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Normal Retirement
Early and Disability Retirement
Fall 1959
Bulletin N o . 1284
UNITED STATES DEPARTMENT OF LABOR
Arthur J. Goldberg, Secretary
BUREAU OF LABOR STATISTICS
Ewan Clague, Commissioner
PENSION PLANS
UNDER COLLECTIVE BARGAINING
Normal Retirement
Early and Disability Retirement
Fall 1959
Bulletin No. 1284
February 1961
UNITED STATES DEPARTMENT OF LABOR
Arthur J. Goldberg, Secretary
BUREAU OF LABOR STATISTICS
Ewan Clague, Commissioner
For sale by the Superintendent of Documents, U .S . Government Printing Office, Washington 25, D .C .
Price 40 cents
Preface
The p rin cip a l fe a tu re s o f n o rm a l, ea rly , and d is a
b ility re tire m e n t p r o v is io n s o f 300 s e le cte d p en sion plans
under c o lle c tiv e bargain in g a re analyzed in this bulletin —
the secon d in a s e r ie s of p en sion plan stu dies. The f ir s t
re p o r t (B L S Bull. 1259, July 1959) analyzed the vestin g and
involuntary re tire m e n t p ro v is io n s of the sam e 300 plans.
A subsequent r e p o r t w ill co v e r death b en efits and s u r
v iv o r option s.
The 300 plans studied ranged in co v e ra g e fr o m a
thousand to s e v e ra l hundred thousand w o r k e r s .
In total,
a p p rox im a tely 4. 7 m illio n w o r k e r s under c o lle c tiv e b a r
gaining w ere co v e re d , or about h alf o f the estim ated num
b e r of w o r k e r s co v e r e d by a ll p en sion plans under c o l l e c
tive bargain in g in the United States.
The p ro v is io n s o f
these plans do not n e c e s s a r ily r e fle c t the p ro v is io n s o f
s m a lle r plans under c o lle c tiv e bargain in g o r in n on
union situ ation s.
Sum m ary a r tic le s of this study a pp eared in the
O ctober and N ovem ber I960 iss u e s of the M onthly L abor
R eview .
A few m in or d iffe r e n ce s in the data re p o rte d ,
due to la ter r e v is io n s , w ill be found in this fin al bulletin.
The study was conducted and this b ulletin was
p rep a red in the B u rea u 's D ivision o f W ages and Industrial
R elations by W alter W. K olodru betz and H arry L. Levin,
under the su p erv ision of Donald M. Landay.
in
Contents
Page
N o r m a l r e t ir e m e n t _________________________________________________________________________
S c o p e o f s t u d y ___________________________________________________________________________
R e q u ir e m e n ts f o r p a r t i c i p a t i o n -----------------------------------------------------------------------------------R e q u ir e m e n ts f o r n o r m a l r e t ir e m e n t b e n e fit s --------------------------------------------------------N o r m a l r e t ir e m e n t b e n e fit f o r m u la s ------------------------------------------------------------------------P a s t s e r v i c e b e n e fit fo r m u la s _____________________________________________________
B a s ic b e n e fit f o r m u la s ______________________________________________________________
A d ju s tm e n t o f p r iv a t e p la n b e n e fit s to s o c i a l s e c u r it y b e n e fit s _________________
E a r n in g s and s e r v i c e f o r m u la s ___________________________________________________
B e n e fits r e la t e d to s e r v i c e ________________________________________________________
F la t b e n e fit f o r s p e c if ie d s e r v i c e ________________________________________________
M in im u m b e n e fit f o r m u la s ________________________________________________________
V a r ia b le b e n e fit s ____________________________________________________________________
L e v e l o f b e n e fits ________________________________________________________________________
C h a n g es s in c e 1952 _________________________________________________________________
E a r ly and d is a b ilit y r e t i r e m e n t __________________________________________________________
S c o p e o f s t u d y ________________________________________________________________________ -—
E a r ly r e t ir e m e n t b e n e fit s _____________________________________________________________
R e q u ir e m e n ts f o r e a r l y r e t i r e m e n t ______________________________________________
A m ou n t o f b e n e fit s __________________________________________________________________
S o c ia l s e c u r it y a d ju s tm e n t o p tio n ________________________________________________
S p e c ia l e a r ly r e t ir e m e n t b e n e fit s ________________________________________________
D is a b ilit y r e t ir e m e n t b e n e fit s _______________________________________________________
R e q u ir e m e n ts f o r d is a b ilit y r e t ir e m e n t _________________________________________
B e n e fit fo r m u la s ___________________________________________________________________
D e d u ctio n o f s o c i a l s e c u r it y d is a b ilit y b e n e fit s ________________________________
R e co m p u ta tio n o f d is a b ilit y b e n e fit s ______________________________________________
L e v e l o f b e n e fit s ____________________________________________________________________
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T a b le s :
1.
2.
3.
4.
5.
6.
7.
8.
D is t r ib u tio n o f p la n s s tu d ie d b y n u m b e r o f w o r k e r s c o v e r e d
and m e th o d o f fin a n c in g ____________________________________ _____________________
D is t r ib u tio n o f p la n s s tu d ie d b y in d u s try g r o u p , m e th o d
o f fin a n c in g , and typ e o f b a r g a in in g u n it _____________________________________
M in im u m a ge and s e r v i c e r e q u ir e m e n t s f o r p a r t ic ip a t io n in
p e n s io n p la n s
_________________________________________________________________
P r e p a r t ic ip a t io n r e q u ir e m e n t s n ot c r e d it e d a s s e r v i c e f o r
e l ig i b i l it y f o r n o r m a l r e t ir e m e n t ______________________________________________
P r e p a r t ic ip a t io n r e q u ir e m e n t s n o t c r e d it e d a s s e r v i c e f o r
c o m p u ta tio n o f b a s ic n o r m a l r e t ir e m e n t b e n e fit __________________________
M in im u m r e q u ir e m e n t s f o r n o r m a l r e t ir e m e n t in s e le c t e d
p e n s io n p la n s u n d er c o l l e c t i v e b a r g a in in g
b y m e th o d o f
f i n a n c i n g ___________________________________________________________________________
M in im u m a ge and s e r v i c e r e q u ir e m e n t s f o r n o r m a l r e t ir e m e n t
in s e le c t e d p e n s io n p la n s
u n d er c o l l e c t i v e b a r g a i n i n g _____________________
P r o v i s i o n s f o r b a s ic and m in im u m b e n e fit s in s e le c t e d
p e n s io n p la n s u n d er c o l l e c t i v e b a r g a in in g
b y m e th o d
o f fin a n c in g and typ e o f b a r g a in in g u n it ____________________________________
v
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Contents — Continued
Page
T a b le
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T y p e s o f b a s ic b e n e fit fo r m u la s in s e le c t e d p e n s io n
p la n s u n d er c o l l e c t i v e b a r g a in in g
b y m e th o d o f fin a n c in g
and typ e o f b a r g a in in g unit --------------------------------------------------------------E a r n in g s b a s e u t iliz e d in e a r n in g s and s e r v i c e f o r m u la s -------P e r c e n t a g e f a c t o r u s e d in u n ifo r m p e r c e n t f o r m u la s and
r e d u c t io n b y p r i m a r y s o c i a l s e c u r it y b e n e fit , b y e a r n in g s
c o m p u ta tio n s u t iliz e d _________________________________________________
F o r m u la s w ith 2 o r m o r e p e r c e n t a g e f a c t o r s b y e a r n in g s
at w h ic h p e r c e n t a g e f a c t o r s ch a n g e ----------------------------------------------M on th ly b e n e fit s f o r e a c h y e a r o f c r e d it e d s e r v i c e and
m a x im u m y e a r s o f s e r v i c e a llo w e d b y p la n s p r o v id in g a
b a s ic b e n e fit v a r y in g b y s e r v i c e ---------------------------------------------------P la n s p r o v id in g a fla t b e n e fit f o r s p e c if ie d s e r v i c e
by
m o n th ly b e n e fit a m ou n t ______________________________________________
M in im u m b e n e fit p r o v i s io n s b y typ e o f b a s ic b e n e fit
fo r m u la _________________________________________________________________
P r o v i s i o n s f o r d e d u c tio n o f p r i m a r y s o c i a l s e c u r it y b e n e fit
f r o m m in im u m b e n e fit b y m e th o d o f fin a n c in g _______________
N o r m a l r e t ir e m e n t b e n e f i t s , in c lu d in g m a x im u m p r i m a r y
s o c i a l s e c u r i t y b e n e fit , f o r s e le c t e d e a r n in g s l e v e l s and
y e a r s o f fu tu r e c r e d it e d s e r v i c e
in s e le c t e d p e n s io n
________________________________
p la n s u n d er c o l l e c t i v e b a r g a in in g
A v e r a g e n o r m a l r e t ir e m e n t b e n e fit s and th e ir r e la t io n s h ip
to s e le c t e d e a r n in g s l e v e l s in s e le c t e d p e n s io n p la n s
u n d er c o l l e c t i v e b a r g a in in g ________________________________________
N o r m a l r e t ir e m e n t b e n e f it s , e x c lu d in g p r i m a r y s o c i a l
s e c u r it y b e n e f it , f o r s e le c t e d e a r n in g s l e v e l s and y e a r s
o f fu tu re c r e d it e d s e r v i c e
in s e le c t e d p e n s io n p la n s
u n d er c o l l e c t i v e b a r g a in in g ________________________________________
N o r m a l r e t ir e m e n t b e n e f i t s , in c lu d in g m a x im u m p r i m a r y
s o c i a l s e c u r i t y b e n e fit , f o r w o r k e r s e a r n in g $ 5 ,6 0 0 p e r
y e a r f o r 30 y e a r s o f fu tu re c r e d it e d s e r v i c e
b y typ e o f
b a r g a in in g u n it and m e th o d o f fin a n c in g
in s e le c t e d p e n s io n
p la n s u n d er c o l l e c t i v e b a r g a in in g _________________________________
N o r m a l r e t ir e m e n t b e n e f i t s , in c lu d in g m a x im u m p r i m a r y
s o c i a l s e c u r it y b e n e fit , f o r w o r k e r s e a r n in g $ 4 ,0 0 0 p e r
y e a r f o r 30 y e a r s o f fu tu re c r e d it e d s e r v i c e
b y typ e o f
b a r g a in in g unit and m e th o d o f fin a n c in g
in s e le c t e d p e n s io n
p la n s u n d er c o l l e c t i v e b a r g a in in g _________________________________
N o r m a l r e t ir e m e n t b e n e f i t s , in c lu d in g m a x im u m p r i m a r y
s o c i a l s e c u r i t y b e n e fit , f o r w o r k e r s e a r n in g $ 5 ,6 0 0 p e r
y e a r f o r 30 y e a r s o f fu tu re c r e d it e d s e r v i c e
b y typ e
o f b e n e fit fo r m u la u s e d to c o m p u te b e n e fit s
in s e le c t e d
p e n s io n p la n s u n d er c o l l e c t i v e b a r g a in in g _______________________
N o r m a l r e t ir e m e n t b e n e f i t s , in c lu d in g m a x im u m p r i m a r y
s o c i a l s e c u r it y b e n e fit , f o r w o r k e r s e a r n in g $ 4 ,0 0 0 p e r
y e a r f o r 30 y e a r s o f fu tu re c r e d it e d s e r v i c e
b y type
o f b e n e fit f o r m u la u s e d to co m p u te b e n e fit s
in s e le c t e d
p e n s io n p la n s u n d er c o l l e c t i v e b a r g a in in g _______________________
vi
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Contents—- Continued
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P r o v i s i o n s f o r e a r l y and d is a b ilit y r e t ir e m e n t in s e le c t e d
p e n s io n p la n s u n d er c o l l e c t i v e b a r g a in in g
b y m e th o d o f
fin a n c in g and typ e o f b a r g a in in g un it -----------------------------------------------------------P r o v i s i o n s f o r e a r l y r e t ir e m e n t in s e le c t e d p e n s io n p la n s
u n d er c o l l e c t i v e b a r g a in in g
b y in d u s tr y g r o u p , m e th o d
o f fin a n c in g , and typ e o f b a r g a in in g unit ----------------------------------------------------P r e p a r t ic ip a t io n r e q u ir e m e n t s n o t c r e d it e d a s s e r v i c e
f o r e l ig i b i l it y f o r e a r l y r e t ir e m e n t __________________________________________
M in im u m r e q u ir e m e n t s f o r e a r l y r e t ir e m e n t b y c o n s e n t
r e q u ir e d ___________________________________________________________________________
M in im u m a ge and s e r v i c e r e q u ir e m e n t s f o r e a r ly r e t ir e m e n t ---------------R e la tio n s h ip o f e a r ly r e t ir e m e n t to n o r m a l r e t ir e m e n t b e n e fit
f o r m u la s and m e th o d o f fin a n c in g b y r e d u c t io n f o r a g e _________________
T im e o f p a y m en t f o r e a r ly r e t ir e m e n t b e n e fit s
b y m e th o d o f fin a n c in g ________________________________________________________
L e v e l in c o m e o p tio n u n d e r e a r ly r e t ir e m e n t p r o v i s io n s
by m e th o d o f fin a n c in g ________________________________________________________
P r o v i s i o n s f o r d is a b ilit y r e t ir e m e n t in s e le c t e d p e n s io n
p la n s u n d e r c o l l e c t i v e b a r g a in in g
b y in d u s tr y g r o u p ,
m e th o d o f fin a n c in g , and typ e o f b a r g a in in g u n it ________________________
P r e p a r t ic ip a t io n r e q u ir e m e n t s n ot c r e d it e d a s s e r v i c e
f o r e l ig i b i l it y f o r d is a b ilit y r e t ir e m e n t ____________________________________
M in im u m r e q u ir e m e n t s f o r d is a b ilit y r e t ir e m e n t __________________________
M in im u m a ge and s e r v i c e r e q u ir e m e n t s f o r d is a b ilit y r e t i r e m e n t ______
P r o v i s i o n f o r d e d u c tio n o f s o c i a l s e c u r it y d is a b ilit y b e n e fit
f r o m d is a b ilit y r e t ir e m e n t b e n e fits
b y m e th o d
o f fin a n c in g _______________________________________________________________________
D is a b ility r e t ir e m e n t b e n e f it s , e x c lu d in g s o c i a l s e c u r it y
d is a b ilit y b e n e fit , f o r w o r k e r s 50 y e a r s o f a g e e a r n in g
$ 4 , 800 p e r y e a r f o r 20 y e a r s o f fu tu re c r e d it e d s e r v i c e
b y m e th o d o f fin a n c in g _________________________________________________________
D is a b ilit y r e t ir e m e n t b e n e fit s , in c lu d in g m a x im u m s o c i a l s e c u r it y
d is a b ilit y b e n e fit , f o r w o r k e r s 50 y e a r s o f a g e e a r n in g
$ 4 ,8 0 0 p e r y e a r f o r 20 y e a r s o f fu tu r e c r e d it e d s e r v i c e
b y m e th o d o f fin a n c in g __________________________________________________________
D is a b ility r e t ir e m e n t b e n e fit s , f o r w o r k e r s in e lig ib le f o r
s o c i a l s e c u r it y d is a b ilit y b e n e fit , 50 y e a r s o f a g e e a r n in g
$ 4 ,8 0 0 p e r y e a r f o r 20 y e a r s o f fu tu re c r e d it e d s e r v i c e
by m e th o d o f fin a n c in g _________________________________________________________
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C h a r ts :
1.
2.
A v e r a g e m o n th ly n o r m a l r e t ir e m e n t b e n e fit s f o r
annual e a rn in g s and y e a r s o f fu tu re s e r v i c e , f a ll
M on th ly n o r m a l r e t ir e m e n t b e n e fit s f o r a w o r k e r
$ 4 ,0 0 0 a y e a r w ith 30 y e a r s o f fu tu r e s e r v i c e ,
A p p e n d ix
s e le c t e d
1959 __________________
e a rn in g
1952 and 1959 ________
14
15
ta b le :
P r o v i s i o n s f o r n o r m a l, e a r l y , and d is a b ilit y r e t ir e m e n t in
s e le c t e d p e n s io n p la n s u n d e r c o l l e c t i v e b a r g a in in g
by
in d u s tr y g ro u p and m e th o d o f fin a n c in g ____________________________________
Vll
54
Pension Plans Under Collective Bargaining
Normal Retirement
T h e n o r m a l r e t ir e m e n t p r o v i s io n fou n d in v ir t u a lly e v e r y p r iv a t e p e n s io n
p la n s p e c i f i e s the a g e a t w h ich , in the d e s ig n o f the p la n , a w o r k e r w o u ld b e e x
p e c t e d to r e t i r e and the f o r m u la to b e u s e d in the c o m p u ta tio n o f the r e t ir e m e n t
in c o m e f o r a q u a lifie d w o r k e r . T h e n o r m a l r e t ir e m e n t a g e , a s u s e d in th is stu dy,
m a y b e d e fin e d a s the e a r l i e s t a g e a t w h ich a w o r k e r , h a v in g o th e r w is e q u a lifie d
f o r b e n e fit s , m a y r e t i r e o f h is ow n a c c o r d (i. e. , w ith o u t h is e m p l o y e r ’ s c o n s e n t
o r c o m p u ls io n ) and r e c e i v e im m e d ia t e ly th e fu ll a m o u n t o f b e n e fit s to w h ic h h e is
e n title d u n d er the n o r m a l b e n e fit f o r m u la o f the p la n . In m o s t p la n s , th is a g e is
65 y e a r s . In a d d itio n to a tta in in g th is a g e , a w o r k e r m u s t f u l f i l l s e r v i c e r e q u i r e
m e n ts to q u a lify f o r n o r m a l r e t ir e m e n t b e n e fit s u n d e r m o s t p la n s .
A n im p o r ta n t c h a r a c t e r i s t i c o f the n o r m a l r e t ir e m e n t p r o v i s io n is its
in flu e n c e on o th e r p la n p r o v i s io n s , s in c e it o fte n s e r v e s a s a s ta n d a rd to w h ic h
o th e r p r o v i s io n s a r e tie d . In clu d e d in th e s e o th e r p r o v i s io n s a r e v e s t in g , e a r ly
and d is a b ilit y r e t ir e m e n t , and c o m p u l s o r y o r a u t o m a tic r e t ir e m e n t (u n d e r s o m e
p la n s , w o r k e r s m a y b e c o m p e lle d to r e t i r e a t the a g e w h ich is a ls o d e s ig n a te d a s
the n o r m a l r e t ir e m e n t a g e ). 1
Th e b a s i c f a c t o r s in n o r m a l b e n e fit f o r m u la s a r e s e r v i c e (le n g th o f e m
p lo y m e n t) and e a r n in g s , o r s e r v i c e a lo n e . A n o th e r im p o r ta n t a s p e c t is the e x
p l i c i t o r i m p l ic it r e la t io n s h ip b e tw e e n p la n b e n e fit s and s o c i a l s e c u r i t y b e n e fit s .
Th e v a r io u s v a lu e s a s s ig n e d th e s e e le m e n ts le a d to w id e d iv e r s it y in th e b e n e
f it s p r o m i s e d b y p r iv a t e p e n s io n p la n s . T h e u s e o f an e a r n in g s f a c t o r c o m b in e d
w ith len g th o f e m p lo y m e n t m a in ta in s , to s o m e d e g r e e at le a s t , d if fe r e n t ia ls in
r e t ir e m e n t in c o m e c o m m e n s u r a t e w ith d if fe r e n t ia ls in p r e r e t ir e m e n t e a r n in g s ,
w h e r e a s b e n e fit s b a s e d on c o n s id e r a t io n o f s e r v i c e a lo n e p la c e a ll w o r k e r s on a
c o m m o n g rou n d , r e g a r d l e s s o f th e ir p r e r e t ir e m e n t e a r n in g s d if f e r e n c e s .
G e a r in g
b e n e fit s s o le l y to len g th o f e m p lo y m e n t h a s b e c o m e m o r e c o m m o n in c o l l e c t i v e l y
b a r g a in e d p la n s in r e c e n t y e a r s .
Th e e x p e c t a tio n that w o r k e r s w ill b e e l ig i b l e f o r s o c i a l s e c u r it y b e n e fit s
a t a g e 65 is ta k en in to a c c o u n t in p e n s io n p la n n in g , b o th in s e ttin g the n o r m a l
r e t ir e m e n t a g e and in the b e n e fit f o r m u l a s . S o c ia l s e c u r i t y b e n e fit s a r e e x p l i c
itly taken in to a c c o u n t in s o m e p r iv a t e p la n s , e ith e r th ro u g h the r e d u c t io n o f c o m
p u ted p la n b e n e fit s b y a ll o r p a r t o f the a m o u n t o f the w o r k e r ’ s s o c i a l s e c u r it y
p a y m e n t (i. e. , b y in te g r a tin g p r iv a t e and p u b lic b e n e fit s to y ie ld a s p e c i f i c in
c o m e l e v e l) o r b y the u s e o f d if fe r e n t b e n e fit f o r m u la s f o r w o r k e r s w ith e a r n in g s
b e lo w and a b o v e the ta x a b le lim it s u n d e r the S o c ia l S e c u r it y A c t.
W ith ou t a ny
d i r e c t t i e - i n to s o c i a l s e c u r it y , b e n e fit l e v e l s in a ll o th e r p r iv a t e p la n s r e f l e c t
the e x p e c t a tio n th at s o c i a l s e c u r it y p a y m e n ts w ill b e fo r t h c o m in g .
A s th is stu d y
o f p la n s in e f f e c t in the f a l l o f 1959 s h o w s, th e g r e a t e r p a r t o f the r e t ir e m e n t
in c o m e to b e e x p e c t e d b y m o s t w o r k e r s c o v e r e d b y p e n s io n p la n s u n d e r c o l l e c t i v e
b a r g a in in g w h en th ey r e a c h 65 w ill b e p r o v id e d b y s o c i a l s e c u r i t y .
1 See P e n s io n P la n s U nder C o lle c t iv e B a r g a in in g , L a te 1 95 8: P a r t I.
V e s tin g P r o v i s i o n s and R e q u ir e m e n ts f o r E a r ly R e t ir e m e n t ; P a r t II.
In v o lu n ta r y
R e t ir e m e n t P r o v i s i o n s , B L S B u ll. 1259 (1 9 5 9 ).
2
S c o p e o f Study
F o r th is stu d y , 300 s e le c t e d p e n s io n p la n s u n d e r c o l l e c t i v e b a r g a in in g ,
in e f f e c t in the f a l l o f 1959, w e r e a n a ly z e d . 2 E a c h p la n c o v e r e d 1, 000 o r
m ore w orkers.
C o n s id e r a t io n s in the s e le c t io n o f th e s e p la n s f o r stu d y w e r e
the u n ion in v o lv e d , ty p e o f e m p lo y e r b a r g a in in g u n it, in d u s tr y , ty p e o f p la n ,
and g e o g r a p h ic a l lo c a t io n . T h e s e le c t e d p la n s r a n g e d in c o v e r a g e f r o m 1, 000 to
300, 000 w o r k e r s — to ta lin g a p p r o x im a t e ly 4. 7 m i ll io n w o r k e r s u n d e r c o l l e c t i v e
b a r g a in in g a g r e e m e n t s o r a b o u t h a lf o f th e e s t im a t e d c o v e r a g e o f a ll p e n s io n
p la n s u n d er c o l l e c t i v e b a r g a in in g in the U n ited S ta te s (ta b le 1).
A l l m a jo r in d u s t r ie s (e x c lu d in g r a i lr o a d s and a ir li n e s ) w e r e r e p r e s e n t e d
in the s e le c t io n (ta b le 2).
A b o u t 3 ou t o f 4 p la n s (2 2 9 ) w e r e in m a n u fa c tu r in g
in d u s t r ie s and c o v e r e d 3 .2 m i ll io n w o r k e r s ; 71 w e r e in n o n m a n u fa c tu rin g in d u s t r ie s
and a p p lie d to a p p r o x im a t e ly 1.5 m i ll io n w o r k e r s . S ix ty -n in e p la n s , c o v e r i n g m o r e
than a th ir d o f th e w o r k e r s in th e stu dy, w e r e e s t a b lis h e d on a m u lt ie m p lo y e r
b a s is .
F o r t y - n in e p la n s w e r e fin a n c e d b y b o th the e m p lo y e r and the w o r k e r
( c o n t r ib u t o r y p la n s ); th e r e m a in in g 251 p la n s w e r e fin a n c e d e n t ir e ly b y th e e m
p lo y e r (n o n c o n t r ib u t o r y p la n s ), 3 and c o v e r e d a lm o s t 85 p e r c e n t o f a ll w o r k e r s .
T h e n o r m a l r e t ir e m e n t p r o v i s i o n s fo u n d in th e s e le c t e d p e n s io n p la n s
w e r e a n a ly z e d in d e t a il, in c lu d in g m in im u m a g e and s e r v i c e r e q u ir e m e n t s and
o th e r e le m e n t s o f th e b e n e fit f o r m u l a s .
In a d d itio n , the b e n e f it a m o u n ts p r o
v id e d b y the p la n s u n d e r c e r t a in a s s u m e d c o n d it io n s w e r e co m p u te d f o r i l l u s
t r a t iv e p u r p o s e s . T h e e f f e c t s o f p r e p a r t ic ip a t io n r e q u ir e m e n t s on n o r m a l b e n e fit
p r o v i s i o n s w e r e a ls o e x a m in e d .
A p r e v io u s B u r e a u stu dy o f 300 p e n s io n p la n s in e f f e c t in la te 1952 p r o
v id e d a b a s i s f o r a lim it e d e v a lu a tio n o f m a jo r tr e n d s o v e r the p a s t 7 y e a r s . 4
O f th e s e p la n s , 219 w e r e in c lu d e d in the p r e s e n t stu d y .
T h e s u b s titu tio n o f
81 p la n s w a s o c c a s i o n e d b y ( 1) th e e lim in a tio n o f p la n s c o v e r i n g f e w e r than
1, 000 w o r k e r s ;5 ( 2) m e r g e r s , c o m p a n ie s g o in g ou t o f b u s in e s s , o r p la n s t e r m i
n a ted ; o r (3) in a fe w c a s e s , th e l a c k o f c u r r e n t in fo r m a t io n .
