & Investments.
In other news, SPUH recently updated its Social Media Policy. It contains a (likely new) requirement that if an employee "is contacted by a blogger, online journalist or media representative about the business of the organization ... he/she must notify their reporting manager and the Marketing/Communications leadership before responding." This is significant, given recent instances of SPUH firing employees for the smallest policy infractions.
The management of Saint Peter's University Hospital is using the church to exempt itself from the Federal safeguards that protect your retirement plan. For an introduction, see Your Pension At Risk.