R e q u ir e m e n t s f o r P a r t ic ip a t io n
T o p a r t ic ip a t e in o r to b e c o v e r e d b y a p e n s io n p la n , the w o r k e r m u s t
m e e t c e r t a in c o n d it io n s .
M an y n o n c o n t r ib u t o r y p la n s m e r e l y r e q u ir e th at the
w o r k e r b e a r e g u la r f u l l - t i m e e m p lo y e e on th e p a y r o ll . P r o v i s i o n s s u ch a s t h i s ,
w h ic h m a k e p a r t ic ip a t io n m o r e o r l e s s a u t o m a tic , a r e d e s ig n e d to e x c lu d e f r o m
2 T h e s e p la n s in c lu d e d th o s e e s t a b lis h e d f o r the f i r s t t im e a s the r e s u l t
o f c o l l e c t i v e b a r g a in in g and p la n s e s t a b lis h e d o r i g i n a l ly b y the e m p lo y e r o r th e
u n ion b u t s in c e b r o u g h t w ith in the s c o p e o f th e c o l l e c t i v e b a r g a in in g a g r e e m e n t —
a t le a s t to the e x te n t th at the a g r e e m e n t e s t a b lis h e d e m p lo y e r r e s p o n s i b i li t y to
co n tin u e o r p r o v id e c e r t a in b e n e f it s .
M an y p la n s w e r e e x te n d e d u n ifo r m ly to c o v e r w o r k e r s o u ts id e the s c o p e
o f th e c o l l e c t i v e b a r g a in in g a g r e e m e n t . H o w e v e r , th e p e n s io n p la n c o v e r a g e u s e d
in th is stu dy r e p r e s e n t s o n ly th e n u m b e r o f w o r k e r s u n d e r c o l l e c t i v e b a r g a i n
in g a g r e e m e n t s .
T h e s a m e s e le c t io n o f p la n s w a s u s e d in B L S B u ll. 1259 p r e v i o u s l y c it e d .
A s u b s e q u e n t stu d y w i ll c o v e r d ea th b e n e fit s and s u r v iv o r o p tio n s .
3 S o m e o f t h e s e p la n s g a v e th e w o r k e r an o p tio n to c o n tr ib u te to a s u p p le
m e n t a r y p la n to b u ild up a d d itio n a l p e n s io n b e n e f it s .
In th e s e c a s e s , o n ly the
b a s i c n o n c o n t r ib u t o r y p la n w a s a n a ly z e d .
4 P e n s io n P la n s U n d er C o lle c t iv e B a r g a in in g , B L S B u ll. 1147 (1 9 5 3 ).
5 T h e 1952 stu d y in c lu d e d 21 p la n s w ith f e w e r than 1, 000 w o r k e r s .
3
p la n c o v e r a g e o n ly s e a s o n a l and p a r t - t im e w o r k e r s and w o r k e r s w h o h a v e n o t
p a s s e d th ro u g h a p r o b a t io n a r y p e r io d .
U n d er jo in t ly fin a n c e d o r c o n t r ib u t o r y
p la n s , the w o r k e r u s u a lly h a s a c h o i c e a s to w h e th e r o r n o t h e w i ll p a r t ic ip a t e
b y m a k in g the n e c e s s a r y c o n tr ib u tio n s (i. e. , p a r t ic ip a t io n is v o lu n ta r y ); in s o m e
c a s e s , h o w e v e r , p a r t ic ip a t io n is c o m p u ls o r y , that i s , a c o n d it io n o f e m p lo y m e n t.
S om e p la n s , b o th c o n t r ib u t o r y and n o n c o n t r ib u t o r y , a ls o h a v e p r e p a r t i c i
p a tio n r e q u ir e m e n t s w h ich w ith h o ld p e n s io n c o v e r a g e f r o m a n e w ly h ir e d w o r k e r
u n til h e h a s m e t c e r t a in a g e o r e m p lo y m e n t r e q u ir e m e n t s o r b o th . T h e s e p r o
v i s i o n s m a y a f f e c t e lig ib ilit y f o r p la n b e n e fit s and the a m o u n t o f b e n e f it s , h e n c e
th e y a r e im p o r ta n t e le m e n ts o f p e n s io n p la n s .
O f the 300 p la n s stu d ied , 65 p la n s c o v e r i n g a lm o s t 600, 000 w o r k e r s had
p r e p a r t ic ip a t io n r e q u ir e m e n t s w h ich , r e g a r d l e s s o f the w o r k e r * s a g e , w ith h e ld
p e n s io n p la n c o v e r a g e f o r p e r i o d s o f 1 to 5 y e a r s a ft e r h ir in g (ta b le 3).
(In
the 1952 stu dy, 77 p la n s c o n ta in e d s im i la r r e s t r i c t i o n s . 6 )
M in im u m a g e r e
q u ir e m e n t s ra n g in g f r o m 25 to 35 y e a r s w e r e a ls o s tip u la te d in 25 o f th e s e
65 p la n s .
A n o th e r s e v e n p la n s had m in im u m a g e b u t n o s e r v i c e r e q u ir e m e n t s .
In s o m e p la n s , le n g th o f p la n m e m b e r s h ip — i. e. , s e r v i c e a ft e r f i r s t
b e in g c o v e r e d b y the p la n — r a th e r than le n g th o f to ta l e m p lo y m e n t w a s u s e d in
d e te r m in in g e l ig i b i l it y f o r b e n e fit s and in c o m p u tin g b e n e fit s . T h e r e f o r e , to put
a ll p la n s on the s a m e fo o tin g , p r e p a r t ic ip a t io n p r o v i s io n s m u s t b e c o n s i d e r e d in
c o n ju n c tio n w ith s e r v i c e r e q u ir e m e n t s f o r b e n e f it s .
O f the 72 p la n s w ith p r e
p a r t ic ip a t io n r e q u ir e m e n t s , o n ly 8 p la n s co u n te d s e r v i c e b e f o r e p la n c o v e r a g e
in d e te r m in in g e l ig i b i l it y f o r n o r m a l r e t ir e m e n t ; in the r e m a in in g 64 p la n s , o n ly
s e r v i c e d u rin g p la n m e m b e r s h ip w a s co u n te d (ta b le 4). O f the 7 2 p la n s , m o r e
o v e r , 59 p la n s d id n ot co u n t e m p lo y m e n t p r i o r to d ate o f p la n m e m b e r s h ip in
co m p u tin g b a s i c n o r m a l r e t ir e m e n t b e n e fit s (ta b le 5). T h is e x c lu s io n w a s to b e
e x p e c t e d in the 35 c o n t r ib u t o r y p la n s in w h ich b e n e fit s a r e t y p ic a lly d i r e c t l y r e
la te d to e m p lo y e e c o n tr ib u tio n s .
R e q u ir e m e n ts f o r N o r m a l R e t ir e m e n t B e n e fit s
V ir tu a lly e v e r y p e n s io n p la n r e q u ir e s that the w o r k e r a tta in a s p e c if ie d
a g e , u s u a lly 65 y e a r s , to b e e lig ib le f o r n o r m a l r e t ir e m e n t b e n e f it s . In a d d itio n ,
m a n y p la n s a ls o r e q u ir e the f u lfillm e n t o f a c e r t a in n u m b e r o f y e a r s o f c r e d it e d
s e r v i c e 7 w ith the e m p lo y e r o r g r o u p o f e m p lo y e r s .
A lth o u g h a g e and s e r v i c e
r e q u ir e m e n t s a r e t y p ic a lly the k e y e le m e n ts in d e te r m in in g e l ig i b i l it y f o r o th e r
ty p e s o f b e n e fit s fou n d in p e n s io n p la n s (e . g. , e a r ly and d is a b ilit y r e t ir e m e n t
and v e s t in g o f p e n s io n r ig h t s ), u n d e r n o o th e r p r o v i s i o n i s the a tta in m e n t o f a
c e r t a in a g e g iv e n s o m u c h w e ig h t.
T h e n o r m a l r e t ir e m e n t a g e f i x e s the e a r l i e s t
a g e a t w h ich the w o r k e r m a y r e t i r e at h is ow n v o l it io n w ith im m e d ia te fu ll
b e n e f it s .
It m a y a ls o s e r v e a s the a g e o f c o m p u l s o r y o r a u to m a tic r e t i r e
m e n t and the a g e a t w h ich b e n e fit s o f a d e f e r r e d n a tu re b e c o m e p a y a b le o r
a r e to b e r e c o m p u t e d . 8
6 In b o th s tu d ie s , p la n s w ith s e r v i c e r e q u ir e m e n t s f o r p la n p a r t ic ip a t io n
o f l e s s than 1 y e a r w e r e e x c lu d e d f r o m th is g r o u p .
7 A s u s e d in th is b u lle tin , the t e r m n s e r v i c e ” a p p lie s to e m p lo y m e n t o r
s e r v i c e c r e d it e d to w a r d q u a lific a t io n o r f o r c o m p u tin g b e n e f it s u n d e r p la n p r o
v i s io n s , r e g a r d l e s s o f the d e fin itio n o f s e r v i c e in the p la n .
In the p la n d o c u
m e n ts , it m a y b e r e f e r r e d to a s ’ ’ co n tin u o u s s e r v i c e , ” " c r e d i t e d s e r v i c e , " " c o n
s e c u t iv e y e a r s o f s e r v i c e , " e tc .
8 S ee B L S B u ll. 1259, p p . 1 0 -1 1 .
4
T h e m in im u m a g e and s e r v i c e r e q u ir e m e n t s f o r n o r m a l r e t ir e m e n t b e n e
fit s a r e sh ow n in ta b le 6 a s th ey w e r e e x p r e s s e d in the p la n s , i. e. , w ith o u t a d
ju s tm e n t f o r the p r e p a r t ic ip a t io n s e r v i c e r e q u ir e m e n t s in the 64 p la n s w h ich
co u n te d p la n m e m b e r s h ip on ly . O n ly s ix o f the c o n t r ib u t o r y p la n s s p e c if ie d s e r v
i c e r e q u ir e m e n t s , w h ile v ir t u a lly a ll n o n c o n t r ib u t o r y p la n s d id s o .
The c o n
c e n tr a t io n o f p la n s and w o r k e r s c o v e r e d in tw o c a t e g o r i e s — a g e 65 and 10 y e a r s
o f s e r v i c e and a g e 65 and 15 y e a r s o f s e r v i c e — r e f l e c t s the in flu e n c e o f p la n s in
the a u t o m o b ile and s t e e l in d u s t r ie s , r e s p e c t i v e l y .
A ft e r a d ju s tm e n t to a c c o u n t f o r the 64 p la n s w h ich c r e d it e d p la n m e m b e r
sh ip s e r v i c e o n ly (i. e. , a ft e r the a d d itio n o f p r e p a r t ic ip a t io n s e r v i c e to p la n
m e m b e r s h ip s e r v i c e ) the to ta l e m p lo y m e n t r e q u ir e m e n t s f o r n o r m a l r e t ir e m e n t
r a n g e d f r o m n on e to 35 y e a r s (ta b le 7). A p p r o x im a t e ly 55 p e r c e n t o f the p la n s
c o v e r i n g h a lf the w o r k e r s , s p e c if ie d e ith e r 10 o r 15 y e a r s o f c r e d it e d s e r v i c e ,
w h ile a b o u t 25 p e r c e n t o f the p la n s s p e c if ie d l e s s than 10 y e a r s (in c lu d in g 18 p la n s
w ith n o s e r v i c e r e q u ir e m e n t ). 9 On th e o th e r hand, 16 p e r c e n t o f the p la n s
c o v e r i n g n e a r ly 30 p e r c e n t o f the w o r k e r s r e q u ir e d a t le a s t 20 y e a r s o f c r e d it e d
s e r v i c e f o r n o r m a l r e t ir e m e n t b e n e fit s .
M in im u m a g e r e q u ir e m e n t s f o r n o r m a l r e t ir e m e n t w e r e fou n d in a ll but
on e o f the p la n s s tu d ie d . S om e p la n s had a lt e r n a t iv e n o r m a l r e t ir e m e n t a g e s d e
p e n d in g on the a m o u n t o f c r e d it e d s e r v i c e . F o r e x a m p le , on e p la n d e s c r i b e s its
f le x i b le n o r m a l r e t ir e m e n t a g e a s f o ll o w s :
An
e m p lo y e e . . . w h o h a s a tta in e d the a g e o f
o r m o r e o f c o m p a n y s e r v i c e c r e d it . . .
a tta in ed a g e 60 o r o v e r and h a s 30 o r m o r e y e a r s
s e r v i c e c r e d i t is e lig ib le f o r a p e n s io n b e n e fit . . .
10 y e a r s
65 and h a s
o r w h o h as
o f com pan y
.
Th e im p a c t o f the S o c ia l S e c u r it y A c t and the in t e r r e la t io n o f p u b lic and
p r iv a t e p e n s io n p la n s is r e f l e c t e d in the f a c t th at a g e 65 (th e a g e at w h ich m a le
w o r k e r s q u a lify f o r o ld a g e b e n e fit s u n d er the a ct) w a s the n o r m a l r e t ir e m e n t
a g e in m o r e than 9 out o f 10 p la n s . A ll but 2 o f the r e m a in in g 20 p la n s had a
n o r m a l r e t ir e m e n t a g e b e lo w 65— u s u a lly 60.
T h e B u r e a u 1s 1952 stu d y sh o w e d
a s im ila r d is t r ib u t io n o f n o r m a l r e t ir e m e n t a g e s .
w om en.
O f the 300 p la n s stu d ied ,
T h e a g e s s p e c if ie d a r e
21 p r o v id e d
a lo w e r n o r m a l r e t ir e m e n t a g e f o r
sh ow n b e lo w :
N o r m a l r e t ir e m e n t a g e
A ll p la n s w ith e a r l i e r n o r m a l
r e t ir e m e n t a g e f o r w o m e n ____
M en
65
65
65
60
P la n s
W ork er s
(th o u s a n d s )
21
264. 5
W om en
62
60
55
55
3
11
3
4
21. 7
76. 7
12. 9
153. 2
9
T h e a b s e n c e o f a s e r v i c e r e q u ir e m e n t o r a lo w s e r v i c e r e q u ir e m e n t
u s u a lly m e a n s a s m a ll r e t ir e m e n t b e n e fit i f the w o r k e r f a i ls to b u ild up s u ffic ie n t
s e r v i c e , u n le s s the p la n p r o v i d e s a s u b s ta n tia l m in im u m b e n e fit r e g a r d l e s s o f
le n g th o f s e r v i c e ; fe w o f the p la n s stu d ie d c o n ta in e d s u ch m in im u m p r o v i s i o n s .
5
N o r m a l R e t ir e m e n t B e n e fit F o r m u la s
Th e a m ou n t o f r e t ir e m e n t in c o m e a q u a lifie d w o r k e r is e n title d to at
n o r m a l r e t ir e m e n t a g e is d e t e r m in e d b y the n o r m a l b e n e fit f o r m u la o f the p la n .
T h e s e f o r m u l a s , w h ich v a r y w id e ly a m o n g p la n s , u s u a lly ta k e in to a c c o u n t the
a m ou n t o f c r e d it e d s e r v i c e , o r s e r v i c e and e a r n in g s . A d is t in c t io n m a y a ls o b e
m a d e in the tr e a tm e n t o f b e n e fit s f o r e m p lo y m e n t b e f o r e the e f fe c t iv e d ate o f the
p la n ( np a s t s e r v i c e " ) and b e n e fit s f o r s e r v i c e s in c e that d a te (" fu t u r e s e r v i c e " ) .
In a d d itio n , s o c i a l s e c u r it y b e n e fit s p a y a b le to the w o r k e r m a y a f f e c t the a m ou n t
p a id b y the p r iv a t e p la n . T h e n o r m a l b e n e fit fo r m u la is a ls o im p o r ta n t to w o r k
e r s q u a lify in g f o r e a r ly and d is a b ilit y r e t ir e m e n t and f o r v e s t in g , s in c e b e n e fit s
u n d er th e s e p r o v i s io n s a r e u s u a lly d e r iv e d f r o m the n o r m a l r e t ir e m e n t f o r m u la
o r a m o d if ic a t io n o f it.
P a s t S e r v ic e B e n e fit F o r m u la s . — A lm o s t e v e r y p la n stu d ie d c r e d it e d the
s e r v i c e r e n d e r e d p r i o r to the e f fe c t iv e d ate o f the p la n , " p a s t s e r v i c e . "
H ow
e v e r , the e v a lu a tio n o f p a s t s e r v i c e w a s o fte n b a s e d on d iffe r e n t f a c t o r s o r
f o r m u la s than "fu tu r e s e r v i c e . "
S om e p la n s a ls o p r o v id e d a d if fe r e n t f o r m u la
f o r " fu tu r e s e r v i c e " r e n d e r e d b e f o r e the e f fe c t iv e d ate o f an a m e n d m e n t to the
p la n bu t a ft e r the e f fe c t iv e d ate o f the p la n , i. e. , " in t e r m e d ia t e s e r v i c e . "
B oth
p a s t s e r v i c e and in t e r m e d ia te s e r v i c e fo r m u la s u s u a lly y ie ld s m a lle r b e n e fit s
than fu tu r e s e r v i c e fo r m u la s f o r the s a m e a m o u n t o f s e r v i c e and e a r n in g s .
S in ce p e n s io n p la n s a r e r e l a t iv e ly n ew , p a r t ic u la r l y th o s e u n d e r c o l
l e c t i v e b a r g a in in g , p r o b a b ly m o s t o f the w o r k e r s r e t ir in g w ith in the n e x t fe w
y e a r s w ill r e c e i v e b e n e fit s d e t e r m in e d in la r g e p a r t b y the a p p lic a t io n o f p a s t
and in t e r m e d ia t e s e r v i c e f o r m u la s . H o w e v e r , th e s e fo r m u la s v a r y w id e ly a m o n g
p la n s , d if fe r in g in the l ib e r a li t y o f a llo w a n c e f o r p a s t s e r v i c e c r e d it s a s w e ll
a s in the k e y d a te s w h ich the f o r m u la s ta k e in to a c c o u n t (d a te o f p la n e s t a b
lis h m e n t, a m e n d m e n ts , e tc . ).
B e c a u s e p a s t and in t e r m e d ia t e s e r v i c e fo r m u la s ,
in g e n e r a l, a r e e s s e n t ia lly in t e r im d e v ic e s , and b e c a u s e fu tu r e s e r v i c e f o r m u la s
ten d to b e c o m e the im p o r ta n t e le m e n t in c o l l e c t i v e b a r g a in in g , the r e s t o f th is
stu dy d e a ls w ith fu tu r e s e r v i c e fo r m u la s and the b e n e fit s to b e d e r iv e d f r o m
th e s e f o r m u la s .
B a s ic B e n e fit F o r m u la s . — A ll o f the 300 p la n s stu d ie d p r o v id e d a b a s ic
b e n e fit f o r m u la f o r c o m p u tin g the r e t ir e m e n t b e n e fit s p a y a b le to q u a lifie d w o r k e r s
(ta b le 8 ).
F o r e x a m p le , on e p la n sta te d that:
The m o n th ly a m ou n t o f any p e n s io n . . . s h a ll e q u a l 1 p e r c e n t o f
the a v e r a g e m o n th ly c o m p e n s a t io n r e c e i v e d b y the a p p lica n t f r o m
the c o m p a n y f o r s e r v i c e s
r e n d e r e d d u r in g the 120 c a le n d a r
m on th s n ex t p r e c e d in g the m on th in w h ich the a p p lica n t s h a ll
r e t i r e , m u ltip lie d b y the n u m b e r o f y e a r s o f h is co n tin u o u s s e r v
i c e . . . / s u b j e c t to a d e d u c tio n o f $ 8 5 f o r p r im a r y s o c i a l s e
c u r it y b e n e f i t s / .
In a d d itio n , 112 p la n s , c o v e r in g 30 p e r c e n t o f th e w o r k e r s , h ad a m in im u m
b e n e fit o r a lte r n a tiv e b e n e fit f o r m u la , e s ta b lis h in g a l e v e l b e lo w w h ich b e n e fit s f o r
the q u a lifie d w o r k e r c o u ld n ot f a ll, r e g a r d l e s s o f the a m o u n t c o m p u te d u n d er the
b a s i c fo r m u la .
F o r e x a m p le , the p la n q u o te d a b o v e a ls o p r o v id e d that:
T h e m in im u m m o n th ly p e n s io n f o r an e m p lo y e e w h o s h a ll r e
t i r e a t o r a ft e r a g e 65 and b e c o m e e n title d to a p e n s io n . . .
s h a ll b e b a s e d on the e m p lo y e e 1s co n tin u o u s s e r v i c e im m e d ia t e ly
p r e c e d in g r e t ir e m e n t , up to a m a x im u m o f 30 y e a r s , c a l c u
la te d a s f o ll o w s :
(1) $ 2 .5 0 m u lt ip lie d b y s u ch y e a r s o f c o n
tin u ou s s e r v i c e b e g in n in g on o r a ft e r N o v e m b e r 1, 1957; and
(2) $ 2 . 40 m u ltip lie d b y s u ch y e a r s o f co n tin u o u s s e r v i c e p r i o r
to N o v e m b e r 1, 1957.
6
T h e p e r i o d o f s e r v i c e to q u a lify f o r th e m in im u m b e n e fit w a s th e s a m e
a s f o r the b a s i c b e n e fit in a b o u t t w o - t h ir d s o f th e p la n s and w a s h ig h e r in th e
o th e r p la n s .
T h e m a n y b a s i c b e n e fit f o r m u la s fou n d in the p la n s s tu d ie d e m p h a s iz e the
v a r i e t y and c o m p le x it y o f p e n s io n p la n s . H o w e v e r , th e v a s t m a jo r i t y o f f o r m u l a s
m a y b e c l a s s i f i e d in to th r e e m a jo r ty p e s a c c o r d in g to th e v a r i a b le s e m p lo y e d :
(1) T h e b e n e fit v a r i e s b y e a r n in g s and c r e d it e d s e r v i c e ; (2 ) th e b e n e f it v a r i e s b y
c r e d it e d s e r v i c e a lo n e ; and (3 ) a u n ifo r m o r fla t b e n e fit is p r o v id e d f o r a ll w o r k
e r s w h o f u l f i l l s p e c if ie d r e q u ir e m e n t s . E x a m p le s o f e a c h ty p e f o ll o w :
(1)
T h e m o n th ly p e n s io n b e n e fit f o r an e m p lo y e e w h o q u a lifie s
t h e r e f o r s h a ll b e co m p u te d b y ta k in g 1. 1 p e r c e n t o f the e m
p l o y e e 's a v e r a g e s t r a ig h t -t im e m o n th ly e a r n in g s d u r in g the
120 c a le n d a r m o n th s n e x t p r e c e d in g h is r e t ir e m e n t , m u lt i
p lie d b y h is c o m p a n y s e r v i c e c r e d it .
(2)
T h e m o n th ly a m ou n t o f p e n s io n p a y a b le to an e m p lo y e e . .
s h a ll b e $ 1 .5 0 a m o n th f o r e a c h o f h is y e a r s o f c r e d it e d
s e r v i c e , to a m a x im u m o f 30 y e a r s .
(3)
T h e a m o u n t o f p e n s io n p a id b y th e fu n d to e l ig i b l e m e m
b e r s is $ 3 0 a m o n th f o r l i f e .
F o r m u la s in w h ic h the b e n e fit v a r i e s b y e a r n in g s and c r e d it e d s e r v i c e
w e r e fou n d in 139 o f th e 300 p la n s , and 118 p la n s h ad f o r m u l a s v a r y in g b e n e fit s
b y le n g th o f s e r v i c e a lo n e (ta b le 9 ). T h e th ir d ty p e o f fo r m u la , w h ich p r o v id e d
a u n ifo r m o r f la t b e n e fit f o r a ll q u a lifie d w o r k e r s , w a s fo u n d in 31 p la n s . C o m
b in a t io n s and v a r ia t io n s o f the a b o v e f o r m u la s a c c o u n t e d f o r the r e m a in in g
12 p la n s . In c o m p a r i s o n w ith the B u r e a u 's 1952 stu dy, it a p p e a r s th at the p r o
p o r t io n o f p la n s in w h ich b e n e f it s w e r e a ff e c t e d s o l e l y b y le n g th o f s e r v i c e h a s i n
c r e a s e d a t the e x p e n s e o f th o s e a ls o ta k in g e a r n in g s in to a c c o u n t . M o r e o v e r , in
c r e a s e s in m in im u m b e n e fit s b a s e d o n s e r v i c e in the la t t e r ty p e o f p la n , o r the
in t r o d u c t io n o f m in im u m b e n e f it s , m a y l e s s e n the s ig n if ic a n c e o f e a r n in g s - b a s e d
b e n e f it s ( s e e p a g e 13).
A d ju s tm e n t o f P r iv a t e P la n B e n e fit s to S o c ia l S e c u r it y B e n e fit s
F e d e r a l o l d - a g e , s u r v i v o r s and d is a b ilit y in s u r a n c e b e n e fit s p r o v id e d
u n d er title II o f th e S o c ia l S e c u r it y A c t a r e d i r e c t l y in c o r p o r a t e d in to n o r m a l r e
t ir e m e n t f o r m u la s in tw o w a y s . 10 F i r s t , th e p la n m a y p r o v id e th at a ll o r p a r t
o f the s o c i a l s e c u r i t y b e n e f it s p a y a b le to th e w o r k e r s h a ll b e d e d u c te d f r o m the
10
S o m e p la n s in th is stu dy in c lu d e p r o v i s io n s f o r r e d u c in g p r iv a t e p la p
b e n e fit s b y a ll o r p a r t o f the in c o m e f r o m o th e r s o u r c e s s u ch a s w o r k m e n 's c o m
p e n s a tio n p a y m e n t s , u n e m p lo y m e n t in s u r a n c e p a y m e n t s , s e v e r a n c e p a y m e n t s , p a y
m e n ts u n d e r o th e r p la n s fin a n c e d in w h o le o r in p a r t b y th e e m p lo y e r , e tc .
In
th is stu dy, h o w e v e r , the o n ly d e d u c tio n s c o n s i d e r e d a r e th o s e p a y a b le to the w o r k e r
u n d er the S o c ia l S e c u r it y A c t .
U nder c u r r e n t p r o v i s i o n s o f the S o c ia l S e c u r it y A c t , p r i m a r y in s u r a n c e
b e n e fit s a r e p a y a b le to q u a lifie d w o r k e r s a t a g e 65.
W o m e n m a y e l e c t to r e
c e i v e a p e r m a n e n t ly r e d u c e d p r i m a r y b e n e fit to b e g in b e tw e e n a g e s 62 and 65.
S in c e J u ly 1, 1957, q u a lifie d w o r k e r s h a v e b e e n e n title d to r e c e i v e a d is a b ilit y
b e n e f it f r o m a g e 50 to 65, i f th e y b e c o m e p e r m a n e n t ly d is a b le d , a s d e fin e d in
the a c t . W hen th e w o r k e r r e c e i v i n g s u ch a b e n e fit a tta in s a g e 65, th e d is a b ilit y
b e n e f it r e v e r t s to o l d - a g e b e n e fit .
7
a m o u n t c a lc u la t e d f r o m th e b e n e fit f o r m u la u n d e r th e p r iv a t e p la n .
T h is is c o m
m o n ly r e f e r r e d to a s th e " o f f s e t " a p p r o a c h . U s u a lly th is r e d u c t io n a p p lie s o n ly
to the s o c i a l s e c u r i t y b e n e fit due the w o r k e r h im s e l f , i. e. , the " p r i m a r y i n s u r
a n c e a m o u n t " due a s an o ld -a g e b e n e fit u n d e r s o c i a l s e c u r it y . S e c o n d , the b e n e
f i t f o r m u la m a y d e t e r m in e a d is p r o p o r t io n a t e ly l a r g e r b e n e fit r e l a t iv e to e a r n in g s
in e x c e s s o f a s p e c if ie d a m ou n t, w h ic h is a lm o s t a lw a y s e q u a l to the m a x im u m
e a r n in g s c o n s i d e r e d in co m p u tin g s o c i a l s e c u r i t y b e n e fit s a t the tim e the f o r m u la
w a s a d o p te d . 11
A s sh ow n in the fo llo w in g ta b u la tio n , a b o u t a fo u r th o f th e p la n s stu d ie d ,
c o v e r in g a fifth o f th e w o r k e r s , u s e d the o f f s e t a p p r o a c h .
T h is c o m p a r e s w ith
n e a r ly h a lf the p la n s in the B u r e a u s 1952 stu dy.
M o r e than h a lf o f the o f f s e t
p la n s in the c u r r e n t stu d y f o llo w e d the b a s i c s t e e l in d u s tr y p a tte r n b y d e d u c tin g
$ 8 5 a m on th — th e m a x im u m p r i m a r y s o c i a l s e c u r it y b e n e fit a t the tim e it w a s
i n c o r p o r a t e d in to the b a s i c f o r m u la o f the s t e e l plans© 12 M o s t o f the r e m a in in g
o f f s e t p la n s r e d u c e d b e n e fit s b y a ll o r o n e -h a lf o f the p r i m a r y s o c i a l s e c u r it y
b e n e f it to w h ich the p e n s io n e r i s e n title d .
P la n s
P r o v i s i o n f o r in t e g r a tio n w ith
s o c i a l s e c u r i t y b e n e fit s
T otal
_____________________________
N o in t e g r a tio n p r o v i s i o n _______
In te g r a te d p l a n s _________________
In te g ra te d b y o f f s e t m e t h o d ____
W ith d e d u c tio n o f—
A ll p r im a r y s o c ia l
s e c u r i t y ______________________
O n e -h a lf p r i m a r y s o c i a l
s e c u r i t y --------------------------------$85 fo r p r im a r y s o c ia l
s e c u r i t y ______________________
O th er d e d u c tio n s f o r
s o c i a l s e c u r i t y ______________
In te g ra te d b y p e r c e n t a g e
f a c t o r s _________________________
W ork ers
N um ber P e r c e n t
T h ou san ds P e r c e n t
300
100
4, 672. 7
100
180
1 120
1 79
60. 0
40. 0
26. 3
3 ,2 5 5 . 9
1 ,4 1 6 . 8
967. 6
69. 7
30. 3
20. 7
17
5. 7
54. 8
1. 2
13
4. 3
241. 0
5. 2
44
14. 7
644. 3
13. 8
5
1. 7
27. 5
0. 6
1 43
14. 3
4 58 . 0
9. 8
1
In c lu d e s 2 p la n s c o v e r i n g 8, 800 w o r k e r s u s in g b o th o f f s e t and
p e r c e n t a g e f a c t o r m e th o d s .
N O T E : B e c a u s e o f ro u n d in g , s u m s o f in d iv id u a l c o m p o n e n ts m a y
n ot e q u a l t o t a ls .
T h e b a s i c b e n e fit f o r m u la w a s in t e g r a te d w ith s o c i a l s e c u r i t y b e n e fit s
b y m e a n s o f the s e c o n d a p p r o a c h d e s c r i b e d a b o v e in a b o u t a se v e n th o f the p la n s
c o v e r in g a tenth o f the w o r k e r s .
11 M a x im u m e a r n in g s h a v e r i s e n f r o m $ 3 , 000 in 1935 to $ 3 , 600 in 1951,
$ 4 ,2 0 0 in 1955, to $ 4 ,8 0 0 in 1959; c f . S o c ia l S e c u r it y A c t , S e c . 2 1 5 (e )(1 ).
12 T h e p r i m a r y s o c i a l s e c u r it y d e d u c tio n in the b a s i c s t e e l p e n s io n p la n s
w a s r e d u c e d to $ 8 0 a ft e r th is stu d y w a s c o m p le t e d .
to
8
U n d er the d i r e c t o f f s e t m e th o d in w h ich h a lf o r a ll o f the p r i m a r y s o c i a l
s e c u r it y b e n e fit is d e d u c te d , a n y i n c r e a s e in s o c i a l s e c u r i t y b e n e fit s r e s u l t s in a
c o r r e s p o n d in g d e c r e a s e in the b e n e fit s to b e p a id b y the p r iv a t e p la n .
U n d er
p la n s in w h ich o n ly h a lf o f s o c i a l s e c u r it y b e n e fit s a r e o f fs e t , the w o r k e r w ill
b e n e fit b y o n e -h a lf the i n c r e a s e in s o c i a l s e c u r i t y b e n e fit l e v e l s .
H ow ever,
fix in g the s o c i a l s e c u r i t y d e d u c tio n on the b a s i s o f th o s e b e n e fit s in e f f e c t w h en
the p la n is n e g o tia te d o r a m e n d e d , a s in the s t e e l in d u s tr y p la n s , m e a n s th at a ll
fu tu r e i n c r e a s e s in s o c i a l s e c u r i t y b e n e fit s a r e p a s s e d a lo n g to the w o r k e r .
E a r n in g s and S e r v ic e F o r m u la s . — T y p ic a lly ,
m u la s r e a d a s f o ll o w s :
e a r n in g s and s e r v i c e f o r
P e n s io n = a p e r c e n t a g e f a c t o r ( o r f a c t o r s ) x e a r n in g s
and y e a r s o f s e r v i c e 13
T h r e e im p o r ta n t e le m e n ts a r e n e e d e d in the a p p lic a t io n o f th is ty p e o f b e n e fit
f o r m u la :
(1 ) T h e p e r c e n t a g e f a c t o r o r f a c t o r s to b e a p p lie d ; (2) the d e fin itio n
o f e a r n in g s ; and (3) the d e fin it io n o f s e r v i c e .
In a d d itio n to p a r t ic ip a t io n r e
q u ir e m e n t s and the c r e d it in g o f p r e p a r t ic ip a t io n s e r v i c e , w h ic h h a v e a lr e a d y b e e n
d is c u s s e d , the d e fin itio n o f s e r v i c e in v o lv e s the tr e a tm e n t o f p e r i o d s o f la y o ff,
d is a b ilit y , l e a v e s o f a b s e n c e , e t c .
T h e d e fin itio n o f e a r n in g s in v o lv e s b o th the
s c o p e o f e a r n in g s (e . g. , in c lu s io n o f o v e r t im e p a y and e x c lu s io n o f p e r i o d s o f
la y o ff, d is a b ilit y , e tc . ) and the tim e p e r i o d o v e r w h ich th e y e x te n d o r a r e a v e r
a g e d . A lm o s t h a lf o f the p la n s in w h ic h b e n e fit s v a r i e d w ith e a r n in g s and s e r v
i c e u s e d the e a r n in g s o f the la s t o r h ig h e s t 5 o r 10 y e a r s — u s u a lly the la s t
10 y e a r s — w h ile the r e m a in in g p la n s u s e d e a r n in g s in a ll y e a r s , i. e. , c a r e e r
e a r n in g s (ta b le 10).
U n d er the n o r m a l o r e x p e c t e d p a tte r n o f a d v a n c e m e n t in
in d u s tr y , the u s e o f h ig h e s t o r t e r m in a l e a r n in g s to co m p u te b e n e f it s , o th e r
f a c t o r s r e m a in in g e q u a l, h a s a d e fin ite a d v a n ta g e to the w o r k e r a t r e t ir e m e n t .
T h e p e r c e n t a g e f a c t o r , the o th e r e le m e n t in d e te r m in in g b e n e fit s u n d er
th is typ e o f fo r m u la , v a r i e d m a r k e d ly a m o n g p la n s , ra n g in g f r o m 0 .4 0 to 2 .5 0 p e r
c e n t (t a b le s 11 and 12).
A s sh ow n b e lo w , a b o u t t w o - t h ir d s o f the p la n s w h ich
u s e d c o m p e n s a t io n in the b e n e f it f o r m u la a p p lie d a s in g le u n ifo r m p e r c e n t a g e to
the e a r n in g s u s e d , w h e r e a s m o s t o f the r e m a in in g p la n s u s e d tw o p e r c e n t a g e s
a p p lic a b le a t d if fe r e n t e a r n in g s l e v e l s . U se o f the n o n u n ifo r m p e r c e n t a g e f a c t o r s
a s p r e v i o u s l y d is c u s s e d , is a m e th o d o f in t e g r a tin g p r iv a t e p la n b e n e fit s w ith
s o c i a l s e c u r it y .
N um ber of p e rce n ta g e
fa c t o r s u sed
Tnt^l
______
.
One f a c t o r (u n ifo r m ) ----------------------T w o f a c t o r s _______________________
O th er --------------------------- -------------
'
....
.
P la n s
W ork ers
(th o u s a n d s )
139
1, 619. 8
88
46
5
1, 131. 5
478. 2
10. 1
13 T h e p e n s io n and the e a r n in g s a r e e x p r e s s e d in the s a m e tim e unit,
i. e. , m o n th ly p e n s io n s a r e b a s e d on m o n th ly e a r n in g s , and ann u al p e n s io n s a r e
b a s e d on a n n u al e a r n in g s . In a d d itio n , s o m e p la n s c o m b in e the la s t tw o f a c t o r s —
e a r n in g s and s e r v i c e — b y a p p ly in g the p e r c e n t a g e f a c t o r to e a c h y e a r * s c r e d it e d
e a r n in g s and su m m in g the a m o u n ts s o c o m p u te d .
9
O f the 88 p la n s u s in g a s in g le p e r c e n t a g e f a c t o r , 54 u s e d a 1- p e r c e n t
f a c t o r (t a b le 11). P la n s in the b a s i c s t e e l in d u s tr y , an im p o r ta n t e x a m p le o f th is
u s e , p r o v id e d a b a s i c f o r m u la o f 1 p e r c e n t o f a v e r a g e m o n th ly e a r n in g s d u r in g
the 120 m o n th s im m e d ia t e ly p r e c e d in g r e t ir e m e n t , m u lt ip lie d b y y e a r s o f s e r v i c e .
T h e f a c t o r s fou n d in the o th e r u n ifo r m p e r c e n t a g e p la n s s tu d ie d ra n g e d f r o m
0. 40 to 2. 0 p e r c e n t .
A p p lic a t io n o f d if fe r e n t p e r c e n t a g e f a c t o r s a t s p e c if ie d e a r n in g s l e v e l s
w a s s tip u la te d in 46 p la n s . T o in t e g r a te w ith s o c i a l s e c u r it y , a ll but th r e e p la n s
u s e d a l a r g e r f a c t o r f o r e a r n in g s o v e r a s p e c if ie d a m o u n t than b e lo w . 14 A b o u t
tw o ou t o f f iv e p la n s o f th is ty p e a p p lie d a 1- p e r c e n t f a c t o r to c r e d it e d e a r n in g s
b e lo w a s p e c if ie d a m ou n t, and e ith e r 1. 50 o r 2. 0 p e r c e n t to e a r n in g s a b o v e that
a m o u n t (ta b le 12).
T h r e e -fift h s o f the r e m a in in g p la n s a p p lie d a f a c t o r g r e a t e r
than 1- p e r c e n t to the lo w e r p o r t io n and, w ith on e e x c e p t io n , b e tw e e n 1. 50 and
2. 50 p e r c e n t to th e h ig h e r .
T h e e a r n in g s l e v e ls at w h ic h the p e r c e n t a g e f a c t o r s
ch a n g e d a ls o v a r ie d w id e ly , r e f l e c t i n g the v a r ia t io n s in the m a x im u m a m o u n ts
c o n s i d e r e d in c o m p u tin g s o c i a l s e c u r it y b e n e fit s at the t im e the p la n s w e r e a d o p te d
o r a m e n d e d . 15 T h e l e v e ls a t w h ich the s e c o n d p e r c e n t a g e a p p lie d , w ith on e e x
c e p tio n , t h e r e f o r e r a n g e d f r o m $ 3 ,0 0 0 to $ 4 ,8 0 0 a y e a r .
S o m e p la n s m a k e
a u to m a tic a d ju s tm e n ts w h en the m a x im u m ta x a b le w a g e b a s e on w h ich s o c i a l s e
c u r it y b e n e fits a r e c o m p u te d is i n c r e a s e d .
A lm o s t h a lf the p la n s w h e r e b a s i c b e n e fit s v a r i e d b y b o th e a r n in g s and
s e r v i c e c o n ta in e d a p r o v i s io n f o r d i r e c t r e d u c t io n b y p r i m a r y s o c i a l s e c u r it y
b e n e fit s (o n ly fo u r o f th e s e p la n s w e r e fou n d to u s e tw o p e r c e n t a g e f a c t o r s ) .
M o s t o f the p la n s w ith r e d u c t io n s fo llo w e d the b a s ic s t e e l p a tte r n b y s p e c ify in g
an $ 8 5 d e d u c tio n f o r p r i m a r y s o c i a l s e c u r it y b e n e fits f r o m the a m o u n t d e t e r m in e d
b y a f o r m u la u tiliz in g a 1- p e r c e n t f a c t o r o r ,
in fo u r p la n s , a h ig h e r f a c t o r
(ta b le 11). S om e p la n s w ith p e r c e n t a g e f a c t o r s ra n g in g f r o m 1 to 2 p e r c e n t r e
d u c e d the b a s ic f o r m u la b y e ith e r a ll o r , m o r e fr e q u e n tly , o n e -h a lf the p r i m a r y
s o c i a l s e c u r it y b e n e fit . N o s o c i a l s e c u r it y o f f s e t w a s fou n d , h o w e v e r , in p la n s
w ith fo r m u la s u sin g a f a c t o r o f l e s s than 1 p e r c e n t .
B e n e fits R e la te d to S e r v i c e . — M o s t p la n s in w h ich the b e n e fit s v a r i e d b y
s e r v i c e a lo n e co m p u te d n o r m a l m o n th ly r e t ir e m e n t b e n e fit s b y m u ltip ly in g a s p e c i
f ie d d o lla r a m ou n t b y the n u m b e r o f y e a r s o f c r e d it e d s e r v i c e .
The m a jo r p r o
g r a m s in the auto in d u s try , f o r e x a m p le , p r o v id e d a m o n th ly b e n e fit co m p u te d b y
m u ltip ly in g $ 2 .5 0 b y the n u m b e r o f y e a r s o f c r e d it e d s e r v i c e a c c u m u la t e d a ft e r
a s p e c if ie d d a te. 16 S om e p la n s o f th is ty p e lim it e d the y e a r s o f c r e d it e d s e r v i c e
that c o u ld b e u s e d to co m p u te b e n e fit s , e. g. , $ 2 . 25 t im e s y e a r s o f c r e d it e d
s e r v i c e up to a m a x im u m o f 30 y e a r s .
A n o th e r v a r ia t io n w a s a f o r m u la u n d e r
w h ich a fla t a m ou n t (e . g. , $ 1 5 0 m o n th ly ) w a s p r o v id e d w o r k e r s w h o c o m p le t e a
r e q u ir e d p e r io d o f s e r v i c e (25 y e a r s ) w ith the b e n e fit b e in g r e d u c e d f o r l e s s s e r v
i c e ( $ 5 p e r m o n th f o r e a ch y e a r o f s e r v i c e l e s s than 25) to a m in im u m a m o u n t
( $ 1 0 0 f o r 15 y e a r s o f s e r v i c e — the m in im u m s e r v i c e to q u a lify f o r b e n e fit s ).
T h e d o lla r a m ou n ts u s e d in c o m p u tin g m o n th ly b e n e fit s v a r ie d w id e ly ,
ra n g in g f r o m $1 to $ 7 .5 0 (ta b le 13).
F o r a ll but 10 p la n s , th is b e n e fit w a s
e x c lu s iv e o f any s o c i a l s e c u r it y b e n e fit to w h ich the w o r k e r w o u ld b e c o m e e n
title d .
T h e fo r m u la s w ith s o c i a l s e c u r it y o f f s e t s p r o v id e d $ 3 . 33 o r m o r e a
14
B oth o f the p la n s w ith a s m a l le r r a t h e r than a l a r g e r f a c t o r a p p lic a b le to
the u p p e r e a r n in g s ra n g e u s e d the o f fs e t m e th o d to in t e g r a te w ith s o c i a l s e c u r it y .
S ee fo o tn o te 11 f o r m a x im u m e a r n in g s c r e d it e d u n d er the a c t.
16 U nder th e s e p la n s , a w o r k e r w o u ld r e c e i v e $ 2 . 50 t im e s y e a r s o f s e r v
i c e on o r a ft e r a s p e c if ie d d a te, e. g. , N o v e m b e r 1, 1959, and $ 2 .4 0 tim e s
y e a r s o f s e r v i c e p r i o r to th at d a te .
10
m o n th f o r e a c h y e a r o f c r e d it e d s e r v i c e .
R e fle c t in g the in flu e n c e o f the m a jo r
a u to p la n s , a b ou t a th ird o f the s e r v i c e fo r m u la s s p e c if ie d $ 2 . 50.
A fe w p la n s
s e t a fla t m o n th ly a m ou n t f o r s p e c if ie d c r e d it e d s e r v i c e w ith a n o n p r o p o r t io n a l
r e d u c t io n o f b e n e fit s f o r l e s s s e r v i c e .
A lit t le m o r e than h a lf o f the p la n s co n ta in in g s e r v i c e f o r m u la s p la c e d
a m a x im u m lim it a t io n on c r e d it e d s e r v i c e s u s e d to c o m p u te b e n e fit s — u s u a lly
25 o r 30 y e a r s .
T h u s, the r e s t o f the fo r m u la s o f th is typ e (in 53 p la n s ) d id
n ot f i x a m a x im u m lim it on s e r v i c e o r on b e n e fit s .
F la t B e n e fit f o r S p e c ifie d S e r v i c e . ---- T h e b a s i c b e n e fit f o r m u la s in w h ich
u n ifo r m a m o u n ts w e r e p r o v id e d to a ll w o r k e r s w h o c o m p le t e the r e q u ir e d s e r v i c e —
the l e a s t c o m m o n ty p e o f f o r m u la fou n d in th is study---- w e r e , in a ll b u t tw o c a s e s ,
c o n ta in e d in m u lt ie m p lo y e r p la n s . T h e s e in c lu d e d p la n s n e g o tia t e d b y the I n t e r
n a tio n a l L a d i e s 1 G a r m e n t W o r k e r s 1 U nion, the A m a lg a m a te d C lo th in g W o r k e r s
o f A m e r i c a , and the U nited M in e W o r k e r s o f A m e r i c a .
T h is a p p r o a c h is a ls o
w id e ly u s e d in p la n s in the c o n s t r u c t io n t r a d e s .
In a b o u t a th ird o f the 31 f la t
b e n e fit p la n s , $ 5 0 a m on th w a s p r o v id e d r e t i r e e s fu lfillin g the s p e c if ie d r e q u i r e
m e n ts (ta b le 14).
Th e r e m a in in g p la n s p r o v id e d a m o u n ts r a n g in g f r o m $ 2 0 to
$ 1 3 0 a m on th .
O nly th r e e u n ifo r m b e n e fit p la n s o f fs e t the fla t b e n e fit b y p r i
m a r y s o c i a l s e c u r it y b e n e fit s .
M in im u m B e n e fit F o r m u la s . — M any p e n s io n p la n s p r o v id e a f l o o r u n d e r
n o r m a l r e t ir e m e n t b e n e fit s b y g u a ra n te e in g a m in im u m b e n e fit d e t e r m in e d b y a
s e p a r a t e fo r m u la , w h ich , f o r w o r k e r s w ith c e r t a in e a r n in g s and s e r v i c e , y i e ld s
a h ig h e r b e n e fit than that due u n d er the b a s ic r e t ir e m e n t fo r m u la p r e v i o u s l y d i s
cu ssed.
O f the 300 p la n s stu d ie d , o n ly 39 p r o v id e d b e n e fit s at n o r m a l r e t ir e m e n t
a g e p r e c i s e l y a s the fo r m u la p r e s c r i b e d , n o m a tte r h o w s m a ll the r e t ir e m e n t
a n n u ity m ig h t b e . (S ee ta b le 8.) On the o th e r hand, in 149 p la n s the m in im u m b e n e
f it w a s in c lu d e d in the b a s ic f o r m u la , a s in a fla t b e n e fit fo r m u la o r a s e r v i c e o n ly f o r m u la w h ich stip u la te d the m in im u m s e r v i c e f o r w h ich a p e n s io n w o u ld b e
g r a n te d ; w o r k e r s n ot fu lfillin g th e s e m in im u m r e q u ir e m e n t s w o u ld r e c e i v e n o
b e n e f it s .
T h e r e m a in in g 112 p la n s c o n ta in e d a m in im u m b e n e fit fo r m u la w h ich
m o d if ie d the b a s i c f o r m u la , g e n e r a lly to the a d v a n ta g e o f l o w e r in c o m e and
s h o r t e r s e r v i c e p e n s io n e r s . In m a n y p la n s , a s in the s t e e l in d u s tr y , the m i n i
m u m b e n e fit fo r m u la a p p lie d to the m a jo r i t y o f r e t ir e d w o r k e r s .
A ll b u t 10 o f the 112 p la n s w ith a s e p a r a te m in im u m b e n e fit s f o r m u la
had a b a s i c fo r m u la b a s e d on e a r n in g s and s e r v i c e (ta b le 15).
M o s t m in im u m
p e n s io n s w e r e b a s e d s o le ly on s e r v i c e ; the r e s t had a fla t m in im u m p e n s io n o r
a n o th e r ty p e o f f o r m u la .
M an y p la n s in the b a s ic s t e e l in d u s tr y , f o r e x a m p le ,
p r o v id e d , in a d d itio n to the b a s i c n o r m a l r e t ir e m e n t fo r m u la p r e v i o u s l y d e s c r i b e d ,
a m in im u m g u a ra n te e o f $ 2 .5 0 p e r y e a r o f c r e d it e d s e r v i c e a ft e r O c to b e r 31,
1957, and $ 2 0 40 p e r y e a r o f c r e d it e d s e r v i c e p r i o r to N o v e m b e r 1, 1957, up to a
m a x im u m o f 30 y e a r s . 17 The le a s t c o m m o n a p p r o a c h w a s fou n d in p la n s in w h ich
the f o r m u la s f o r b o th b a s i c and m in im u m b e n e fit s w e r e b a s e d on the s a m e f a c t o r s ,
b u t w ith d if fe r e n t v a lu e s .
A fo u r th o f the m in im u m b e n e fit f o r m u la s — a b o u t the s a m e p r o p o r t io n
a s the b a s i c f o r m u la s — w e r e s u b je c t to s o c i a l s e c u r it y o f f s e t s .
O ver th re e fifth s o f s u ch p la n s d e d u c te d a ll p r i m a r y s o c i a l s e c u r it y b e n e fit s (ta b le 16).
O ffs e t b a s i c b e n e fit fo r m u la s w e r e u s e d b y a b o u t a th ir d o f th e s e p la n s .
17
T h e s e b e n e fits a r e e x c lu s iv e o f s o c i a l s e c u r i t y .
In J a n u a ry I 9 6 0 ,
p a r t ie s n e g o tia t e d an i n c r e a s e f o r e m p lo y e e s r e t ir in g a ft e r J a n u a ry 1, I9 6 0 , to
$ 2 .6 0 a m on th p e r y e a r o f s e r v i c e a ft e r D e c e m b e r 3 1 , 1959, and $ 2 .5 0 a m on th
p e r y e a r o f s e r v i c e b e fo r e J a n u a ry 1, I 9 6 0 .
the
11
V a r ia b le B e n e fi t s . — A n im p o r ta n t c o n s id e r a t io n f o r w o r k e r s w h o h av e
r e t i r e d o r w h o a r e a b o u t to r e t i r e is the p r o t e c t io n o f p e n s io n b e n e fit s f r o m the
e r o d in g e f fe c t s o f r i s in g liv in g c o s t s . A m o n g the 300 p la n s in th is stu d y , 3 p la n s
p r o v id e d f o r a d ju s tm e n ts in p e n s io n b e n e fit s g e a r e d to p r i c e c h a n g e s o r to p e n s io n
fun d e a r n in g s .
In one p la n , the n o r m a l b e n e fit f o r m u la w a s g e a r e d to the B u r e a u o f
L a b o r S ta tis tic s C o n s u m e r P r i c e In d ex. Th e p e n s io n b e n e fit
r e s u lt in g f r o m
the a p p lic a t io n o f the b a s i c b e n e fit fo r m u la w a s a d ju s te d a t r e t ir e m e n t and p e
r i o d i c a l l y t h e r e a ft e r to r e f l e c t the c h a n g e s in th is p r i c e in d e x .
T h is c la u s e
sta ted that:
A n a d ju s tm e n t o f an e m p lo y e e 1s p e n s io n w i ll b e m a d e b y m u lt i
p ly in g _ th e e m p lo y e e * s M on th ly B a s e F ig u r e / b a s i c p e n s io n
a m o u n t/ b y the " C o n s u m e r P r i c e In d e x ” la s t p u b lis h e d in the
6 m o n th s 1 p e r io d p r e c e d in g J a n u a ry 1 o f the y e a r o f the e m
p l o y e e ^ r e t ir e m e n t . . . and d iv id in g the r e s u l t b y 103. 7 (In
d e x f o r J u ly 1948 on n ew b a s i s ) .
T h e " C o n s u m e r P r i c e In d e x ”
s h a ll b e o f the o f f i c i a l C o n s u m e r P r i c e In d e x p u b lis h e d b y the
B u re a u o f L a b o r S t a t is t ic s , U. S. D e p a r tm e n t o f L a b o r (1 9 4 7 —
194 9= 1 00 ).
The p e n s io n a m ou n t w ill b e r e c o m p u t e d on e a c h
J u ly 1 and J a n u a ry 1 t h e r e a ft e r f o r the s u c e e d in g 6 m onths*
p e r io d .
In tw o p la n s in c lu d e d in th is stu dy, p a r t o f the r e t ir e m e n t b e n e fit v a r ie d
a c c o r d in g to the in v e s t m e n t e x p e r ie n c e o f the fund, and the r e s t w a s b a s e d on a
fix e d b e n e fit f o r m u la w h ich fo llo w e d the u s u a l p a tte r n to p r o v id e a fix e d in c o m e .
F o r e x a m p le , on e p la n s ta te d :
. . . T h e S u p p le m e n ta l F u tu re S e r v ic e R e t ir e m e n t B e n e fit. . . .
is a m o n th ly a m ou n t that w ill v a r y f r o m m o n th to m o n th o r f r o m
tim e to tim e , d e p e n d in g upon the . . . e a rn in g r a te r e q u ir e d
b y th is S e c tio n to b e a s s u m e d in co m p u tin g the a m o u n ts p la c e d
in the V a r ia b le B e n e fit A c c o u n t and the a ctu a l e a r n in g s , g a in s
o r l o s s e s th at o c c u r in c o n n e c t io n w ith in v e s t m e n t o f T r u s t a s
s e ts in the V a r ia b le B e n e fit A c c o u n t .
Such S u p p le m e n ta l F u tu re
S e r v ic e R e t ir e m e n t B e n e fit u pon an E m p lo y e e * s r e t ir e m e n t on
and a ft e r h is N o r m a l R e t ir e m e n t d a te s h a ll b e the v a r y in g
m o n th ly a m ou n t.
L e v e l o f B e n e fits
T h e b e n e fit fo r m u la s a lr e a d y d is c u s s e d p r o m i s e c o m p u ta b le p e n s io n s f o r
w o r k e r s w ho f u l f il l the n e c e s s a r y r e q u ir e m e n t s and w ho r e t ir e w h en th ey r e a c h
the n o r m a l r e t ir e m e n t a g e .
A s p o in te d out p r e v i o u s l y , o th e r fo r m u la s m a y a p p ly
to w o r k e r s w ho h ave a lr e a d y b u ilt up s e r v i c e c r e d it s ( i . e . , p a s t s e r v i c e ) .
T h u s,
the o n ly c o m m o n g r o u n d u pon w h ich a ll p e n s io n p la n s c a n b e put f o r p u r p o s e s o f
r e v e a lin g the l e v e l o f b e n e fit s o f f e r e d b y th e m and o f c o m p a r in g th e m is that o f
fu tu re s e r v i c e ; in o th e r w o r d s , the p e n s io n p r o m is e m a d e to a n e w ly h ir e d w o r k e r .
It m u s t b e e m p h a s iz e d that th e s e b e n e fit p r o v is io n s s h o u ld n o t be in t e r p r e t e d as
the a m ou n ts n ow p aid w o r k e r s w ho r e t i r e .
12
A d d itio n a l a s s u m p tio n s a r e n e c e s s a r y to p la c e a ll p la n s on a c o m p a r a b le
le v e l.
F o r p u r p o s e s o f th is stu d y , the fo llo w in g c o n d it io n s w e r e a s s u m e d in
co m p u tin g p o te n tia l b e n e fit a m o u n ts f o r e a c h p la n :
1. Th e w o r k e r w i ll r e t i r e at a g e 6 5 .
2. B e n e fits w e r e c o m p u te d f o r annual e a r n in g s l e v e l s o f $ 4 ,0 0 0 , $ 4 ,8 0 0 ,
and $ 5 ,6 0 0 , and fu tu r e s e r v i c e p e r i o d s o f 20 and 30 y e a r s .
T h e s e a r b it r a r y
e a r n in g s l e v e l s w e r e a s s u m e d to b e co n s ta n t th ro u g h o u t the w o r k e r fs c a r e e r ,
th e r e b y e lim in a tin g any d if f e r e n c e b e tw e e n p la n s b a s in g b e n e fit s on c a r e e r
e a r n in g s and th o s e u s in g a h ig h o r t e r m in a l p e r io d .
3. It w a s a s s u m e d that c u r r e n t m a x im u m p r i m a r y s o c i a l s e c u r it y b e n e
fit s w ill be r e c e i v e d b y e a c h r e t i r e e . F o r the s e le c t e d annual e a r n in g s l e v e l s ,
th e s e a r e $ 112 p e r m o n th f o r e a r n in g s o f $ 4 ,0 0 0 and $ 1 2 7 p e r m o n th f o r
e a r n in g s o f $ 4 ,8 0 0 and $ 5 ,6 0 0 .
T o b r in g to a c o m m o n l e v e l p la n s that o f f
s e t s o c i a l s e c u r i t y p a y m e n ts and th o s e that do n o t, it w a s n e c e s s a r y to d e
t e r m in e to ta l r e t ir e m e n t b e n e fit s in c lu d in g s o c i a l s e c u r i t y b e n e fit s .
U n d er th e s e a s s u m p t io n s , to ta l m o n th ly r e t ir e m e n t in c o m e (p r iv a t e p la n
b e n e fit p lu s p r i m a r y s o c i a l s e c u r it y b e n e fit) o f f e r e d b y the 300 p la n s s tu d ie d
r a n g e d f r o m $ 1 1 2 f o r a $ 4 , 0 0 0 - a - y e a r w o r k e r w ith 20 y e a r s o f fu tu re c r e d it e d
s e r v i c e (the c u r r e n t m a x im u m p r i m a r y s o c i a l s e c u r i t y b e n e fit f o r that l e v e l o f
e a r n in g s ) to o v e r $35 0 a m o n th f o r a w o r k e r e a rn in g $ 5 ,6 0 0 a y e a r w ith 30 y e a r s
o f fu tu re c r e d it e d s e r v i c e (ta b le 17).
O n ly p r i m a r y s o c i a l s e c u r it y b e n e fits w o u ld
b e p a y a b le u n d er s o m e p la n s b e c a u s e m o r e than 20 y e a r s o f c r e d it e d s e r v i c e w a s
r e q u ir e d to q u a lify f o r p r iv a t e p la n b e n e fit s o r b e c a u s e , a ft e r the d e d u c tio n o f
m a x im u m p r i m a r y s o c i a l s e c u r i t y b e n e f it s , 18 n o p r iv a t e p la n b e n e f it s w e r e p a ya b le.
O f the 300 p la n s s tu d ie d , a b ou t 2 out o f 3 p la n s p r o v id e d the w o r k e r w ith
20 y e a r s 1 s e r v i c e and e a r n in g $ 4 ,0 0 0 a y e a r a to ta l r e t ir e m e n t in c o m e (in c lu d in g
p r i m a r y s o c i a l s e c u r it y b e n e fit) e q u a l to at l e a s t h a lf h is p r e r e t ir e m e n t e a r n in g s
( b e f o r e d e d u c tio n s ) a s c o n t r a s t e d w ith a b ou t 1 ou t o f 4 p la n s at the $ 4 , 800 l e v e l ,
and 1 out o f 6 at the $ 5 ,6 0 0 l e v e l.
A s im i la r d is p a r it y is sh ow n f o r w o r k e r s
w ith 30 y e a r s o f s e r v i c e (ta b le 17).
The a v e r a g e n o r m a l r e t ir e m e n t b e n e fit , 19 in c lu d in g m a x im u m p r i m a r y
s o c i a l s e c u r it y b e n e f it s , w a s $ 1 6 7 .4 4 a m o n th f o r a $ 4 , 0 0 0 - a - y e a r w o r k e r w ith
20 y e a r s o f s e r v i c e o r a b ou t h a lf o f h is g r o s s e a r n in g s p r i o r to r e t ir e m e n t
(ta b le 18 and c h a r t 1).
F o r w o r k e r s w ith 30 y e a r s o f s e r v i c e , th is p r o p o r t i o n
in c r e a s e d to 56 p e r c e n t .
On the a v e r a g e , w o r k e r s w ith e a r n in g s o f $ 4 , 800 and
$ 5 ,6 0 0 r e c e i v e d s m a l le r p r o p o r t i o n s o f th e ir p r e r e t ir e m e n t m o n th ly in c o m e than
th o s e e a rn in g $ 4 ,0 0 0 .
T h is is a ttr ib u ta b le to s e v e r a l f a c t o r s :
(1) The b a s ic
b e n e fit s p r o v id e d b y h a lf the p la n s w e r e u n r e la te d to e a r n in g s .
M oreover, bene
f it s in a n o th e r la r g e g r o u p o f p la n s — s u ch a s th o s e in the b a s ic s t e e l in d u s t r y —
f o r the a s s u m e d s e r v i c e and e a r n in g s l e v e ls w e r e h ig h e r u n d e r the m in im u m f o r
m u la b a s e d s o le l y on s e r v i c e than u n d e r the b a s ic s e r v i c e and e a r n in g s fo r m u la .
18 A lth ou g h the c o m p u ta tio n s m a d e u n d e r c o n d it io n s a s s u m e d b y th is stu dy
in d ic a te that s o m e p la n s p r o v id e lit t le o r n o b e n e fit , th e s e a r e n ot n e c e s s a r i l y
the a m ou n ts c o m m o n ly p r o v id e d b y the p la n .
U n d er p la n s w h ic h p r o v id e a b e n e fit
l e v e l in c lu d in g p r i m a r y s o c i a l s e c u r it y b e n e f it s , w o r k e r s w h o d o n ot r e c e i v e m a x i
m u m p r i m a r y b e n e fits w o u ld r e c e i v e m o r e f r o m the p r iv a t e p la n than u n d e r the
a s s u m p tio n s u s e d in th is stu d y .
T h is c o m m e n t is p a r t ic u la r l y a p p r o p r ia t e in l o w w a g e in d u s t r ie s w h e r e the p e n s io n b e n e fit fo r m u la is o fte n b a s e d s o le l y on s e r v i c e .
19 A r it h m e t ic m e a n o f n o r m a l r e t ir e m e n t b e n e f it s , in c lu d in g s o c i a l s e c u r i t y
b e n e f i t s , w e ig h te d b y n u m b e r o f w o r k e r s c o v e r e d .
13
(2) M a x im u m b e n e fit lim it a t io n s h e ld dow n b e n e fit s in a n u m b e r o f o th e r p la n s .
(3) S o c ia l s e c u r it y b e n e fit s a r e a s m a l le r f r a c t i o n o f e a r n in g s at the h ig h e r
e a r n in g s l e v e l s .
B e n e fit a m o u n ts p a id b y the p r iv a t e p la n ( e x c lu s iv e o f s o c i a l s e c u r it y )
r a n g e d u p w a rd s to m o r e than $20 0 p e r m o n th f o r $ 5 , 6 0 0 - a - y e a r w o r k e r s w ith
30 y e a r s o f s e r v i c e (ta b le 19).
The a v e r a g e p a y m e n ts m a d e b y the p la n s ra n g e d
f r o m $ 5 5 .4 4 p e r m on th f o r the $ 4 , 0 0 0 - a - y e a r w o r k e r s w ith 20 y e a r s to $ 8 6 .8 3
f o r th o s e w h o e a r n $ 5 ,6 0 0 w ith 30 y e a r s ' s e r v i c e .
L a r g e r b e n e fits w e r e , f o r the m o s t p a r t, p r o v id e d b y c o n t r ib u t o r y than by
n o n c o n tr ib u to r y p la n s. F o r e x a m p le , m o r e than 90 p e r c e n t o f the f o r m e r as c o m
p a r e d w ith 19 p e r c e n t o f the la t t e r p r o v id e d a to ta l b e n e fit, in c lu d in g p r im a r y s o c i a l
s e c u r i t y b e n e fit s , o f at le a s t h a lf o f the w o r k e r 's a v e r a g e e a r n in g s f o r th o s e w ith
30 y e a r s o f s e r v i c e and e a r n in g s o f $ 5 ,6 0 0 (ta b le 20). A t the $ 4 ,0 0 0 and 30 y e a r s '
s e r v i c e l e v e l , c o n t r ib u t o r y p la n s a ls o p r o v id e d l a r g e r b e n e fits (ta b le 21).
A s p r e v i o u s l y p o in te d ou t, m a n y p la n s that p r o v id e d a b a s ic b e n e fit f o r
m u la b a s e d on e a r n in g s and s e r v i c e had a s e p a r a te m in im u m b e n e fit fo r m u la b a s e d
o n s e r v i c e a lo n e . ( S e e ta b le 15.) U n d er the a s s u m p tio n s u s e d in th is stu d y , 202 and
193 o f the 300 c o m p u ta tio n s m a d e f o r the $ 4 ,0 0 0 - and $ 5 , 6 0 0 - a - y e a r w o r k e r s ,
r e s p e c t i v e l y , w e r e b a s e d on s e r v i c e fo r m u la s e v e n th ou gh o n ly 151 p la n s h ad b a s ic
fo r m u la s b a s e d s o le l y on s e r v i c e .
The b e n e fit a m o u n ts c o m p u te d f o r s e r v i c e f o r
m u la s and s e r v i c e and e a r n in g s fo r m u la s a r e sh ow n s e p a r a t e ly in ta b le s 22 and 23.
The a d v a n ta g e to h ig h e r p a id w o r k e r s u n d e r the s e r v i c e a n d e a r n in g s f o r m u la is
d e m o n s tr a t e d b y th is c o m p a r i s o n o f the b e n e fits f o r $ 4 ,0 0 0 - and $ 5 , 6 0 0 - a - y e a r
w o r k e r s r e t ir in g w ith the s a m e s e r v i c e .
C h a n g es S in ce 1952. — I n c r e a s e s in b o th p la n b e n e fit s and p r i m a r y s o c i a l
s e c u r i t y b e n e fit s s in c e 1952 a c c o u n t f o r a s u b s ta n tia l in c r e a s e in the to ta l r e t i r e
m e n t in c o m e to w h ic h w o r k e r s m ig h t lo o k f o r w a r d .
The m a x im u m p r i m a r y s o c i a l
s e c u r i t y b e n e fit w a s r a i s e d f r o m $85 a m o n th f o r a w o r k e r e a r n in g $ 3 ,6 0 0 o r
m o r e a y e a r to $ 1 1 2 f o r the $ 4 , 0 0 0 - a - y e a r w o r k e r , and to $ 12 7 f o r w o r k e r s
a v e r a g in g $ 4 ,’ 800 and h ig h e r l e v e l s .
B e n e fits u n d e r m a jo r p la n s in the a u t o m o b ile
in d u s tr y w e r e r e v i s e d u p w a r d s in 1953, 1955, and 1958, w h ile b a s ic s t e e l p la n s
w e r e im p r o v e d in 1954 and 1956.
(F u r t h e r im p r o v e m e n t s m a d e in the b a s ic s t e e l
p la n s in I9 60 o c c u r r e d to o la te to b e c o n s i d e r e d in th is s t u d y .)
C o m p a r is o n b e tw e e n the B u r e a u 's 1952 c o m p u ta tio n s o f fu tu re s e r v i c e
b e n e fit s in 300 p e n s io n p la n s and the r e s u lt s o f the p r e s e n t stu dy c a n b e m a d e
o n ly w ith r e f e r e n c e to the $ 4 , 0 0 0 - a - y e a r w o r k e r .
D is t r ib u tio n o f the p la n s in
c lu d e d in e a c h stu dy by the m o n th ly b e n e fit p r o m i s e d the $ 4 , 0 0 0 - a - y e a r w o r k e r
a ft e r 30 y e a r s o f s e r v i c e , in c lu d in g m a x im u m p r i m a r y s o c i a l s e c u r it y b e n e fits
($ 8 5 in 1952 and $112 in 195 9), sh ow that the c lu s t e r in g o f p la n s at the lo w e r
en d o f the b e n e fit s c a le that c h a r a c t e r iz e d the 1952 d is tr ib u t io n h as ch a n g e d to
a m o r e s y m m e t r ic a l d is tr ib u t io n (c h a r t 2 ).
The p r in c ip a l r e a s o n f o r th is ch a n ge
is u n d ou b ted ly the r e v is i o n s n e g o tia t e d b y the p a r t ie s .
M o r e o v e r , as p r e v i o u s l y
e x p la in e d , the i n c r e a s e in s o c i a l s e c u r it y b e n e fit s d id n ot a ff e c t a ll fu tu re p e n
s io n e r s e q u a lly b e c a u s e o f o f f s e t fo r m u la s in s o m e p la n s .
In a b s o lu te a m o u n ts , it is lik e ly that the i n c r e a s e s f o r the $ 4 , 8 0 0 - and
$ 5 , 6 0 0 - a - y e a r w o r k e r s w e r e l a r g e r , s in c e th e ir s o c i a l s e c u r it y m a x im u m r o s e
b y $ 42 a s a g a in s t the $ 27 i n c r e a s e at the $ 4 , 0 0 0 -a -y e a r l e v e l.
In r e la t iv e t e r m s ,
h o w e v e r , th is i n c r e a s e m a y h a v e b e e n c o u n t e r a c t e d s o m e w h a t b y the g r e a t e r e m
p h a s is on s e r v i c e (at th e s e e a r n in g s l e v e l s ) in 1959 p la n s , p a r t ic u la r l y in the
s t e e l in d u s tr y .
20
M a x im u m p r i m a r y s o c i a l s e c u r i t y b e n e fits a r e c u r r e n t ly 33. 6, 3 1 .8 ,
2 7 .2 p e r c e n t o f a v e r a g e annual e a r n in g s o f $ 4 ,0 0 0 , $ 4 ,8 0 0 , and $ 5 ,6 0 0 , r e s p e c t i v e l y .
and
14
Chart 1. Average Monthly Normal Retirement
Benefits for Selected Annual Earnings and Years of
Future Service,1 Fall 1959 2
Fora Worker Earning—
Dollars
$4,000 a Year
20
30
$4,800 a Year
20
30
$5,600 a Year
20
30
Years o f Service
[X W ^I Private plan b e n e fit
Y ////A
Maximum primary social security ben efit
^ Arithmetic mean of normal retirement benefits including primary social security benefits, weighted by number of workers
covered. Benefit amounts are based on future service formulas, assuming a constant level of earnings, and monthly
primary social security benefits of $112 for workers earning $4,000 per year and of $127 for workers earning
$4,800 or $5,600 per year.
2Based on a study of 300 selected pension plans under collective bargaining,
covering approximately 4,670,000 workers.
UNITED STATES DEPARTMENT OF LABOR
BUREAU
OF
LABOR
STATISTICS
15
Chart 2. Monthly Normal Retirement Benefits for
a Worker Earning $4,000 a Year with 30 Years
of Future Service* 1952 and 1959 8
PERCENT OF PLANS
Under $90 to $110to $130to $150to $175to $200 to $225 to $250 and
$90
$110
$130
$150
$175 $200 $225
$250
Over
Monthly Normal Benefits
1 Monthly benefits under private pension plans plus primary social security benefits. Benefit amounts are based on 30 years
of future service, assuming a constant level of earnings of $4,000 a year, and including monthly primary social security
benefits of $85 and $112 in 1952 and 1959, respectively.
2 Based on a study of 300 selected pension plans under collective bargaining in effect in late 1952 and the fall of 1959,
identical except for the substitution of 81 plans. In 1959, the plans covered approximately 4,670,000 workers.
UNITED STATES DEPARTMENT OF LABOR
BU R EA U
OF L A B O R
STA TISTIC S
16
T a b le 1.
D is tr ib u tio n o f plans stu died b y n u m b e r o f w o r k e r s c o v e r e d
and m e th o d o f fin a n c in g , fa ll 1959
_____________________________(W o rk e rs in th ou san d s)
A ll plans
N u m ber of w o r k e r s
covered
W orkers
N um ber
C o n tr ib u to r y
N o n c o n trib u to r y
P lan s
W orkers
P lans
W orkers
A ll plans stu died -----------------------------------------
300
4 ,6 7 2 . 7
251
3 ,9 0 1 .9
49
770. 8
1 ,0 0 0 and u n d er 2 ,0 0 0 w o r k e r s ---------------2 ,0 0 0 and u n d er 3, 000 w o r k e r s --------------3, 000 and u n d er 4, 000 w o r k e r s --------------4, 000 and u n d er 5, 000 w o r k e r s ---------------5, 000 and u n d er 7, 500 w o r k e r s --------------7, 500 and u n d er 10, 000 w o r k e r s -------------10, 000 and u n d er 1 5, 000 w o r k e r s ----------1 5 ,0 0 0 and u n d er 2 5 ,0 0 0 w o r k e r s ----------2 5 ,0 0 0 and u n d er 5 0 ,0 0 0 w o r k e r s ----------50, 000 and u n d er 100, 000 w o r k e r s --------1 0 0 ,0 0 0 w o r k e r s and o v e r -------------------------
55
41
35
22
28
18
36
23
22
9
11
78. 1
99. 1
115. 8
95. 0
165. 4
149. 1
4 1 0 .9
418. 8
704. 6
613. 5
1 ,8 2 2 . 4
43
34
31
19
23
16
29
18
20
9
9
6 1 .4
8 1 .5
102. 6
82. 4
1 3 4 .4
132. 1
325. 6
3 2 9 .2
632. 8
613. 5
1 ,4 0 6 . 4
12
7
4
3
5
2
7
5
2
16. 7
17. 6
1 3 .2
12. 6
3 1 .0
17. 0
85. 3
89. 6
7 1 .8
-
-
2
416. 0
D is tr ib u tio n o f p lan s stu died b y in d u s tr y g r o u p , m eth od o f fin a n c in g , and
type o f b a r g a in in g u nit, fa ll 1959
(W o r k e r s in thou s a n d s )
Method of financing
Type of bargaining unit
A ll
Industry group
Single employer
Num
ber
W ork
ers
Plans
W ork
ers
Multiemployer
Plans
W ork
ers
Noncontributory
Plans
W ork
ers
Contributory
Plans
W ork
ers
A ll industries ----------------------------------------------
300
4 , 6 7 2 .7
231
2 ,9 4 6 . 4
69
1 ,7 2 6 . 3
251
3 ,9 0 1 .9
49
770. 8
Manufacturing ------------------------------------
229
3 ,2 0 9 . 6
197
2 ,6 3 9 . 8
32
569. 8
195
2 ,8 2 1 . 1
34
388. 5
Food and kindred products ----------------------Tobacco manufactures -----------------------------Textile m ill p ro d u cts---------------------------------Apparel and other finished
textile products ----------------------------------------Lumber and wood products,
except furniture ---------------------------------------Furniture and fixtures -------------------------------Paper and allied p ro d u cts-------------------------Printing, publishing, and
allied industries ---------------------------------------Chem icals and allied products ----------------Petroleum refining and
related industries ------------------------------------Rubber and m iscellaneous
plastics products -------------------------------------Leather and leather products -------------------Stone, clay, and glass products ---------------P rim ary m etal in d u strie s-------------------------Fabricated m etal p roducts------------------------Machinery, except electrical -------------------Electrical m achinery, equipment,
and supplies ---------------------------------------------------------------Transportation equipment ----------------------------------Instruments and related products ---------------M iscellaneous manufacturing
in d u strie s ------------------------------------------------------------------------
17
3
185. 0
26. 1
39. 4
12
7 0 .2
5
114. 8
11
28. 4
26. 1
16. 8
-
2
22. 6
3
7
-
6
156. 6
26. 1
30. 4
6
3
8
1
9. 0
9
32 5 .9
1
1. 3
8
324. 6
9
3 2 5 .9
-
-
2
1
8
13. 7
1
3
4
5
23. 1
42. 7
17. 1
5
16. 2
119. 6
Nonmanufacturing
----------------------------------------
Mining, crude petroleum , and
natural gas production ---------------------------------------Contract construction ---------------------------------------------Transportation 1 ------------------------------------------------------------Communications ----------------------------------------------------------U tilities: E lectric and gas --------------------------------W holesale and retail tr a d e ----------------------------------Hotels and restaurants -----------------------------------------Services ------------------------------------------------------------------------------M iscellaneous nonmanufacturing
in d u strie s ------------------------------------------------------------------------
2.0
3
1
9 .4
40. 7
4. 5
1
4. 3
4
11 .9
13
121. 1
23. 1
42. 7
50. 1
5
13
1 6.2
121. 1
81. 7
9
81. 7
-
8
106. 9
-
3
-
201.2
33
13
27
30.
74.
588.
113.
194.
24
4
316. 3
805. 0
19. 4
14
24
4
9
33. 5
9
8
4
10
33
13
28
16
106.
40.
74.
588.
113.
9
3
4
3
0
71
1 ,4 6 3 .1
6
12
221.6
4
405. 0
468. 2
1 53.2
64. 3
50. 1
39. 0
31. 7
4
30. 0
17
4
14
8
2
-
45. 6
3
4
9
E x clu d e s r a ilr o a d and a ir lin e in d u s t r ie s .
-
-
-
12
-
-
-
33. 0
4
-
-
1
1 .5
-
1
1. 1
8
80. 6
8
-
32
13
26
10 6 .9
40. 3
74. 4
5 7 1 .9
113. 0
184. 4
1
16. 4
1
10. 0
6. 5
309. 4
805. 0
1 9 .4
2
6 .9
-
-
11
20
2
163. 0
75 9 .2
15. 7
5
15. 6
4
1 7 .9
9
33. 5
34
306. 6
37
1, 156. 5
56
1 , 0 8 0 .8
15
382. 3
4
21.6
2
12
200. 0
5
405. 0
421. 7
11
11
218. 0
105. 0
435. 0
153.2
39. 8
50. 1
3 9 .0
3 1 .7
1
1
6
3. 6
3 0 0 .0
3 3 .2
10
-
10
4
14
3
4
3
0
7
-
46. 5
153.2
64. 3
1
7
-
-
8
2
2
-
-
-
-
4
50. 1
39. 0
3 1 .7
2
21. 0
2
9 .0
-
4
9
-
8
2
-
4
10
4
9 .0
-
-
2
5
4
2
-
1 6
.
8
153. 3
45. 8
3. 7
-
-
-
5
24. 5
-
-
-
-
-
-
2
21.0
17
T a ble 3.
M in im um age and s e r v ic e r e q u ir e m e n ts f o r p a r t ic ip a t io n
in p e n s io n p la n s , fa ll 1959 1
(W o rk e rs in th ou san d s)
Minimum age requirem ents
A ll plans
Minimum service
requirements
A ll plans with preparticipation
requirements --------------------------------------------Service req uirem ent-----------------------------------1 year -----------------------------------------------------------2 years ---------------------------------------------------------3 years ----------------------------------------------------------5 years ---------------------------------------------------------A lte rn a tiv e s--------------------------------------------------
Num
ber
W ork
ers
72
622. 1
7
31
7
12
12
3
25. 6
2 7 6 .2
62. 0
142. 1
6 1 .9
54. 3
No age
reaui:rement
W ork
Plans
ers
40
_
24
3
8
5
“
3 7 1 .5
_
255. 6
23. 1
73. 6
1 9.2
■
Age 2 5
Plans
W ork
ers
10
5 1 .9
22
3
1
2
2
“
14
114.9
3
3
11. 5
9 .4
13. 0
“
42
2
Based on a studyof 300 selected pension plans
under collective bargaining
1 plan provided
a minimum requirement
of age 2 1 .
1 plan provided a minimum requirement
of age 40.
1 plan provided a minimum requirement
of age 2 5 for women.
This plan provided a minimum requirement of age 30 for women.
Includes 1 plan covering 1 0 ,0 0 0 workers that provided for alternatives
35 and 1 year of service; 1 plan with 4 0 ,0 0 0 workers for 5 years of service , or
with 4 ,3 0 0 workers for age 35 and 5 years of service , or if hired after age 45,
Ag<e 35
W ork
ers
6. 0
12. 0
1
2
3
4
5
6
Table 4.
Ag<5 30
Plans
5. 4
5. 5
1 7 .4
59. 1
2 7. 5
"
4
"
Plans
Alternatives
W ork
ers
5
Plans
3
29. 5
-
14.2
3. 1
10. 0
-
51
2.2
-
”
32
1
1
_
W ork
ers
54. 3
_
-
-
-
-
-
63
-
54. 3
covering approximately 4, 670, 000 w orkers.
of age 25 and 5 years of service , or age
age 30 and 2 years of service; and 1 plan
age 50 and Vz year of service.
Preparticipation requirements not credited as service for eligibility
for norm al retirem ent, fall 1959 1
(W orkers in thousands)
Minimum age requirements
Minimum service
requirements
A ll plans
Num
ber
Plans with preparticipation
requirem ent not credited for
norm al retirem ent -----------------------------------No service requirement ----------------------------1 year of service -------------- .-------------------------2 years of s e r v i c e ---------------------------------------3 years of service ---------------------------------------5 years of service ---------------------------------------Alternatives -------------------------------------------------
W ork
ers
64
593. 5
7
28
25. 6
268. 8
5 9.2
133. 7
5 1 .9
54. 3
6
11
9
3
No age
requirement
W ork
Plans
ers
33
.
21
2
7
3
346. 9
_
2 4 8 .2
20. 3
65. 2
13.2
■
25
Plans
30
W ork
ers
W ork
ers
114. 9
9
47. 9
14
22
6. 0
12. 0
3
3
11. 5
9. 4
9. 0
"
42
2
3
1
2
1
~
35
Plans
4
■
5.
5.
17.
59.
2 7.
"
4
5
4
1
5
Plans
Alternatives
W ork
ers
5
29. 5
32
1
1
1 4.2
3. 1
10. 0
-
-
51
2.2
"
_
Plans
3
_
W ork
ers
54. 3
_
-
-
-
-
-
63
-
54. 3
1 Based on a study of 300 selected pension plans under collective bargaining covering approximately 4 ,6 7 0 ,0 0 0 w orkers,
of which 72 contained preparticipation requirem ents. (See table 3.)
2 1 plan provided a minimum requirem ent
of age 2 1 .
3 1 plan provided a minimum requirem ent
of age 40.
4 1 plan provided a minimum requirem ent
of age 2 5 for women.
5 This plan provided a minimum requirement of age 30 for
women.
6 Includes 1 plan that provided for alternatives of age 2 5 and 5 years of service , or age 35 and 1 year of service;
1 plan for 5 years of service or age 30 and 2 years of service; and 1 plan for age 35 and 5 years of service or if hired
after age 45, age 50 and */z year of service.
18
Table 5.
Preparticipation requirem ents not credited as service for computation
of basic norm al retirem ent benefit, fall 1959 1
(W orkers in thousands)
Minimum age requirem ents
All plans
Minimum service requirements
Num
ber
Plans with preparticipation require
ments not credited for computation of
basic norm al retirem ent benefit ______
No service requirement _________ ________
1 year of s e r v i c e ______ _________________
2 years of service _________________________
3 years of service _________________________
5 years of service _________________________
Alternatives _____ ____ _____________________
W orkers
59
555. 5
7
25
5
25.
240.
55.
130.
49.
54.
10
9
3
No age
requirement
W orkPlans
ers
29
_
6
7
3
19
2
1
6
4
3
3
“
25
35
30
W ork
ers
Plans
Plans
W ork
ers
Alternatives
W orkers
Plans
312. 8
8
44. 0
14
114. 9
5
29. 5
_
224. 0
1 6 .4
61. 7
10. 7
“
22
2
1
2
1
6. 0
8. 1
3
3
11. 5
9 .4
9. 0
42
2
5. 4
5. 5
1 7.4
59. 1
27. 5
32
1
1
14. 2
3. 1
10. 0
2. 2
~
4
“
51
-
-
"
Plans
3
_
-
-
63
W ork
ers
54. 3
_
-
54. 3
1 Based on a study of 300 selected pension plans under collective bargaining covering approximately 4, 670, 000 w orkers,
of which 72 contained preparticipation requirements . (See table 3. )
2 1 plan provided a minimum requirement of age 2 1 .
3 1 plan provided a minimum requirement of age 40.
4 Includes 1 plan covering 11, 800 workers that provides a minimum requirement of age 25 for women.
5 This plan provided a minimum requirement of age 30 for women.
6 Includes 1 plan that provided for alternatives of age 25 and 5 years
of service, or age 35 and 1year
of service;
1 plan for 5 years of service or age 30 and 2 years of service; and 1 plan
for age 35 and 5 years of service or if hired after
age 45, age 50 and l/z year of service.
Table 6 .
Minimum requirements for normal retirem ent in selected pension plans
under collective bargaining by method of financing, fall 1959
(W orkers in thousands)
Noncontributory
All plans
Minimum requirements 1
All plans studied __________________________
Age only 2 ____ ____________________________
Without preparticipation requirem ents:
Age 65 ____________ ____________________
With preparticipation requirem ents:
Age 6 5 ---------------------------------------- ---------Age and service _______ ____ ___________
Age 55 and 10 years __________________
Age 60 and 10 years __________________
Age 60 and 12 years ___ ___________
___
Age 60 and 15 years _______ ___
Age 60 and 20 years ______________ _
Age 65 and 2 years ____________________
Age 65 and 3 years ___________________
Age 65 and 5 years _______________ _ _
Age 65 and 10 years _____ __ _______
Age 65 and 12 years
______________
Age 65 and 15 years __________________
Age 65 and 18 years __________________
Age 65 and 20 years _______
______
Age 65 and 25 years ______________ _
Age 65 and 30 years ___________ _____
Age 70 and 20 years _________________
Age and p a rticip a tio n ___________________
Age 65 and 5 years ___________________
Age 65 and 10 years __________________
Age 65 and 15 years __________________
Alternatives ____________________________ —
Age 60 and 20 years or age
plus service equal 80 ______ _____
Age 65 and 10 years or age 60
and 30 years ____________________
Age 65 and 15 years or age 60
and 30 years ___ ____________________
Age 65 and 15 years or 30 years __
Age 65 or age 62 and 35 years ______
Contributory
W ork
ers
Num
ber
W ork
ers
Plans
W ork
ers
300
4 ,6 7 2 . 7
251
3 ,9 0 1 . 9
49
770. 8
72
644. 7
29
195. 1
43
449. 6
14
80. 2
Plans
7
36. 8
7
2
6
2
4
22
211
1
1
1
1
8
1
1
4
64
1
96
1
19
9
1
2
6
2
2
2
5
158. 3
3 ,5 8 3 . 9
3. 0
4. 0
2 .9
10. 0
471. 8
180. 0
3 0 .0
29. 0
1 ,2 4 9 .0
16. 2
1 ,0 4 7 .4
10. 0
376. 9
137. 8
7. 5
8 .4
29. 0
1 1.2
6. 6
1 1.2
93. 9
36
5
1
2
2
1
1
30. 2
1
30. 2
1
2 1 .0
1
2 1 .0
2
1
1
35. 0
7. 7
1. 5
2
1
35. 0
7. 7
58
216
1
1
1
1
8
1
2
4
64
1
98
1
21
9
1
2
6
2
2
2
6
564.
3 ,9 0 3 .
3.
4.
2.
10.
471.
180.
43.
5
6
0
0
9
0
8
0
9
29.0
1 ,2 4 9 . 0
16. 2
1 ,0 5 1 . 2
10. 0
678. 9
137. 8
7. 5
8 .4
29.0
11.
6.
11.
95.
"
1
4 3 .4
406. 2
319. 7
13. 9
3. 8
3 0 2 .0
1.5
"
1.5
1 Service refers to the period of employment, whereas participation includes period
of plan m em bership only. Periods may be identical or may vary if eligibility requirements
prior to m em bership in the plan are specified. (See table 4. ) Age requirem ents were lower
for women in a number of plans.
(See tabulation on p. 15.)
2 Of the plans in which age only is specified, 58 did not specify minimum service
other than that required for plan participation and 14 did not specify any minimum service
for eligibility.
19
Table 7.
Minimum age and service requirements for norm al retirem ent in selected pension plans
under collective bargaining, fall 1959
(W orkers in thousands)
Minimum age i•equirements 2
All plans
Minimum service requirem ents 1
Age 65
Age 60
Num
ber
W ork
ers
Plans
15
A ll plans studied
300
4 ,6 7 2 .7
No service requirement __ _____________________
1 year
.
. .
2 years _________ ________________________________
3 years
.........
......... . .....................
5 years
6 years
10 years __________________________________________
11 yea rs __________________________________________
12 years
15 years
18 years
20 years
25 yea rs
.................
30 years
35 years
18
25
7
13
16
2
67
1
2
101
1
32
9
5
1
89. 3
256. 3
239. 2
177.6
135. 2
11 .2
1 ,2 6 1 . 3
1. 3
19. 1
1 ,0 7 2 .4
10. 0
1 ,1 8 9 .3
137. 8
71. 2
1.5
W ork
ers
574. 9
_
_
-
-
-
-
1
1
1
4. 0
2 .9
10. 0
-
-
9
502. 0
-
-
3
56. 0
-
Othe r 3
W ork
ers
Plans
Plans
280
4 ,0 7 7 .2
5
18
25
7
13
16
2
65
1
1
100
1
21
9
1
89. 3
256. 3
239. 2
177. 6
135. 2
1 1.2
1 ,2 5 4 .3
1 .3
16. 2
1 ,0 6 2 .4
10. 0
678. 9
137. 8
7. 5
_
“
"
“
W ork
ers
20. 6
_
-
-
-
-
1
-
3. 0
-
-
-
-
-
-
2
8 .4
-
-
1
1
7. 7
1. 5
1 For those plans which specified a period of employment to be served before participation in the plan could begin, the
minimum service requirement includes the preparticipation service and the required plan m em bership service.
2 Some plans specified alternative requirem ents; for each case , the one with the earliest age or no age requirem ents
was selected.
Age requirem ents were lower for women in a number of plans.
(See tabulation on p. 4 .)
3 1 plan provided a minimum requirement of age 55, 2 plans for age 70, 1 plan for age 62, and 1 plan had no age
requirem ent with the specified credited service.
Table 8.
Provisions for basic and minimum benefits in selected pension plans under collective bargaining
by method of financing and type of bargaining unit, fall 1959
(W orkers in,thousands)
Method of financing
Type of bargaining
All plans
Provisions
Noncontributory
Num
ber
W orkers
Plans
W ork
ers
Contributory
Plans
W orkers
Single
employer
W ork
Plans
ers
M ulti
em ployer
W ork
Plans
ers
All plans studied _________________________
300
4 , 6 7 2 .7
251
3 ,9 0 1 .9
49
770. 8
231
2 ,9 4 6 . 4
69
1 ,7 2 6 .3
Plans with basic benefits only 1 _________
188
3 ,2 8 4 . 9
162
2, 823. 1
26
461. 8
122
1 ,5 8 2 . 1
66
1 ,7 0 2 .8
Plans with basic and minimum
benefits ________ ________________ ______
112
1 ,3 8 7 . 8
89
1 ,0 7 8 . 8
23
309. 0
109
1 ,3 6 4 .3
3
23. 5
_
1
Includes 149 plans providing
which must be m et to qualify for benefits.
a minimum inherent in the basic form ula by specifying minimum service
No specific minimum form ula was mentioned.
requirem ents
20
Table 9.
Types of basic benefit form ulas in selected pension plans under collective bargaining
by method of financing and type of bargaining unit, fall 1959
(W orkers in thousands)
Method of financing
Type of bargaining unit
A ll plans
Noncontributory
Type of basic benefit form ula
Num
ber
Contributory
W ork
ers
Plans
W ork
e rs
Plans
Single em ployer
Multiemploye r
W ork
ers
Plans
W ork
ers
Plans
W ork
ers
------------- ------------------------
300
4, 6 7 2 .7
251
3, 901. 9
49
77 0. 8
231
2, 9 4 6 .4
69
1 ,7 2 6 . 3
B enefits vary by earnings and s e r v i c e __
Benefits vary by service a lo n e ____ _____
Flat benefit for specified s e r v ic e ________
O th er1 - — — __ ------------- — __ -------- —
139
118
31
12
1, 619. 8
2, 07 0 .2
668. 8
313. 9
97
115
29
10
1, 169. 1
1 ,7 6 0 . 6
665. 8
3 0 6 .4
42
3
2
2
4 5 0 .7
309. 6
3. 0
7. 5
137
82
2
10
1, 5 77.7
1, 198. 1
3. 0
167.6
2
36
29
2
42.
872.
665.
146.
A ll plans studied
1 This includes plans in which various combinations of the classification s above were used.
Table 10.
Earnings base utilized in earnings and
service form ulas, fall 1959 1
(W orkers in thousands)
Earnings base
Plans
W ork
ers
A ll plans in which benefits vary with earnings
and s e r v ic e _______________________________________
139
1, 619. 8
Plans using earnings in all yea rs ______________
Each y ea r’ s earn in gs______________________ __
Total earnings __ ____________ _______________
Average earnings _____________________________
Plans using earnings in selected years
Last 10 y e a r s ’ earnings
High 10 consecutive y e a rs ’ earn in gs________
High 5 of last 10 y e a rs’ e a r n in g s ____________
Last 5 y e a rs’ earn in gs_____________________ __
High 5 consecutive yea rs' earnings
Othe r
___
. .
69
52
13
4
65
47
5
6
2
5
5
689. 6
497. 2
137.2
5 5 .2
920. 1
635. 9
73. 6
4 7 .4
6. 0
157.2
10. 1
1
Based on a study of 300 selected pension plans under collective
bargaining covering approximately 4, 67 0, 000 w orkers.
1
1
8
3
Table 11.
Percentage factor used in uniform percent formulas and reduction by prim ary social security benefit, by earnings computations utilized, fall 1959
(W orkers in thousands)
Plans utilizing earnings in selected years
Plans utilizing earnings in all years
Reduction and
percentage factor
All plans
5 highest
1 0 highest
5 highest of
Last 5 years consecutive
consecutive
last 1 0 years i
years
years
W ork
W ork
W orkWorkW ork
W ork
W ork
W ork
Work
W ork
Plansi
Plans
Plans
Plans
Plans
Plans
Plans
Plans
Planss
Plans
er s
ers
ers
ers
ers
ers
ers
ers
ers
ers
Each year's
earnings
Total
Num
ber
Work
ers
All plans with uniform
percentage __________________
88
1 ,1 3 1 .5
31
All prim ary social security
benefit deducted ____________
1 .0 0 percent ______________
1 . 33 p e rcen t____________
4
2
2
20. 8
6. 7
14. 1
-
O ne-half prim ary social s e
curity benefit deducted ____
1 .0 0 percent ______________
1 .2 0 p e rce n t______________
1 .5 0 percent ______________
1 .8 0 p e rce n t______________
2 .0 0 p e rcen t____________ _
12
8
1
1
1
1
$85 for
curity
1 .0 0
1 .25
1 .5 0
primary social s e
benefit d e d u cted ____
percent ______________
p e rce n t______________
percent ______________
No deduction for prim ary
social security ben efit_____
0 .4 0 percent ______________
0 .5 0 percent ______________
0 .5 5 percent ______________
0 .6 0 percent ______________
0 .7 0 p e rce n t______________
0 .7 5 p e rce n t______________
1 .0 0 percent ______________
1 .1 0 p e rce n t______________
1 .25 percent ______________
1 .5 0 percent ______________
2 .0 0 percent ______________
Othe r 4 ____________________
2 66.4
T otal
earnings
Last 10
years
Total
2
45. 1
57
865. 1
44
612. 0
4
-
-
-
-
-
-
20. 8
6. 7
14. 1
2
1
1
3 .9
1 .8
2. 1
-
-
4
2
2
4
1
1
1
21
18. 0
7. 7
3. 5
4. 2
2 .6
_
-
7
7
-
19 9 .0
1 99.0
-
1
1
-
9 .8
9 .8
-
-
-
3
3
-
59. 1
59. 1
-
1
1
8 .4
8 .4
40
40
-
6
1
_
2
2
1
"
60. 1
1
1
-
3 6 .7
3 6 .7
_
_
-
6
1
2
3
-
68. 0
_
1. 1
10. 9
56. 0
_
_
1
1
-
2 1 .0
_
2 1 .0
-
"
-
-
-
-
-
16
84. 1
13
_
_
-
_
-
-
-
-
219.9
2 06.7
3 .5
2 .9
4 .2
2 .6
5
1
1
1
1
1
20.9
7.7
3.5
2.9
4 .2
2. 6
1
_
1
_
2 .9
2 .9
_
-
-
44
40
3
1
644. 8
577. 3
59. 1
8 .4
4
3
1
67.5
59. 1
8.4
_
_
_
_
-
-
28
1
1
1
1
1
1
4
3
2
3
1
9
246. 0
3 6.7
5 .4
11.5
1. 1
1.5
1 .4
19.3
56. 0
7. 6
2 8 .4
2 1 .2
5 5.9
22
1
1
1
1
1
2
2
3
1
9
178. 0
36.7
5 .4
11.5
1.5
1.4
8.4
_
7.6
2 8.4
21.2
55.9
15
_
_
1
1
1
2
_
_
1
_
9
8 1 .2
11.5
1.5
1 .4
8 .4
2 .5
5 5 .9
Average
earnings.
1 37.2
5 .4
-
_
7. 6
2 5 .9
2 1 .2
~
-
-
"
-
577. 3 40
577. 3 "540
-
-
577. 3
577. 3
-
7 1 .0
2
1 8.9
2
6 .0
5
12. 0
12. 0
1
1
-
4 .9
4 .9
-
_
_
-
1
_
1
-
-
2
2
-
3 6 .0
36. 0
-
-
-
-
-
4
4
_
-
-
-
-
-
-
-
-
.
-
.
-
-
_
-
-
-
_
_
-
-
-
-
-
-
-
-
-
3 5 .0
3 5 .0
_
_
_
1
_
1
_
_
_
_
6 .9
_
6 .9
_
_
1
1
_
1.1
1.1
_
_
_
_
-
1
_
1
_
_
4. 0
_
4. 0
_
_
_
.
-
-
-
"
-
-
"
2
2
-
-
-
1 5 7 .2
1 5 3 .2
15 3 .2
-
-
1 Based on a study of 300 selected pension plans under collective bargaining covering approximately 4 ,6 7 0 ,0 0 0 w orkers.
2 This plan provided for a reduction of the lesser of one-half prim ary social security benefit or $52 if the worker
had 20 years or more of credited service;
or by all the prim ary social security benefit, if the worker had less than 20 years of credited service.
3 One plan provided for a reduction by $55 for prim ary social security benefit.
4 These are plans in which benefits were determined by an earnings table in which the ratio of benefits to earnings was not uniform through all earnings ranges.
22
Table 12.
Form ulas with 2 or m ore percentage factors by earnings at which
percentage factors change, fall 1 9 5 9 1
(W orkers in thousands)
Annual earnings at which percentage factor changes—
A ll plans
N um
ber
A ll plans with 2-percentage factors 3 ____
$ 3 , 600
$ 3 , 000
Percentage factors
W ork
ers
Plans
W ork
ers
Plans
W ork
ers
$ 4 , 200
Plans
Social security
taxable wage
base 2
W ork
W ork
Plans
ers
ers
$ 4 , 800
W ork
ers
Plans
46
4 7 8 .2
14
81. 6
5
35. 5
11
13 1 .3
2
11. 7
14
218. 1
1
1
1
1
2
1
1
3
8
11
2
2
1
2
1
1
5
1
1
7. 7
16. 0
20. 0
2. 6
9. 5
2 2 .0
1 .2
149.2
34. 0
9 4 .2
4 .4
1 5 .4
4. 8
16. 7
4 .2
1 .4
43. 7
15. 0
1 6 .2
_
1
1
1
1
_
3
4
1
_
1
_
_
1
_
_
2. 6
5. 5
2 2 .0
1 .2
_
1 2 .8
1 3 .0
1. 5
_
1 5 .0
_
_
8. 0
_
_
_
_
_
1
1
1
_
_
61
1
_
_
_
_
_
_
_
3. 1
6 .0
_
10. 0
_
_
1 .4
15. 0
1
1
_
_
_
_
2
41
2
1
1
1
_
1
_
-
1 6 .0
2 0 .0
_
_
_
3 3 .2
2. 8
4 2 .0
2. 9
5 .4
4 .8
4 .2
_
-
_
_
_
_
_
_
_
_
_
_
_
1
_
_
1
_
_
_
_
_
_
_
_
_
_
1. 7
_
_
1 0 .0
1
_
_
1
_
_
1
53
4
_
_
_
_
_
7. 7
_
_
_
4. 0
_
_
11 6 .0
15. 3
3 3 .2
_
_
_
_
_
25. 7
_
_
Percentage factors applicable to—
Lower level
of earnings
0. 50_ ......... ...................
0. 50 _ __ _____
0 .7 0 __________________
0. 7 5 ________
0. 75
_______ ___
0 .7 5 _______ ________
0. 75__ ______________
0 .8 0
__ _ ______
1 .0 0 __________________
1.00_ _____
___
1 . 2 0 _____ _______ _
1 .2 5 __________________
1 .2 5 __________________
1.3 0
____________
1 .3 0
______
1. 50 __ ____ _________
1 .5 0 __________________
____ _
1. 50 _______
2 .0 0
_ ______
Higher level
of earnings
1 .0 0 ________ ______
1. 50 ____
1 .4 0 ______________
0. 60 ____ .. _
1 .2 5 ____________
1 .5 0 ______________
1 .7 5 ______________
2. 0 0 _____
1 .5 0 ______________
2. 00__
2 .0 0 _____
1 .5 0 ______________
1 .7 5 ______ _______
2 . 0 0 ____
____
2. 80 _____________
1. 00 ____ . ____
2 .0 0 _____________
2. 50 .
1. 50 __ _ ____
_
_
-
73
.
81
_
1 6 .2
1 Based on a study of 300 selected pension plans under collective bargaining covering approximately 4, 670 ,0 0 0 w orkers.
2 The earnings at which the factor changes are automatically made equal to the m aximum taxable wage base which is
also the maxim um amount on which benefits are computed under social security.
3 Includes 2 plans covering 10, 500 workers with 3-percentage fa ctors.
The percentage factors applicable to earnings
of the 2 highest earnings levels and the amount of earnings dividing those levels are shown above.
4 This plan provided for application of the second percentage factor at $ 4 ,0 0 0 .
5 1 plan covering 1, 300 workers provided for reduction of plant benefit by $ 4 2 .5 0 for prim ary social security benefits.
6 This plan provided for a reduction of plan benefit by all prim ary social security benefits.
7 1 plan covering 7, 500 workers provided for reduction of plan benefit by one-half prim ary social security benefit.
8 This plan provided for a reduction of plan benefit by one-half prim ary social security benefit and application of the
second percentage factor at $ 5 ,0 0 0 .
23
Table 13.
Monthly benefits for each year of credited service and maximum years of service allowed by plans providing
a basic benefit varying by service, fall 1959 1
(W orkers in thousands)
Maximum years of credited service allowed—
Monthly benefit for each year
of credited service
A ll plans
1sJo
max mum
W ork
Plans
ers
Num
ber
W ork
ers
A ll plans in which benefits vary
by service -------------------------------------------------
118
2 ,0 7 0 .2
53
$ 1 .0 0
------- -----------------------------------------------$ 1 . 0 3 ----- ----------------------------------------------------$ 1 . 11 ----- ----------------------------------------------------$ 1 .2 5
---------------------------------------------------------$ 1 .4 0
---------------------------------------------------------$ 1 .5 0 ------------------------------------------------------------$ 1 .6 0
------- -----------------------------------------------$ 1 .7 5 ------------------------------------------------------------$ 1 .8 0 ------------------------------------------------------------$ 2 .0 0 -------------------------- -------------------------------$2. 08 -------------------------- -------------------------------$ 2 .2 5
---------------------------------- --------------------$ 2 .3 0 ------------------------------------------------------------$ 2 .4 0 ------------------------------------------------------------$ 2 .4 5 ------------------------------------------------------------$ 2 .5 0 ------------------------------------------------------------$ 3 .0 0 ------------------------------------------------------------$ 3 . 3 3 ----- ----------------------------- - --------------$3. 50 - -------------------------------------------------------$3. 60 ---------- -----------------------------------------------$ 4 . 00 ------- -------------------------------------------------$ 4 .2 6 ------------------------------------------ ---------------$ 4 .4 0
-------------------------------------------- ---------$ 4 .6 0
---------------------------------------------------------$ 4 .8 3
...........— ---------------------------------- ----$5. 00 ------------------------------------------------------------$5. 58 ------------------------------------------------------------$ 7 .5 0
---------------------------------------------------------Other -------------------------------------------------------------
3
1
1
3
2
4
2
3
1
10
1
12
1
1
1
39
1
6
1
1
1
1
2
1
1
2
1
1
14
16. 8
10. 0
1.2
29. 8
13. 3
14. 6
44. 0
10. 5
1 .8
207. 5
3. 0
1 8 1 .4
1 .6
3. 3
1 .9
875. 7
1. 5
209. 8
5. 0
2. 8
6. 8
1 .5
3. 3
7. 7
4. 6
46. 7
1 .2
6. 0
356. 9
1
1
1
1
1
3
4
1
35
1
-
_
-
74
20 years
Plans
1,125.2
3
8 .9
1 .2
3. 0
3. 3
3. 0
62. 0
145. 4
_
1 .9
862. 7
6. 8
.
1
-
-
27. 0
-
_
25 years
W ork
ers
46. 0
_
5. 0
-
-
-
1
1
35. 0
6. 0
■
Plans
W ork
ers
18
365. 4
1
1
2
4
1
1
1
1
1
_
31
42
1
1
-
1 .4
10. 0
44. 0
9 3 .2
_
3. 3
1 .5
180. 0
5. 0
2. 8
_
1 .5
3. 3
7. 7
1 1 .7
-
■
30 years
Plans
30
_
2
1
3
2
1
1
3
1
4
25
_
_
_
51
_
61
5
W ork
ers
458. 7
_
26. 8
10. 0
1 1 .3
7. 5
25. 0
3. 0
9. 1
1 .6
13. 0
29. 8
_
_
4. 6
_
1 .2
315. 8
35 or m ore
years
W ork
Plans
ers
14
7 4 .9
1
1
1
1
5
_
_
85
6. 5
3. 3
1 .8
2 2 .3
2 6 .9
_
14. 1
1 Based on a study of 300 selected pension plans under collective bargaining covering approximately 4, 670, 000 w orkers.
Includes 3 plans covering 5 ,4 0 0 workers which provided deduction of all prim ary social security benefit from
plan benefit.
3 This plan provided deduction of $85 for prim ary social security benefit from plan benefit.
4 These plans provided deduction of all prim ary social security benefit from plan benefit.
5 This plan provided for reduction of plan benefit by the prim ary social security benefit received by the worker as in
effect in 1957.
^ This plan provided for reduction of plan benefit by all prim ary social security benefit.
7 1 plan covering 1 7 ,0 0 0 workers provided for reduction of plan benefit by amount of social security the fam ily receives.
8 1 plan covering 1 ,2 0 0 workers provided for reduction of plan benefit by all prim ary social security benefit.
24
Table 14.
Plans providing a flat benefit for specified service
by monthly benefit amount, fall 1959 1
(W orkers in thousands)
Monthly benefit amount
W orkers
Plans
All plans providing flat benefits
668. 8
31
1
1
1
2
$20. 00 per month
$25. 00 per month _________________________ __ _
$30. 00 per month ___________ ________ __ ____
$35. 00 per month
.......
$40. 00 per month _______________________________
$ 4 2 .5 0 per month
$ 5 0 .0 0 per month
...........
.. . ___ ...
$60. 00 per month ..... .............. ..
$64. 00 per month ____ _____ _______________ _
$65. 00 per month _______________________________
$ 1 0 0 .0 0 per month ____________________________ _
$ 1 3 0 .0 0 per month ______ _____________________
Other _________ __________ __________________________
2. 3
16. 2
1. 5
7. 0
18 .4
76. 0
249. 1
2. 0
1. 0
68. 8
198. 0
1. 6
26. 9
3
1
11
1
1
2
2
1
24
1 Based on a study of 300 selected pension plans under c o l
lective bargaining covering approximately 4 ,6 7 0 ,0 0 0 w orkers.
2 3 plans provided a reduction of plan benefit by all prim ary
social security benefits.
Table 15.
Minimum benefit provisions by type of basic benefit form ula, fall 1959 1
Basic benefit form ula based. on—
Plans
Type of minimum benefit provision
Earnings
and
service
Service
alone
Flat
benefit
Other
All plans with m inimum benefit ________
112
102
7
2
1
Benefit varies by service alone ________
Flat benefit for specified service ______
Benefit varies by earnings and
service ........
Other
81
19
74
17
5
1
1
1
-
4
4
7
-
-
-
8
1
1
1
Based on a study of 300 selected pension plans under collective bargaining cov er
ing approximately 4 ,6 7 0 ,0 0 0 w orkers.
Table 16.
Provisions for deduction of prim ary social security benefit from minimum benefit
by method of financing, fall 1959*
(W orkers in thousands)
Noncontributory
All plans
Contributory
Provision
Plans
W orkers
All plans with minimum benefit p r o v is io n s ____
112
1 ,3 8 7 .8
89
107. 88
With deduction
_ .......
_ _ ........ .......... _
All prim ary social security benefit
deducted
_ . _
_
_ _ .........
One-half prim ary social security
benefit deducted
$85 for prim ary social security
benefit deducted
_
. ....
Other
.
__
_
..........
Without deduction _________________________________
28
3 1 1 .2
19
2 4 0 .4
17
105.0
10
5
158. 0
5
3
3
84
2 9 .4
18. 8
1 ,0 7 6 . 6
3
70
29. 4
4. 2
8 3 8 .4
14
1
Plans
W orkers
Number
1
W orkers
23
309. 0
9
70. 8
48. 8
7
56. 2
158. 0
_
2
_
_
14. 6
238. 2
Based on a study of 300 selected pension plans under collective bargaining covering approxim ately 4 ,6 7 0 ,0 0 0 w orkers.
25
Table 17.
N orm al retirem ent benefits, including m aximum prim ary social security benefit,
for selected earnings levels and years of future credited service
in selected pension plans under collective bargaining, fall 1 9 5 9 1
(W orkers in thousands)
Plans providing norm al retirem ent benefits to w orkers
with average annual earnings of:
$ 4 ,0 0 0 p e r y e a r
$ 4 , 800 p e r y e a r
$ 5 ,6 0 0 p e r y e a r
A m oun t o f m on th ly b e n e fit
20 y e a r s *
s e r v ic e
P la n s
30 y e a r s *
s e r v ic e
W ork er s
P la n s
20 y e a r s *
s e r v ic e
W ork
ers
300
4 ,6 7 2 . 7 300
4 ,6 7 2 . 7 300
U nder .15130 2
$130 and und er
$140 and u nd er
$150 and under
$160 and under
$170 and under
$180 and under
$190 and under
$200 and under
$210 and under
$220 and under
$230 and under
$240 and u nd er
$250 and u nd er
$2 75 and u nd er
$300 and under
$325 and under
$350 and o v e r _
21
14
30
42
107
29
13
17
7
15
2
176. 6
85. 1
576. 7
536. 5
1 ,9 5 2 .8
348. 9
259. 5
160. 8
66. 8
323. 2
33. 2
12. 2
20
_
34. 8
98. 1
8
240. 8
22
735. 0
30
597. 2 123
1 ,7 6 0 .8
11
12
1 7 5 .0
65. 7
19
473. 5
13
12
86. 8
13
89. 6
164. 3
9
7
117. 7
1
2 1 .2
$140
$ 1 5 0 _____________________
$160
$170
$180 .... .
$190 _____________________
$200
$210
$220 _
$230
__
$240 ...
$250
$275
$300
......... . ....
$325 _____________________
$350 _____________________
A v e ra g e m on th ly b e n e f i t 3 .
-
2
1
-
146. 6
6. 0
-
-
7
7
14
21
30
37
98
10
9
22
8
15
5
16
1
W ork
ers
P lan s
A ll plan s stu died ............ _ ................
1 6 4 .6
-
-
_
_
_
-
-
-
-
-
-
_
_
$187. 50
6
_
43. 3
449 . 7
4 1 1 .2
2 ,1 7 8 . 3
34. 1
221. 5
419 . 5
100. 9
304. 7
6 4 .6
58. 5
215. 8
6. 0
-
-
P la n s
4 ,6 7 2 . 7 300
-
$ 16 7. 44
_
30 y e a r s '
s e r v ic e
W orker s
$18 4. 92
P la n s
4 ,6 7 2 . 7 300
1 1 .2
_
4
7
23
28
22
25
91
10
13
4
17
19
16
13
2
-
20 y e a r s *
s e r v ic e
_
6. 0
45. 5
259. 6
665. 2
3 5 6 .4
318. 8
1 ,7 6 2 .5
46 . 7
5 0 9 .4
27. 1
1 2 6 .4
323. 9
83. 7
94. 1
36. 2
-
$ 2 0 6 .7 6
20
_
7
21
26
120
11
12
11
5
13
13
10
25
5
1
30 y e a r s *
s e r v ic e
W ork
ers
P la n s
W ork
ers
4 ,6 7 2 . 7 300
4 ,6 7 2 . 7
5
_
5
7
20
28
15
20
98
9
8
6
9
16
19
11
19
5
9 .4
_
7. 8
45. 5
208. 8
642. 7
160. 2
2 6 5 .6
1,960. 8
79. 3
360. 9
79. 1
6 5 .6
338. 1
1 9 1 .0
91. 9
106. 2
59. 8
16 4 .6
_
31. 3
446 . 2
309. 3
2 ,1 1 0 . 1
122. 3
1 5 5 .0
3 3 0 .6
138. 1
343. 8
9 3 .9
79. 1
273. 2
69. 2
6. 0
_
-
-
-
$18 8. 87
$ 2 1 3 .8 3
1 B en efit am ou n ts a r e b a s e d on futu re s e r v ic e fo r m u la s , a s s u m in g a con stan t le v e l o f e a r n in g s and m on th ly p r im a r y
s o c ia l s e c u r it y b e n e fits o f $112 fo r w o r k e r s e a rn in g $ 4 ,0 0 0 p e r y e a r , and $127 f o r w o r k e r s ea rn in g $ 4 ,8 0 0 and $ 5 ,6 0 0 p e r y e a r .
In clu d es plan s in w h ich no p e n s io n fr o m the plan w a s p r o v id e d b e c a u s e m o r e than 20 y e a r s o f s e r v ic e w as r e q u ir e d
to q u a lify f o r b e n e fits , o r b e c a u s e o f d e d u ctio n o f p r im a r y s o c ia l s e c u r it y b e n e fit.
3
A r ith m e tic m e a n o f n o r m a l r e t ir e m e n t b e n e fits , in clu d in g p r im a r y s o c ia l s e c u r it y b e n e fits , w e ig h te d by n u m b e r o f
w ork ers covered .
00
o
o
per yea r
-ee-
o
o
o
Table 18.
Average 1 norm al retirem ent benefits and their relationship to selected
earnings levels 2 in selected pension plans under collective bargaining, fall 1959 3
per year
$ 5 , 600 p e r y e a r
20 y e a r s 1 30 y e a r s 1 20 y e a r s 1 30 y e a r s * 20 y e a r s 1 30 y e a r s 1
s e r v ic e
s e r v ic e
s e r v ic e
s e r v ic e
s e r v ic e
s e r v ic e
In clu din g p r im a r y s o c ia l
s e c u r it y b e n e fit:
M onthly a m o u n t ---------------------P e r c e n t o f e a rn in g s l e v e l -----
$ 1 6 7 . 44
50. 23
$18 7. 50
5 6 .2 5
$ 1 8 4 . 92
4 6 .2 3
$20 6. 76
51. 69
$ 1 8 8 .8 7
4 0 .4 7
$2 1 3 . 83
45. 68
E x clu d in g p r im a r y s o c ia l
s e c u r it y b e n e fit:
M onthly a m o u n t ---------------------P e r c e n t o f e a rn in g s l e v e l -----
55. 44
16. 63
75. 50
22. 65
5 7 .9 2
14. 48
79. 76
1 9 .9 4
6 1 .8 7
1 3 .2 6
86. 83
18. 61
1 A r it h m e t ic m e a n o f plan b e n e fits w eigh ted b y n u m b e r o f w o r k e r s c o v e r e d .
2 C om p u ta tion o f b e n e fit am ounts is b a s e d on fu tu re s e r v ic e fo r m u la s , a s s u m in g a
con sta n t le v e l o f e a rn in g s and m o n th ly p r im a r y s o c ia l s e c u r it y b e n e fits o f $112 f o r w o r k e r s
e a rn in g $ 4 ,0 0 0 a y e a r , and $12 7 f o r w o r k e r s e a rn in g $ 4 ,8 0 0 and $ 5 ,6 0 0 a y e a r .
3 B a s e d on a study o f 300 s e le c t e d p e n s io n plan s under c o ll e c t iv e l y b a rg a in in g c o v e r in g
a p p r o x im a te ly 4, 670, 000 w o r k e r s .
26
T a b le 19.
N o r m a l r e t ir e m e n t b e n e fits , e x clu d in g p r im a r y s o c ia l s e c u r it y b e n e fit, f o r s e le c t e d e a rn in g s le v e ls and y e a r s
o f fu tu re c r e d it e d s e r v ic e in s e le c t e d p e n s io n plans u n d er c o ll e c t iv e b a r g a in in g , fa ll 1959 1
(W o r k e r s in th ou san d s)
P la n s p r o v id in g n o r m a l r e t ir e m e n t b e n e fits to w o r k e r s
20 y e a r s '
se r v ic e
W orkers
$ 5 , 600 p e r y e a r
$ 4 , 800 p e r y e a r
$ 4 , 000 p e r y e a r
A m ou n t o f m on th ly b e n e fit
30 y e a r s '
s e r v ic e
W ork
P lan s
ers
30 y e a r s '
s e i•vice
W ork
P la n s
ers
20 y e a r s '
s e r v ic e
W ork
P la n s
ers
30 y e a r s '
s e r v ic e
W ork
P lan s
ers
20 y e a r s '
s e r v ic e
W ork
P lan s
ers
A ll plans stu died ----------------------------------------
300
4 ,6 7 2 .7
300
4,6 7 2 . 7
300
4 ,6 7 2 .7
300
4,672 . 7
300
4 ,6 7 2 .7
300
4 ,6 7 2 .7
N one 2 _______________________________________
$1 and u n d er $ 2 0 ---------------------------------------$20 and u n d er $ 3 0 ------------------------------------$30 and u n d er $40 ------------------------------------$40 and u n d er $50 ------------------------------------$50 and u n d er $60 ------------------------------------$60 and u n d er $7 0 ------------------------------------$70 and u n d er $80 ------------------------------------$80 and u n d er $90 ------------------------------------$90 and u n d er $ 1 0 0 ----------------------------------$ 10 0 and u n d er $12 5 --------------------------------$12 5 and u n d er $150 --------------------------------$ 15 0 and u n d er $175 --------------------------------$175 and u n d er $200 --------------------------------$2 00 and o v e r -------------------------------------- r-----
19
2
16
29
44
108
26
13
17
8
15
2
1
1 6 3 .4
1 3 .2
98. 4
564. 7
541. 7
2 ,0 7 4 . 8
223 . 3
260 . 6
166. 8
7 3 .2
340. 0
146. 6
6. 0
-
6
2
6
14
20
33
38
96
9
8
35
22
11
1 1 .2
2. 5
3 3 .2
1 0 8 .9
2 2 8 .8
858. 0
4 9 2 .2
1 ,7 4 8 .6
172. 3
62. 6
598. 1
253. 0
103. 3
20
16
26
40
108
13
10
16
14
29
7
1
164. 6
6
2
5
14
18
32
36
91
6
12
29
17
17
13
2
1 1 .2
2 .2
3 1 .4
74. 3
22 2 . 7
8 2 4 .2
493 . 6
1 ,7 5 9 .3
15. 3
187. 7
534. 9
3 0 0 .4
8 5 .2
94. 1
3 6 .2
20
1 0 6 .9
515. 1
497. 4
1,984. 1
222 . 7
265 . 7
200 . 3
121. 3
372. 8
215. 8
6. 0
164. 6
93. 6
457. 3
446. 1
2 ,0 1 8 . 7
76. 0
3 0 1 .3
1 2 3 .4
1 5 3 .4
4 8 9 .9
2 7 3 .2
75. 2
-
5
3
5
12
18
27
28
95
8
7
23
15
20
10
24
9 .4
4. 0
3 1 .4
6 0 .2
222 . 7
615. 1
389. 8
1,864. 0
112. 3
72. 7
505. 3
3 3 6 .9
193. 0
8 9 .9
16 6 . 0
-
-
$ 5 5 . 44
A v e r a g e m on th ly b e n e fit 3 ------------------------
-
-
-
-
-
-
-
-
-
$57 . 92
$75 . 50
$79 . 76
-
14
25
36
108
9
13
5
7
32
25
6
-
-
$61 . 87
$816 . 83
1 B e n e fit am ounts a r e b a s e d on fu tu re s e r v ic e fo r m u la s , a s s u m in g a co n sta n t le v e l o f e a r n in g s , and m on th ly p r im a r y s o c ia l
s e c u r it y b e n e fits o f $112 f o r w o r k e r s ea rn in g $ 4 ,0 0 0 p e r y e a r , and $ 12 7 f o r w o r k e r s e a rn in g $ 4 ,8 0 0 and $ 5 ,6 0 0 p e r y e a r .
2 T h e se a r e plans in w h ich no p e n s io n fr o m the plan w as p r o v id e d b e c a u s e m o r e than 20 y e a r s o f s e r v ic e w as r e q u ir e d
to q u a lify f o r b e n e fit s , o r b e c a u s e o f the d ed u ctio n o f p r im a r y s o c ia l s e c u r it y b e n e fits .
3 A r it h m e t ic m e a n o f n o r m a l r e t ir e m e n t b e n e fits w eigh ted b y n u m b er o f w o r k e r s c o v e r e d .
T a b le 2 0 . N o rm a l r e t ir e m e n t b e n e fits , in clu d in g m a x im u m p r im a r y s o c ia l s e c u r it y b e n e fit, fo r w o r k e r s earn in g
$ 5 ,6 0 0 per y e a r fo r 30 y e a r s o f fu ture c r e d it e d s e r v ic e by type o f b a rg a in in g unit and m e th o d o f fin a n cin g
in s e le c t e d p en sion plans under c o ll e c t iv e b a rg a in in g , fa ll 1959 1
S ingle e m p lo y e r
M u ltie m p lo y e r
A ll plans
A m oun t o f m o n th ly b en efit
A ll plans
N um
be r
W ork
er s
N o n c o n trib u to r y
N um
ber
W ork
er s
P lans
W ork
er s
A ll plans stu d ied ___________________________
300
4 ,6 7 2 . V
231
2 ,9 4 6 .4
184
2 ,4 8 2 .4
U nder $ 1 3 0 3 ________________________________
$130 and under $ 1 4 0 ____________________ _
$ 1 4 0 and u nd er $150 _
$150 and under $ 1 6 0 ______________________
$160 and under $ 1 7 0 ______________________
$170 and under $180 _____________________
$180 and under $ 1 9 0 ________________ ____
$190 and under $200 ______________________
$200 and under $210 _________________ _____
$210 and under $220 ______________________
$220 and under $230
$230 and under $240 ______________________
$240 and under $2 50 ______________________
$2 50 and under $2 75 ______________________
$27 5 and under $300
... .. .
$300 and under $32 5 ______________________
$32 5 and under $3 50
$350 and o v e r ______________________________
5
_
5
7
20
28
15
20
98
9
8
6
9
16
19
11
19
5
9 .4
_
7 .8
4 5 .5
2 0 8 .8
6 4 2 .7
1 6 0 .2
2 6 5 .6
1 ,9 6 0 .8
7 9 .3
3 6 0 .9
79. 1
6 5 .6
3 3 8 .1
1 9 1 .0
9 1 .9
1 0 6 .2
5 9 .8
5
_
4
2
7
10
10
15
93
6
1
5
7
13
18
11
19
5
9 .4
_
5. 5
2 .4
39. 9
3 9 .5
8 9 .9
185. 3
1 ,7 6 6 .6
6 3 .5
1 .5
69. 1
51. 1
1 7 9 .8
1 8 5 .0
9 1 .9
1 0 6 .2
5 9 .8
5
_
4
2
7
10
9
14
92
6
1
2
7
10
5
5
4
1
9 .4
_
5. 5
2 .4
3 9 .9
3 9 .5
8 7 .9
1 8 4 .3
1 ,7 6 3 .8
6 3 .5
1 .5
6 0 .9
51. 1
44. 6
8 4 .0
2 7 .3
1 4 .2
2 .6
C o n tr ib u to r y
P lan s
A ll plans 2
W ork
ers
N um
ber
W ork
ers
47
4 6 4 .0
69
1 ,7 2 6 .3
_
_
_
_
_
1
1
1
_
_
_
_
_
_
2 .0
1 .0
2 .8
_
1
5
13
18
5
5
5
3
7
1
2
3
1
_
_
2 .3
43. 1
1 6 8 .9
6 0 3 .2
7 0 .3
8 0 .3
1 9 4 .2
1 5 .8
3 5 9 .4
1 0 .0
14. 5
1 5 8 .3
6 .0
_
3
_
3
13
6
15
4
_
_
8 .2
_
135 .2
1 0 1 .0
6 4 .6
9 2 .0
5 7 .2
_____
_
_
,
1 B en efit am ounts a r e b a s e d on futu re s e r v ic e fo r m u la s , a ssu m in g a con stan t l e v e l o f e a r n in g s and m on th ly p r im a r y s o c ia l
s e c u r it y b e n e fits o f $ 1 2 7 .
W ith 2 e x c e p tio n s , th e s e plans w e r e n o n c o n tr ib u to r y .
In clu d es plans in w h ic h no p e n sio n f r o m the plan w as p r o v id e d b e c a u s e o f the d e d u ctio n o f p r im a r y s o c ia l s e c u r it y b e n e fits .
27
T a b le 2 1 . N o rm a l r e t ir e m e n t b e n e fits , in clu d in g m a x im u m p r im a r y s o c ia l s e c u r it y b e n e fit, fo r w o r k e r s earning
$ 4 ,0 0 0 per y e a r fo r 30 y e a r s o f fu ture c r e d it e d s e r v ic e by type o f b a rg a in in g unit and m e th o d o f fin a n cin g
in s e le c t e d p en sion plans under c o ll e c t iv e b a r g a in in g , fa ll 1959 1
(W o r k e r s in th ou san d s)
S ingle e m p lo y e r
M u ltie m p lo y e r
A ll plans
A ll plans
A m oun t o f m o n th ly b e n e fit
A ll plans stu d ied ___________________________
U nder $130 3 . . .
$130 and under
$140 and under
$ 150 and under
$160 and under
$170 and under
$180 and under
$190 and under
$200 and under
$210 and under
$220 and under
$230 and under
$240 and under
$2 50 and under
$2 75 and under
$140
$150
$160
$170
$180
$190
$200
$210
$220
$230
$240
$250
$275
$300
______________________
___________ ____ _______
______________________
______________________
______________________
______________________
______ ______ ________
______________________
______________________
______________________
______________________
________ ______________
______________________
______________________
N o n c o n trib u to r y
C o n tr ib u to r y
N um
ber
W ork
er s
N um
be r
W ork
er s
P lans
W ork
er s
P lans
300
4 ,6 7 2 . 7
231
2 ,9 4 6 .4
184
2 ,4 8 2 . 4
47
7
7
14
21
30
37
98
10
9
22
8
15
5
16
1
1 2 .2
3 4 .8
98 . 1
2 4 0 .8
7 3 5 .0
5 9 7 .2
1 ,7 6 0 .8
1 7 5 .0
6 5 .7
4 7 3 .5
8 6 .8
8 9 .6
1 6 4 .3
1 1 7 .7
2 1 .2
7
4
7
9
13
29
94
8
7
15
7
12
3
15
1
1 2 .2
6 .3
3 6 .3
76. 1
1 6 5 .8
4 5 6 .0
1 ,5 6 7 .9
1 6 6 .0
5 4 .9
114. 1
79. 1
6 1 .1
1 7 .7
1 1 1 .7
2 1 .2
7
3
7
9
13
26
92
4
4
6
4
7
1 2 .2
5 .0
3 6 .3
76. 1
1 6 5 .8
4 4 7 .4
1 ,5 6 5 .3
1 4 .0
1 4 .8
3 2 .1
7 2 .2
36. 1
1
-
-
2
5. 1
-
3
2
4
3
9
3
5
3
13
1
W ork
ers
A ll plans 2
N um
ber
W ork
er s
4 6 4 .0
69
1 ,7 2 6 .3
.
1 .3
_
3
7
12
17
8
4
2
2
7
1
3
2
1
2 8 .5
6 1 .8
1 6 4 .7
5 6 9 .2
1 4 1 .2
1 9 2 .9
9 .0
1 0 .8
3 5 9 .4
7 .7
2 8 .5
1 4 6 .6
6 .0
-
8 .6
2 .6
1 5 2 .0
4 0 .1
8 2 .0
6 .9
2 5 .0
1 7 .7
1 0 6 .6
2 1 .2
1 B en efit am ou n ts a r e b a s e d on fu tu re s e r v ic e fo r m u la s , a s s u m in g a co n s ta n t l e v e l o f e a rn in g s and m on th ly p r im a r y
s o c ia l s e c u r it y b e n e fits o f $ 1 1 2 .
2 W ith 2 e x c e p t io n s , th e s e plans w e r e n o n c o n tr ib u to r y .
3 In clu d es plans in w h ich n o p e n s io n f r o m the plan w as p r o v id e d b e c a u s e m o r e than 20 y e a r s o f s e r v ic e w as r e q u ir e d
to q u a lify fo r b e n e fits , o r b e c a u s e o f the d e d u ctio n o f p r im a r y s o c ia l s e c u r it y b e n e fits .
T a b le 2 2 . N o rm a l r e t ir e m e n t b e n e fits , in clu d in g m a x im u m p r im a r y s o c ia l s e c u r it y
b e n e fit, f o r w o r k e r s ea rn in g $ 5 ,6 0 0 per y e a r fo r 30 y e a r s o f fu tu re c r e d it e d
s e r v ic e by type o f b e n e fit fo r m u la u se d to co m p u te b e n e fits in s e le c t e d
p e n sio n plans under c o ll e c t iv e b a r g a in in g , fa ll 1959 1
( W o r k e r s in th ou san d s)
T yp e o f fo rm u la
A ll plans
A m oun t o f m on th ly b e n e fit
S e r v ic e on ly
N um
b er
A ll plans stu d ie d
U nder $130 4
$ 130 and under
$140 and under
$150 and under
$160 and under
$ 170 and under
$180 and under
$ 190 and under
$200 and under
$210 and under
$220 and under
$230 and under
$240 and under
$250 and under
$27 5 and under
$300 and under
$32 5 and under
$350 and o v e r
_________________________
$140
$150
$160
$170
$180
$190
$200
$210
$220
$230
$240
$2 50
$275
$300
$325
$350
______________________
______________________
______________________
______________________
______________________
______________________
______________________
______________________
______________________
______________________
______________________
______________________
______________________
______________________
______________________
______________________
W ork
ers
P la n s
W ork
ers
S e r v ic e
and e a rn in g s
W ork
P lan s
er s
2 300
4 , 6 7 2 .7
3 193
3 .3 5 0 . 4
95
1 ,0 0 8 .4
5
9 .4
7 .8
45. 5
2 0 8 .8
6 4 2 .7
1 6 0 .2
265. 6
1 ,9 6 0 .8
7 9 .3
3 6 0 .9
79. 1
65. 6
3 3 8 .1
1 9 1 .0
9 1 .9
1 0 6 .2
5 9 .8
4
_
4
7
18
25
12
18
86
5
7
1
2
3
1
7 .7
1
1
_
_
2
3
2
9
4
1
4
5
12
17
11
18
5
1 .7
_
1 .8
_
_
3 8 .9
23. 1
7 .4
216. 1
4 7 .2
1 .5
1 1 .7
4 8 .1
1 7 5 .5
1 8 1 .9
9 1 .9
1 0 1 .8
5 9 .8
_
5
7
20
28
15
20
98
9
8
6
9
16
19
11
19
5
_
_
_
6 .0
45 . 5
204. 5
6 0 0 .8
1 3 7 .1
2 5 8 .2
1 ,6 5 1 .0
3 2 .1
3 5 9 .4
1 0 .0
14. 5
1 7 .6
6 .0
_
_
1 B en efit am ou n ts a r e b a s e d on fu tu re s e r v ic e f o r m u la s , a s s u m in g a con stan t le v e l
o f e a rn in g s and m on th ly p r im a r y s o c ia l s e c u r it y b e n e fits o f $ 1 2 7 .
2 In clu d e s 12 plans c o v e r in g 3 1 3 ,9 0 0 w o r k e r s w h ich can n ot be c la s s i f ie d in e ith e r type
o f b e n e fit fo r m u la .
3 In clu d e s plans w ith a b a s ic b e n e fit fo r m u la w h ich v a r i e s w ith e a rn in g s and s e r v ic e
but a m in im u m p r o v id e d by the plans b a s e d on s e r v ic e w as a p p lic a b le to th o se w o r k e r s w ith
30 y e a r s ' s e r v ic e and e a rn in g s o f $ 5 ,6 0 0 per y e a r .
4 In clu d e s plans in w h ich no p e n sio n f r o m the plan w as p r o v id e d b e c a u s e o f the d e
d u ctio n o f p r im a r y s o c ia l s e c u r it y b e n e fits .
28
T a b le 23. N o rm a l r e t ir e m e n t b e n e fits , in clu d in g m a x im u m p r im a r y s o c ia l s e c u r it y b e n e fit, f o r w o r k e r s
e a rn in g $ 4 ,0 0 0 p e r y e a r f o r 30 y e a r s o f fu tu re c r e d it e d s e r v ic e by type o f b e n e fit fo r m u la u s e d to
co m p u te b e n e fits in s e le c t e d p e n s io n plans u nd er c o ll e c t iv e b a r g a in in g , fa ll 1959 1
(W o r k e r s in th ou san d s)
T yp e o f fo r m u la
A m oun t o f m on th ly b e n e fit
A ll plans
N u m ber
A ll plans s t u d ie d ____________ —
— ----------
__
U n der $130 4 _____________________________________
$ 13 0 and und er $ 1 4 0 ____________________________
$ 14 0 and u n d er $ 1 5 0 ____ _ _
__
___
$15 0 and voider $ 160_
„
_____
___
$ 160 and voider $ 170__ ----------__ __
________
$ 17 0 and und er $ 180_ ___ __ __
$ 1 8 0 and voider $ 1 9 0 ____________________________
$ 19 0 and un d er $ 2 0 0 __ ___
___
__ __
$20 0 and voider $210 _ ______
__________
$ 21 0 and voider $220 _ ___
__ ______
$ 2 2 0 and voider $ 2 3 0 ____
________
___
$ 23 0 and voider $ 2 4 0 __ ___ ___
___
______
$ 24 0 and voider $250_ _____ ___
__
___
$25 0 and voider $ 2 7 5 __ ___ _____ __
__ __
___ __
$ 2 7 5 and u nd er $300_
__
__
S e r v ic e o n ly
W ork ers
S e r v ic e and e a rn in g s
P la n s
W orkers
P la n s
W orkers
2300
4 ,6 7 2 .7
3 202
3, 470. 7
86
888. 1
7
7
14
21
30
37
98
10
9
22
8
15
5
16
1
1 2 .2
3 4 .8
98. 1
2 4 0 .8
7 3 5 .0
5 9 7 .2
1, 760. 8
1 7 5 .0
65. 7
473. 5
86. 8
89. 6
1 6 4 .3
117. 7
2 1 .2
5
5
11
18
23
27
92
3
3
9
1
3
1
1
8 .7
3 1 .4
57. 1
2 0 6 .6
5 9 0 .3
4 1 2 .2
1 ,7 3 0 .8
11. 8
12. 1
365. 9
7. 7
28. 5
1 .6
6 .0
2
2
1
2
4
8
6
6
6
13
6
11
3
15
1
3 .5
3 .4
36. 7
3 1 .2
2 6 .8
1 5 0 .6
3 0 .0
1 6 1 .4
53. 6
107. 6
7 6 .0
5 6 .7
17. 7
111. 7
2 1 .2
1 B e n e fit am ounts a re b a s e d on futu re s e r v ic e fo r m u la s , a s s u m in g a co n s ta n t le v e l o f e a r n in g s and m on th ly p r im a r y
s o c ia l s e c u r it y b e n e fits o f $ 1 1 2 .
2 In clu d es 12 p la n s , c o v e r in g 313, 900 w o r k e r s , w h ich ca n n o t be c la s s i f ie d in e ith e r type o f b e n e fit fo r m u la
3 In clu d es plans w ith a b a s ic b e n e fit fo r m u la w h ich v a r ie s w ith e a rn in g s and s e r v ic e but a m in im u m p r o v id e d by the
plans b a s e d on s e r v ic e w as a p p lic a b le to th ose w o r k e r s w ith 30 y e a r s ' s e r v ic e and e a r n in g s o f $ 4 ,0 0 0 p e r y e a r .
4 In clu d es plans in w hich no p e n s io n f r o m the plan w as p r o v id e d b e c a u s e o f the d e d u ctio n o f p r im a r y s o c ia l s e c u r it y
b e n e fits .
29
Early and Disability Retirement
N e a r l y n in e - t e n t h s o f the 300 c o l l e c t i v e l y b a r g a i n e d p e n s i o n p la n s a n a
l y z e d b y th e B u r e a u o f L a b o r S t a t i s t ic s in th e f a l l o f 1959 p e r m i t t e d r e t i r e m e n t
b e f o r e the n o r m a l r e t i r e m e n t a g e on an i m m e d i a t e p e n s i o n u n d e r e a r l y o r d i s a
b il it y r e t i r e m e n t p r o v i s i o n s . T h r e e - f o u r t h s o f the p la n s h a d n o a g e r e q u ir e m e n t s
f o r d i s a b i l i t y r e t i r e m e n t , an d the a g e r e q u i r e m e n t s f o r e a r l y r e t i r e m e n t w e r e
u s u a l l y 5 t o 15 y e a r s l o w e r t h a n f o r n o r m a l r e t i r e m e n t .
The s e rv ice r e q u ir e
m e n t s f o r b o th ty p e s o f p r e n o r m a l r e t i r e m e n t w e r e g e n e r a l l y the s a m e as o r
s o m e w h a t lo n g e r than th o s e f o r n o r m a l r e t ir e m e n t .
U n d er m o s t p la n s, total
b e n e fits (in clu d in g s o c ia l s e c u r ity ) f o r to ta lly and p e r m a n e n tly d is a b le d w o r k e r s
w e r e at the s a m e l e v e l as n o r m a l r e t i r e m e n t b e n e f it s f o r w o r k e r s w ith e q u iv a le n t
e a r n in g s and s e r v i c e .
E a r l y r e t i r e m e n t b e n e f i t s , o n th e o t h e r h a n d , w e r e a l m o s t
i n v a r i a b l y l o w e r , r e f l e c t i n g , a m o n g o t h e r t h in g s , the l o n g e r a v e r a g e p e r i o d o v e r
w h ich b e n e fits w ou ld b e p a id .
A n e a r l y r e t i r e m e n t p r o v i s i o n , a s th e t e r m is u s e d in th is s tu d y , p e r
m it s w o r k e r s m e e t in g c e r t a in a g e o r s e r v i c e r e q u ir e m e n t s o r b o th to r e t i r e b e
f o r e r e a c h in g th e ir p la n 's n o r m a l r e t ir e m e n t a ge and r e c e iv e im m e d ia te b e n e fit s .
A f e w p la n s a l s o p e r m i t th e e m p l o y e r to r e q u i r e the w o r k e r 's r e t i r e m e n t o n an
im m e d ia te b e n e fit.
A lth o u g h e a r ly r e t ir e m e n t b e n e fits a r e a lw a y s p a y a b le i m
m e d i a t e l y o n r e t i r e m e n t , u n d e r s o m e p la n s the w o r k e r m a y c h o o s e to d e f e r r e
c e i v i n g a r e g u l a r e a r l y r e t i r e m e n t b e n e fit u n til h e a tta in s the n o r m a l r e t i r e
m ent age.
' ’S p e c i a l " e a r l y r e t i r e m e n t p r o v i s i o n s r e c e n t l y a d d e d t o m a n y p l a n s i n
the a u t o m o b i le an d r u b b e r m a n u fa c t u r in g i n d u s t r ie s a l l o w the e m p l o y e r to c o m p e l
e a r l y r e t i r e m e n t , b u t in r e c o g n i t i o n o f the in v o lu n t a r y a s p e c t o f th e w o r k e r ' s r e
t i r e m e n t , t h e s e p la n s p r o v i d e d m o r e than t w ic e the b e n e fit p a y a b le to t h o s e r e
t i r in g v o l u n t a r i l y u n d e r th e r e g u l a r e a r l y r e t i r e m e n t p r o v i s i o n s .
A d i s a b i l i t y r e t i r e m e n t p r o v i s i o n , o n th e o t h e r h a n d , r e q u i r e s th at the
w o r k e r b e t o t a l l y a n d p e r m a n e n t l y d i s a b l e d in a d d it i o n to m e e t i n g a g e o r s e r v i c e
r e q u i r e m e n t s o r b o t h . It m a k e s b e n e f i t s p a y a b l e i m m e d i a t e l y , u s u a l l y f o l l o w i n g a
s h o r t w a itin g p e r io d — m o s t fr e q u e n t ly 6 m o n th s . T h e d e fin itio n o f to ta l and p e r
m a n e n t d i s a b i l i t y an d its a p p l i c a t i o n v a r i e d c o n s i d e r a b l y a m o n g th e p la n s s t u d ie d .
U n d e r t h e 1 95 6 a m e n d m e n t s t o t h e . S o c i a l S e c u r i t y A c t , t o t a l l y a n d p e r m a n e n t l y
d i s a b l e d w o r k e r s b e t w e e n t h e a g e s o f 5 0 a n d 65 w h o h a d w o r k e d u n d e r t h e a c t
f o r t h e r e q u i r e d l e n g t h o f t i m e b e c a m e e l i g i b l e f o r d i s a b i l i t y b e n e f i t s . 21
The
w a y s in w h i c h t h e s e b e n e f i t s w e r e ta k e n in to a c c o u n t in p r i v a t e p e n s i o n p la n s a r e
d i s c u s s e d in th is s tu d y . H o w e v e r , d e d u c t io n s f o r w o r k m e n 's c o m p e n s a t i o n p a y
m e n ts u n d e r s o m e p r iv a te p e n s io n p la n s w e r e not c o n s id e r e d .
Scope
o f S tu dy
F o r th is s tu d y , 3 00 s e l e c t e d p e n s i o n p la n s u n d e r c o l l e c t i v e b a r g a in in g in
e f f e c t in th e f a l l o f 1959 w e r e a n a l y z e d . T h e s e p la n s — th e s a m e p la n s u s e d in th e
stu d y o f n o r m a l r e t i r e m e n t p r o v i s i o n s — c o v e r e d a p p r o x im a t e ly 4 .7 m i l l i o n w o r k e r s ,
o r a b o u t h a l f o f t h e e s t i m a t e d c o v e r a g e o f a l l c o l l e c t i v e l y b a r g a i n e d p e n s i o n p l a n s . 22
21 T h e I 9 6 0 a m e n d m e n t s r e m o v e d t h e m i n i m u m a g e r e q u i r e m e n t , s o t h a t
a f t e r O c t o b e r 31 , I9 6 0 , q u a lif ie d w o r k e r s m a y r e c e i v e d i s a b i l i t y b e n e f it s at a n y
a g e up to 65.
22 F o r a d d i t i o n a l i n f o r m a t i o n o f t h e s c o p e a n d c o v e r a g e o f t h e 3 0 0 p l a n s
s t u d i e d , s e e p a g e 2.
30
A l l bu t 32 o f th e 300 p la n s s t u d ie d p e r m i t t e d r e t i r e m e n t b e f o r e the n o r m a l
r e t i r e m e n t a g e (t a b le 24 an d a p p e n d ix ).
A b o u t t w o -t h ir d s o f th e s e p la n s had b oth
e a r ly and d isa b ility r e tire m e n t p r o v is io n s .
T he re m a in in g th ird w e r e a lm o s t
e q u a lly d iv id e d b e tw e e n p la n s w ith e a r ly r e t i r e m e n t o n ly and t h o s e w ith d is a b ilit y
r e t i r e m e n t o n ly . M o s t o f the p la n s w ith o u t e i t h e r p r o v i s i o n w e r e m u l t i e m p l o y e r
p la n s , and a ll but on e w e r e n o n c o n t r ib u t o r y .
E a rly
R e tire m e n t
B e n e fits
E a r l y r e t i r e m e n t p r o v i s i o n s w e r e in c l u d e d in 2 24 p l a n s , t h r e e - f o u r t h s o f
t h o s e s t u d i e d , a n d c o v e r e d 2 o u t o f 3 w o r k e r s . A n a d d i t i o n a l 12 p l a n s , c o v e r i n g
a b o u t 3 5 0 , 000 w o r k e r s (e x c lu d e d f r o m the ta b u la t io n s ) p r o v i d e d e a r l y r e t i r e m e n t
f o r w o m e n o n l y . 23
W id e v a r i a t i o n s in i n d u s t r y p r a c t i c e s w e r e fo u n d a m o n g the p l a n s . A l l o f
th e s e l e c t e d p la n s in th e l u m b e r , r u b b e r , p r i m a r y m e t a l , f a b r i c a t e d m e t a l , an d
in stru m e n ts in d u s tr ie s , fo r e x a m p le , co n ta in e d p r o v is io n s f o r e a r ly r e t ir e m e n t but
n o n e o f t h e m in th e a p p a r e l an d h o t e l an d r e s t a u r a n t i n d u s t r i e s d id s o (t a b le 2 5 ).
E a r l y r e t i r e m e n t w a s p r o v i d e d b y a ll bu t o n e p la n in e a c h o f th e f o l lo w in g i n d u s
tries:
P a p e r , t o b a c c o , p ro d u cts o f p e tr o le u m , tra n s p o rta tio n eq u ip m e n t, c o m
m u n ic a tio n s , and e le c t r ic and gas u tilitie s.
In d u s tr ie s w ith a h ig h p r o p o r t io n o f m u lti e m p l o y e r p la n s u s u a lly h ad a
h ig h p r o p o r t io n o f p la n s w ith ou t e a r ly r e t ir e m e n t .
T h is r e f l e c t e d th e f a c t that
m o s t m u lt ie m p l o y e r p la n s d id n ot p r o v id e f o r e a r ly r e t i r e m e n t w h ile m o s t s in g le
e m p l o y e r p l a n s d id . N i n e - t e n t h s o f th e 231 s i n g l e e m p l o y e r p l a n s c o n t a i n e d e a r l y
r e t i r e m e n t p r o v i s i o n s , c o m p a r e d w i t h a b o u t a f o u r t h (1 8 o u t o f 69) o f m u l t i e m
p l o y e r p l a n s . E a r l y r e t i r e m e n t w a s p r o v i d e d b y a l l b u t 3 o f th e 49 c o n t r i b u t o r y
p l a n s , a n d b y 7 o u t o f 10 o f t h e 2 5 1 n o n c o n t r i b u t o r y p l a n s .
In a c o m p a r a b l e 1 9 5 2 s t u d y , o n l y 1 6 6 o f 3 0 0 p l a n s s t u d i e d b y t h e B u r e a u
h a d e a r l y r e t i r e m e n t p r o v i s i o n s . 24
L a r g e l y r e s p o n s i b l e f o r th e i n c r e a s e w a s
th e a d o p t io n o f e a r l y r e t i r e m e n t p r o v i s i o n s in th e b a s i c s t e e l , a lu m in u m , and
fa b r ic a te d s te e l p ro d u cts in d u strie s .
R e q u i r e m e n t s f o r E a r l y R e t i r e m e n t . — A s in c a s e s o f n o r m a l r e t i r e m e n t ,
a g e an d s e r v i c e a r e th e p r i n c i p a l c r i t e r i a u s e d to e s t a b l i s h e l i g i b i l i t y f o r e a r l y
retirem en t.
The e m p lo y e r ^ con sen t, r a r e ly a re q u ire m e n t fo r n o rm a l r e t ir e
m e n t, is a ls o c o m m o n l y r e q u ir e d .
S e r v i c e m a y r e f e r e it h e r to th e e n t ir e p e r i o d o f e m p l o y m e n t o r to th e
l e n g t h - o f - p l a n m e m b e r s h i p . 25 O f t h e 2 2 4 p l a n s w i t h e a r l y r e t i r e m e n t p r o v i s i o n s ,
67 c o n t a in e d p r e p a r t i c i p a t i o n r e q u i r e m e n t s .
P re p a rticip a tio n s e r v ic e was c r e d
it e d b y 24 p la n s t o w a r d e s t a b l i s h i n g e l i g i b i l i t y f o r e a r l y r e t i r e m e n t , b u t in th e
r e m a i n i n g 43 p la n s o n ly p la n m e m b e r s h i p s e r v i c e w a s c o u n t e d .
T w en ty -tw o o f
23 S i x o f t h e s e p l a n s , c o v e r i n g a p p r o x i m a t e l y 3 1 0 , 0 0 0 w o r k e r s , w e r e i n t h e
a p p a r e l in d u s t r y . In a l l c a s e s , t h e i r e a r l y r e t i r e m e n t a g e (6 2 ) c o i n c i d e d w ith th e
e a r l i e s t a g e at w h ic h p r i m a r y s o c i a l s e c u r i t y b e n e f i t s a r e p a y a b l e to w o m e n (in r e
d u c e d a m o u n t s ) . E x c e p t f o r v a r i a t i o n s in s e r v i c e r e q u i r e m e n t s , a t y p i c a l c l a u s e
p r o v i d e d that: C o v e r e d f e m a l e e m p l o y e e s w it h 20 o r m o r e y e a r s o f c r e d i t e d s e r v
i c e m a y r e t i r e p r i o r to n o r m a l r e t i r e m e n t d a te an d as o f th e f i r s t d a y o f a n y c a l
e n d a r m o n th c o in c i d e n t w ith o r a ft e r a tta in in g a g e 62.
24 S e e P e n s i o n P l a n s U n d e r C o l l e c t i v e B a r g a i n i n g ( B L S B u l l . 1 1 4 7 , 1 9 5 3 ) ,
p.
15.
25 S e e p a g e 3.
31
t h e s e 43 p la n s e x c l u d e d th e f i r s t f e w y e a r s o f s e r v i c e r e g a r d l e s s o f the w o r k e r ’ s
a g e , a n d 7 e x c l u d e d a l l s e r v i c e b e f o r e a s p e c i f i e d a g e — u s u a l l y 30 y e a r s (t a b le 2 6 ).
T h e r e m a i n i n g 14 p l a n s h a d a c o m b i n a t i o n o f a g e a n d s e r v i c e r e q u i r e m e n t s f o r
p la n p a r tic ip a tio n .
A g e an d s e r v i c e r e q u i r e m e n t s f o r e a r l y r e t i r e m e n t a r e s h o w n in t a b le 27
b e f o r e a d ju s t m e n t f o r the 43 p la n s th at d id n o t c r e d i t p r e p a r t i c i p a t i o n s e r v i c e a n d
i n t a b l e 2 8 a f t e r s u c h a d j u s t m e n t . A p p r o x i m a t e l y 70 p e r c e n t o f t h e p l a n s , c o v e r
in g a l m o s t 80 p e r c e n t o f th e w o r k e r s , h a d b o t h a g e an d s e r v i c e
re q u ire m e n ts.
O n e h u n d r e d p l a n s c o v e r i n g o v e r h a l f t h e w o r k e r s r e q u i r e d t h a t t h e y b e 60 y e a r s
o f a g e a n d h a v e 10 o r 15 y e a r s o f s e r v i c e ( t a b l e 2 8 ) . T h i s c o n c e n t r a t i o n i s d u e
t o t h e s p e c i f i c a t i o n o f a g e 60 a n d 10 y e a r s o f s e r v i c e b y p l a n s i n t h e a u t o m o b i l e
i n d u s t r y a n d a g e 6 0 a n d 15 y e a r s i n s t e e l p l a n s .
M i n i m u m s e r v i c e r e q u i r e m e n t s r a n g e d u p to 30 y e a r s .
M o r e than h a lf
t h e p l a n s s p e c i f i e d e i t h e r 10 o r 15 y e a r s o f s e r v i c e , w h i l e o n e o u t o f f i v e r e q u i r e d
l e s s t h a n 10 y e a r s o f s e r v i c e .
A l l p la n s p e r m i t t e d e a r l y r e t i r e m e n t at l e a s t 5 y e a r s b e f o r e the n o r m a l
r e t i r e m e n t a g e ( w h i c h w a s 65 i n a l l b u t 7 p l a n s ) , a n d 4 5 p e r c e n t o f t h e p l a n s ,
c o v e r i n g a t h i r d o f t h e w o r k e r s , a l l o w e d u p t o 10 y e a r s . O n l y a f e w p l a n s p e r
m i t t e d e a r l y r e t i r e m e n t m o r e t h a n 10 y e a r s b e f o r e t h e n o r m a l r e t i r e m e n t a g e .
T h e fo l l o w i n g c u m u la t iv e ta b u la t io n s h o w s the n u m b e r o f y e a r s b e f o r e n o r m a l
r e t ir e m e n t a g e at w h ich e a r ly r e t ir e m e n t b e n e fit s w e r e f i r s t p a y a b le .
P la n s
W orkers
(th ou sa n d s)
A ll p la n s w ith e a r ly r e t ir e m e n t
p r o v i s i o n s _____________________________ _____
224
3 ,0 3 1 .6
5 y e a r s o r l e s s _________________________ —
- 7 y e a r s o r l e s s _________________________ _________
10 y e a r s o r l e s s _______________________ _________
15 y e a r s o r l e s s _______________________ _________
20 y e a r s o r l e s s _______________________ _________
A n y a g e ___________________________________ _________
224
102
101
17
11
10
3, 0 3 1 . 6
1, 0 4 7 . 5
1 ,0 3 3 .6
224. 6
2 0 9 .9
205. 9
NOTE:
the e a r l i e s t
w h e t h e r the
fo r a listin g
W h e re a lte rn a tiv e r e q u ir e m e n ts w e r e s p e c ifie d ,
p o ssib le
age fo r m en was used,
re g a rd le ss of
e m p lo y e r ’ s con sen t w as r e q u ire d .
S e e ta b le 27
of a lte rn a tiv e s.
W o m e n w e r e p e r m i t t e d to r e t i r e u p to 5 y e a r s e a r l i e r th a n m e n in
10 p l a n s c o v e r i n g 2 0 8 , 2 0 0 w o r k e r s , a n d u p t o 10 y e a r s e a r l i e r i n 1 p l a n w i t h
2 ,9 0 0 w o r k e r s .
A l l b u t tw o o f t h e s e p la n s a l s o s p e c i f i e d a s e x d i f f e r e n t i a l in
n o rm a l re tire m e n t ages.
T h r e e ou t o f fo u r p la n s p e r m i t t e d the q u a lifie d w o r k e r to r e t i r e e a r l y
o n h is o w n v o li t io n . T h e o t h e r p la n s e it h e r r e q u i r e d th e e m p l o y e r ’ s c o n s e n t o r
p e r m i t t e d the e m p l o y e r to in itia te th e w o r k e r 's r e t i r e m e n t .
T w e n ty -e ig h t p la n s
p e r m i t t e d th e e m p l o y e r to r e q u e s t a w o r k e r ’ s r e t i r e m e n t , an d o n ly o n e o f t h e m
r e q u i r e d t h e e m p l o y e e ’ s a s s e n t . 26 In n i n e p l a n s , a g e a n d s e r v i c e r e q u i r e m e n t s
26
E x c l u d e s th e " s p e c i a l ” e a r l y r e t i r e m e n t b e n e f i t p r o v i s i o n s o f 25 p l a n s
u n d e r a ll b u t 1 o f w h ic h an e m p l o y e e m a y b e c o m p e l l e d to r e t i r e at the e m
p lo y e r ^ requ est.
S e e p a g e 4.
32
w e re le s s
r e s t r i c t i v e w h e n the e m p l o y e r r e q u e s t e d r e t i r e m e n t .
E a ch party*s
r ig h t to r e q u e s t e a r l y r e t i r e m e n t an d the o t h e r p a r t y * s r ig h t, i f a n y , r e g a r d i n g
s u c h a r e q u e s t a r e s h o w n in th e f o l lo w in g ta b u la t io n :
A p p r o v a l of a ction b y oth er p a rty
T otal
R eq u ired
N ot r e q u ir e d
W orkers
W orkers
W orkers
(th ou
(th ou
(th ou
P la n s sa n d s) P la n s sa n d s) P la n s sa n d s)
A ll p la n s w ith e a r ly
r e t i r e m e n t ______________________
E a rly re tire m e n t m a y be
i n i t i a t e d b y 1----W o r k e r ________________________
E m p l o y e r ____________________
E i t h e r __________________________
W h e n w o r k e r i n i t i a t e s __
W h en e m p l o y e r in itia te s
1
224
3, 0 3 1 . 6
-
1 9 6 2, 5 3 4 . 6
3
37. 9
25
459. 1
46
0
—
E x clu d es s p e c ia l e a r ly r e tire m e n t.
-
-
-
8
1
-
320. 1
0
-
156. 8
1. 2
-
150
3
-
17
24
-
2, 2 1 4 . 5
37. 9
-
302. 3
457. 9
S e e p a g e 4.
A m o u n t o f B e n e fit s . — A p a r t fr o m a r e d u ctio n f o r a g e, a lm o s t 9 out o f
10 p l a n s u s e d t h e s a m e f o r m u l a t o c o m p u t e e a r l y r e t i r e m e n t b e n e f i t s t h a t t h e y
u s e d to c o m p u t e n o r m a l r e t i r e m e n t b e n e fit s (t a b le 2 9).
W ith th e e x c e p t i o n o f
fo u r p la n s,
the r e m a i n d e r u s e d a s lig h t m o d i f i c a t i o n
o f the n o r m a l r e t i r e
m en t fo rm u la .
E a r l y r e t i r e m e n t b e n e fit s a r e a l m o s t a lw a y s l e s s th an n o r m a l r e t i r e
m e n t b e n e f i t s , b e c a u s e o f (1) th e s h o r t e r t i m e th e w o r k e r s h a v e t o a c c u m u l a t e
c r e d i t e d s e r v i c e a n d , (2 ) t h e l o n g e r t i m e t h e y w i l l h a v e , o n t h e a v e r a g e , t o
r e ce iv e p aym en ts.
B e c a u s e a l m o s t a ll p la n s h a d b e n e f i t f o r m u l a s b a s e d , at
l e a s t in p a r t , on c r e d i t e d s e r v i c e , w o r k e r s r e t i r i n g e a r l y w o u ld r e c e i v e l o w e r
b e n e fit s . M o r e o v e r , a ll but fo u r p la n s m a d e a fu r th e r r e d u c tio n to a v o id e x c e s s i v e
c o s t s d u e to the l o n g e r l i f e e x p e c t a n c y o f e a r l y r e t i r e e s .
A b o u t t h r e e ou t o f f i v e p la n s p r o v i d e d f o r th e p a y m e n t o f the a c t u a r i a l
e q u i v a l e n t o f t h e n o r m a l b e n e f i t 27 ( t a b l e 2 9 ) . A l l b u t 10 o f t h e s e p l a n s s p e c i f i e d
th e p e r c e n t a g e r e d u c t io n at e a c h y e a r o f a g e .
M o s t o f the r e m a i n i n g p la n s s t i p
u la t e d a p e r c e n t a g e r e d u c t io n f o r e a c h m o n th b y w h ic h r e t i r e m e n t p r e c e d e s the
n o r m a l r e t i r e m e n t a g e — in a l m o s t h a l f o f t h e s e p l a n s 0. 60 o r 0. 50 p e r c e n t p e r
m o n t h . A b o u t a d o z e n p l a n s ( c l a s s i f i e d i n t a b l e 29 a m o n g no t h e r n ) u s e d
several
p e r c e n t a g e s d e p e n d in g on th e w o r k e r * s a g e at r e t i r e m e n t ; f o r e x a m p l e , o n e p la n
r e d u c e d b e n e f i t s 3 p e r c e n t f o r e a c h y e a r b e t w e e n 65 a n d 6 0 , 7 p e r c e n t f o r e a c h
y e a r b e t w e e n 59 an d 55, an d a c t u a r i a l l y b e y o n d 55.
T he e a r ly r e tir e m e n t b e n e fits p r o v id e d b y a b a s ic s te e l and an a u to m o
b i l e p a r t s p l a n , w h i c h u s e a n a c t u a r i a l a n d a n 0. 60 p e r c e n t r e d u c t i o n , r e s p e c t i v e l y ,
a r e s h o w n b e l o w a s a p e r c e n t a g e o f the n o r m a l r e t i r e m e n t b e n e f i t p r o v i d e d b y
e a c h p l a n a t a g e s 60 t o 6 5 .
m ate
27
cost
is
The a ctu a ria l
e x p e c t e d to b e
e q u iv a le n t o f the n o r m a l b e n e f it is a b e n e f it w h o s e
e q u a l, o n the a v e r a g e , to th a t o f th e n o r m a l b e n e fit .
u lti
33
P e r c e n t o f n o r m a l b e n e fit p a y a b le
R e tire m e n t age
65
64
63
62
61
60
( n o r m a l ) _________
_______________
_____________________
_____________________
_____________________
_____________________
B a s ic s t e e l p la n
(a ctu a ria l re d u ctio n )
1 0 0 . 00
9 1 .8 4
8 4 . 60
7 9 . 14
72. 36
6 7 . 18
A u t o m o b ile p a r ts p la n
( 0 . 60 p e r c e n t - p e r m o n t h
re d u ctio n )
1 0 0 . 00
9 2 .8 0
8 5 . 60
78. 40
7 1 . 20
6 4 . 00
M o r e th an t h r e e ou t o f fi v e p la n s , c o v e r i n g a b o u t th e s a m e r a t io o f
w o r k e r s , p e r m i t t e d th e r e t i r i n g w o r k e r to d e f e r r e c e i p t o f b e n e fit s u n til th e
n o r m a l r e t i r e m e n t a g e (ta b le 30).
U n d e r s o m e p la n s , w o r k e r s w h o s e l e c t th is
o p t io n m a y e x p e c t to r e c e i v e a m o n t h ly b e n e f it at the l a t e r a g e th at is a b o u t
50 p e r c e n t h i g h e r th an th e y a r e e n t it le d to if, f o r e x a m p l e , th e y r e t i r e at a g e 60.
S o c ia l S e c u r it y A d ju s tm e n t O p tio n . — M o r e than on e ou t o f fiv e p la n s w ith
an e a r l y r e t i r e m e n t p r o v i s i o n p e r m i t t e d th e w o r k e r to c h o o s e a ‘ 's o c i a l s e c u r i t y
a d j u s t m e n t o p t i o n " o r , a s it is c a l l e d in s o m e p l a n s , " a l e v e l i n c o m e r e t i r e m e n t
o p t io n , " b e c a u s e a p r i m a r y ( o l d - a g e ) in s u r a n c e b e n e fit u n d e r s o c i a l s e c u r i t y is
n o t p a y a b l e t o t h e q u a l i f i e d w o r k e r u n t i l h e r e a c h e s a g e 65 ( a g e 6 2 f o r w o m e n )
(t a b le 3 1 ). So th at to t a l m o n t h ly b e n e fit s (p la n b e n e fit s p lu s p r i m a r y s o c i a l s e
c u r i t y b e n e fit s ) a r e e q u a liz e d , t h e s e p la n s p r o v i d e d a g r e a t e r b e n e f it to the w o r k e r
than w a s a c t u a lly du e h im u n d e r the p la n f o r m u l a p r i o r to r e c e i p t o f th e p r i m a r y
s o c i a l s e c u r i t y b e n e fit , an d a r e d u c e d b e n e fit a ft e r th at t i m e . A b o u t h a lf o f the
c o n t r i b u t o r y p la n s c o n t a in e d s u c h a p r o v i s i o n as a g a in s t a s ix t h o f the n o n c o n
tr ib u to r y p la n s.
S p e c i a l E a r l y R e t i r e m e n t B e n e f i t s . — In r e c e n t y e a r s , s o m e p l a n s in th e
a u to m o b ile and r u b b e r in d u s tr ie s h a v e a d d ed s p e c ia l b e n e fit fe a t u r e s to e a r ly r e
t i r e m e n t p r o v i s i o n s th a t, in g e n e r a l , a p p e a r to c o m b i n e e l e m e n t s o f c o m p u l s o r y
e a r ly r e tir e m e n t, a s e v e r a n c e a rra n g e m e n t, and m o d ifie d d is a b ility r e tir e m e n t
r e l a t e d t o a w o r k e r 1s i n c a p a c i t y t o p e r f o r m h i s j o b r a t h e r t h a n t o t o t a l a n d p e r
m a n e n t d i s a b i l i t y . 28
U n d e r t h e s e p r o v i s i o n s , a ll but tw o p la n s s t a t e d that a
w o r k e r e l i g i b l e f o r e a r l y r e t i r e m e n t c o u ld b e r e t i r e d at th e o p t io n o f th e c o m
pany.
T h r e e o f th e s e p la n s a ls o p e r m it t e d r e t ir e m e n t " u n d e r m u tu a lly s a t i s
f a c t o r y c o n d i t i o n s . " 29
T h e b e n e fit s p a y a b le w e r e s u b s t a n t ia lly h ig h e r th an th e y
w o u ld b e u n d e r the r e g u la r e a r l y r e t i r e m e n t p r o v i s i o n s o f t h e s e p la n s .
T w e n t y - f i v e p la n s in th is s t u d y , c o v e r i n g 7 2 4 , 00 0 w o r k e r s , p r o v i d e d a
s p e c ia l e a r ly r e t ir e m e n t b e n e fit.
A l l b u t o n e w e r e in th e a u t o m o b i le o r r u b b e r
in d u strie s .
T h e a g e a n d s e r v i c e r e q u i r e m e n t s f o r the s p e c i a l b e n e f it w e r e th e
s a m e a s f o r t h e r e g u l a r e a r l y r e t i r e m e n t b e n e f i t : A g e 6 0 w i t h 10 y e a r s 1 s e r v i c e
in th e a u t o m o b i l e p l a n s a n d a g e 55 w i t h 20 y e a r s in th e r u b b e r p l a n s . E m p l o y e r s
c o u ld c o m p e l e l i g i b l e w o r k e r s to r e t i r e u n d e r a ll bu t o n e p la n , w h ic h r e q u i r e d
28 O n e p l a n w e n t f u r t h e r t h a n t h e o t h e r s b y e x p l i c i t l y s t a t i n g t h a t t h e b e n e
fit " s h a ll b e d e e m e d to in c lu d e c a s e s o f p e r m a n e n t and tota l d is a b ilit y o c c u r r in g
a f t e r a g e 60 w i t h 10 b u t l e s s t h a n 15 y e a r s o f s e r v i c e , [ l b y e a r s o f s e r v i c e r e
q u ire d f o r p e r m a n e n t and tota l d is a b ilit y r e t i r e m e n t / and s h a ll a ls o in clu d e r e
t i r e m e n t d i r e c t l y a t t r ib u t a b le to p la n t c l o s i n g s o r s h u t d o w n s w h i c h r e s u l t in th e
p e r m a n e n t l a y o f f o f a n e m p l o y e e a g e 60 o r o l d e r a t t h e t i m e o f s u c h l a y o f f . "
29 T h i s t e r m w a s n o t d e f i n e d i n a n y o f t h e s e p l a n s .
34
th e w o r k e r ^ a g r e e m e n t . E x c e p t in th e c a s e o f tw o s m a l l p l a n s , e l i g i b l e w o r k e r s
c o u l d r e q u e s t r e t i r e m e n t ; h o w e v e r , the e m p l o y e r ^ c o n s e n t w a s r e q u i r e d u n d e r
a ll e x c e p t on e o f th e s e p la n s .
I n a l l 25 p l a n s , t h e s p e c i a l b e n e f i t w a s d o u b l e t h e n o r m a l b e n e f i t t o
w h i c h t h e w o r k e r ’ s s e r v i c e e n t i t l e d h i m , w i t h o u t a n y r e d u c t i o n f o r a g e . 30
It
r a n g e d b e t w e e n tw o an d f o u r t i m e s the e a r l y r e t i r e m e n t b e n e f it f o r w o r k e r s
w ith the s a m e a m o u n t o f c r e d i t e d s e r v i c e . T h e y o u n g e r th e w o r k e r th e g r e a t e r
th e d i f f e r e n c e b e t w e e n the tw o b e n e fit s b e c a u s e f o r e a c h m o n t h th e w o r k e r w a s
u n d e r th e n o r m a l r e t i r e m e n t a g e , th e e a r l y r e t i r e m e n t b e n e f it w a s r e d u c e d and
the s p e c i a l b e n e fit w a s n ot.
F o r e x a m p le , u n d e r a ty p ic a l a u to m o b ile in d u s tr y
p l a n , a w o r k e r r e t i r i n g a t h i s o w n o p t i o n a t t h e f i r s t o p p o r t u n i t y ( a g e 60 w i t h
10 y e a r s o f c r e d i t e d s e r v i c e ) w o u l d r e c e i v e $ 3 2 a m o n t h f o r t h e r e s t o f h i s l i f e ,
w h i l e o n e n o t e x e r c i s i n g h i s o p t i o n u n t i l a g e 64 w o u l d g e t $ 4 6 . 4 0 a m o n t h . 31
B u t i f t h e s e s a m e w o r k e r s r e t i r e d at th e e m p l o y e r ’ s o p t i o n , t h e y w o u l d r e c e i v e ,
r e g a r d l e s s o f t h e i r a g e , a s p e c i a l b e n e f i t o f $ 100 a m o n t h u n t il a g e 65.
T h e s p e c i a l b e n e f i t w a s r e p l a c e d , u n d e r 18 p l a n s , b y t h e n o r m a l b e n e f i t
w h e n t h e p e n s i o n e r r e a c h e d a g e 65-----t h e n o r m a l r e t i r e m e n t a g e -----o r b e c a m e e l i g i
b le fo r e ith e r s o c ia l s e c u r ity p r im a r y (o ld -a g e ) o r d is a b ility b e n e fits . T he w o r k e r
in th e f o r e g o i n g e x a m p l e w o u ld , t h e r e f o r e , r e c e i v e f r o m th e p la n $ 5 0 a m o n t h
a f t e r a g e 65 u n d e r t h e n o r m a l b e n e f i t f o r m u l a , a s c o m p a r e d w i t h $ 3 2 o r $ 4 6 . 4 0
u n d e r th e r e g u l a r e a r l y r e t i r e m e n t f o r m u l a . T h e r e m a i n i n g 7 p la n s , w ith n e a r l y
as m u c h c o v e r a g e a s th e 18, d id n o t r e c o m p u t e b e n e f i t s if th e p e n s i o n e r l a t e r
sh o u ld b e c o m e e lig ib le f o r s o c ia l s e c u r it y d is a b ilit y b e n e fit s . F iv e o f th e s e p la n s
s u b s t i t u t e d t h e n o r m a l b e n e f i t w h e n t h e w o r k e r r e a c h e d 65 o r q u a l i f i e d f o r p r i
m a r y s o c i a l s e c u r i t y b e n e fit s an d tw o s m a l l p la n s p o s t p o n e d r e c o m p u t a t i o n u n til
a g e 65 r e g a r d l e s s o f t h e r e c e i p t o f a n y s o c i a l s e c u r i t y b e n e f i t s . T h e d i s t i n c t i o n
is r a r e l y s ig n ific a n t f o r m a l e p e n s i o n e r s , but f o r m o s t f e m a l e p e n s i o n e r s r e
c o m p u t a t i o n w o u l d o c c u r w h e n t h e y r e a c h e d 62 y e a r s o f a g e u n d e r f i v e p l a n s ,
s i n c e at that a g e th o s e w ith e n o u g h s e r v i c e to q u a lify f o r s p e c i a l b e n e fit s w o u ld
a ls o be e lig ib le fo r p r im a r y s o c ia l s e c u r ity b e n e fits.
R e p l a c i n g th e s p e c i a l b e n e f i t b y th e n o r m a l b e n e f i t w o u l d c u t in h a lf
t h e a m o u n t p a i d b y e a c h o f t h e 2 5 p l a n s . 32
H o w e v e r , th e r e d u c t i o n w o u ld , in
m o s t i n s t a n c e s , b e m o r e th an m a d e up b y p r i m a r y ^ o ld -a g e ) s o c i a l s e c u r i t y b e n e
fit s f o r w h ic h the p e n s i o n e r w o u ld o r d i n a r i l y b e c o m e e l i g i b l e w h e n h is b e n e fit s
w e r e r e c o m p u t e d . W h ile the a v e r a g e m o n t h ly w a g e o f w o r k e r s r e t i r i n g f r o m a ll
e m p l o y m e n t c o v e r e d b y th e S o c i a l S e c u r i t y A c t b e f o r e
a g e 65 (6 2 f o r w o m e n )
w ou ld , o f c o u r s e , b e r e d u c e d b y th e ir y e a r s o f no e a r n in g s , th e ir b e n e fits w ou ld
s t i l l b e h i g h e n o u g h t o o f f s e t t h e r e d u c t i o n i n p r i v a t e p l a n b e n e f i t s . 33
30 T h e s p e c i a l b e n e f i t w o u l d b e l e s s t h a n t w i c e t h e n o r m a l b e n e f i t f o r w o r k
e r s w ith h ig h e a r n in g s u n d e r tw o p la n s that u s e d a s e r v i c e an d e a r n in g s f o r m u l a
f o r c o m p u tin g th e ir n o r m a l b e n e fits and a s e r v i c e fo r m u la f o r co m p u tin g s p e c ia l
b e n e fits.
31 C o m p u t e d a s f o l l o w s :
(20 y e a r s x $ 2 . 5 0 )
/ T - ( 6 0 m o n t h s x 0. 6% £7 = $ 5 0 ( 1 - 3 6 % ) = 6 4 % x $ 5 0 a n d
(2 0 y e a r s x $ 2 . 5 0 )
/T - ( 1 2 m o n t h s x 0 . 6%J[7 = $ 5 0 ( 1 - 7 . 2 % ) = 9 2 . 8 % x $ 5 0 .
32 U n d e r t w o s m a l l p l a n s t h e r e d u c t i o n w o u l d , i n s o m e c a s e s , b e l e s s f o r
s o m e p e n s i o n e r s b e c a u s e th e s p e c i a l b e n e f i t is t w i c e th e n o r m a l m i n i m u m b e n e
fit.
P e n s io n e r s w ith lo n g s e r v i c e en titlin g th e m to m o r e than m in im u m n o r m a l
b e n e fit s w o u ld , o f c o u r s e , g e t m o r e th an h a lf t h e ir s p e c i a l b e n e fit .
33 T h e m a x i m u m
r e d u c t i o n u n d e r a l l b u t 1 o f t h e 25 p l a n s f o r a w o r k e r
w it h 20 y e a r s o f s e r v i c e w a s $ 5 0 . P r i m a r y s o c i a l s e c u r i t y b e n e f i t s e x c e e d th a t
a m ou n t f o r w o r k e r s w ith a v e r a g e m o n th ly w a g e s o f $ 8 4 o r m o r e . T o h a v e a v e r
a g e e a r n in g s o f $ 8 4 at 65, w o r k e r s r e t i r i n g f r o m a ll c o v e r e d e m p l o y m e n t at a g e
55 (th e m i n i m u m a g e at w h i c h s p e c i a l b e n e f i t s w e r e p a y a b l e ) w o u ld o n l y h a v e to
e a r n $ 9 6 . 3 5 a m o n t h , o n t h e a v e r a g e , b e t w e e n a g e s 21 a n d 5 5 .
35
D is a b ility
R e tir e m e n t
B e n e fits
D is a b ility
r e t i r e m e n t p r o v i s i o n s w e r e i n c l u d e d in 2 1 9 o f t h e 3 0 0 p l a n s
s t u d i e d ( t a b l e 3 2 )----- a p p r o x i m a t e l y t h e s a m e p r o p o r t i o n a s in t h e B u r e a u 1s 1 9 5 2
stu d y .
F o u r o u t o f 5 o f t h e 2 3 1 s i n g l e e m p l o y e r p l a n s , c o v e r i n g m o r e th a n 9
o u t o f 10 w o r k e r s i n t h i s c a t e g o r y , p r o v i d e d d i s a b i l i t y r e t i r e m e n t b e n e f i t s , c o m
p a r e d w i t h h a l f o f t h e 69 m u l t i e m p l o y e r p l a n s , r e p r e s e n t i n g s l i g h t l y m o r e t h a n
600, 000 w o r k e r s .
T h r e e ou t o f fiv e c o n t r ib u t o r y p la n s , and t h r e e ou t o f fo u r
n o n c o n tr ib u to r y p la n s , p r o v id e d f o r d is a b ilit y r e t ir e m e n t .
In a d d i t i o n , 4 9 p l a n s
w i t h o u t d i s a b i l i t y r e t i r e m e n t b e n e f i t s p r o v i d e d a p a r t i a l s u b s t i t u t e in t h e f o r m
o f e a r l y r e t i r e m e n t b e n e f i t s . (S e e a p p e n d i x f o r t h e i r i n d u s t r y d i s t r i b u t i o n . ) D i s
a b i l i t y r e t i r e m e n t p r o v i s i o n s w e r e i n c l u d e d in a l l o f t h e
p l a n s in t h e l u m b e r ;
r u b b e r ; p r im a r y m e ta l; fa b r ic a t e d m e t a l; s to n e , c la y , and
g la s s p r o d u c t s ; and
h o t e l i n d u s t r i e s ; a n d in a l l b u t o n e p l a n in e a c h o f t h e f o l l o w i n g i n d u s t r i e s : T o b a c c o
m a n u fa c tu r e s , p r o d u c ts o f p e tr o le u m , le a t h e r , c o m m u n ic a tio n s , and m is c e lla n e o u s
n o n m a n u fa c t u r in g (t a b le 3 2 ).
O n l y o n e p l a n in t h e s e r v i c e i n d u s t r i e s
c o n ta in e d
su ch a p r o v is io n .
R e q u ir e m e n ts fo r D is a b ility R e t ir e m e n t . — A w o r k e r d is a b le d fo r a c e r ta in
l e n g t h o f t i m e — u s u a l l y 6 m o n t h s -----b y a p h y s i c a l i m p a i r m e n t o f a s e v e r i t y a n d e x
p e c t e d fu t u r e d u r a t io n d e fin e d b y e a c h p la n w a s a ls o r e q u ir e d to m e e t c e r t a i n a g e
o r s e r v i c e r e q u ir e m e n t s o r b o th to q u a lify f o r d is a b ilit y b e n e fit s .
The age r e
q u ir e m e n t s te n d e d to b e l o w e r , i f in c lu d e d a t a ll, a n d th e s e r v i c e r e q u ir e m e n t s
l o n g e r f o r d is a b i lit y r e t i r e m e n t th a n f o r e a r l y r e t i r e m e n t . S e r v i c e r e q u ir e m e n t s
w e r e e x p r e s s e d , j u s t a s f o r o t h e r r e t i r e m e n t p r o v i s i o n s , e i t h e r in t e r m s o f
le n g th o f e m p lo y m e n t o r p e r i o d o f p la n m e m b e r s h i p .
O n l y 23 o f t h e 2 1 9 p l a n s p r o v i d i n g d i s a b i l i t y r e t i r e m e n t b e n e f i t s h a d a n y
p r e p a r t i c i p a t i o n r e q u i r e m e n t s , a n d 5 o f t h e s e c r e d i t e d p r e p a r t i c i p a t i o n s e r v i c e in
d e te r m in in g e lig ib ilit y f o r b e n e fit s .
T h e m a j o r i t y o f t h e 18 p l a n s n o t c r e d i t i n g
p r e p a r t i c i p a t i o n s e r v i c e l i m i t e d p la n m e m b e r s h i p to w o r k e r s w ith a s h o r t p e r i o d
o f s e r v ic e — u s u a lly 1 y e a r .
T h e r e s t a l s o r e q u i r e d th a t t h e y b e a t l e a s t 25 to
35 y e a r s o f a g e (t a b le 3 3 ).
A lt h o u g h a t th e t i m e o f th is s tu d y , s o c i a l s e c u r i t y d i s a b i l i t y b e n e f it s w e r e
n o t p a y a b l e u n t i l a g e 5 0 , 34 n o a g e r e q u i r e m e n t w a s f o u n d in 75 p e r c e n t o f t h e p l a n s
c o v e r i n g m o r e th a n 80 p e r c e n t o f th e w o r k e r s .
T h e r e m a in in g p la n s s tip u la te d
a g e s r a n g i n g f r o m 4 0 t o 6 0 , u s u a l l y a g e 5 0 o r 5 5 35 ( t a b l e 3 4 ) .
S e r v i c e r e q u i r e m e n t s , o n t h e o t h e r h a n d , w e r e f o u n d in a l m o s t a l l p l a n s .
T h e y r a n g e d f r o m 1 t o 25 y e a r s , a f t e r m a k i n g a p p r o p r i a t e a d j u s t m e n t s f o r t h e
18 p l a n s t h a t d i d n o t c r e d i t p r e p a r t i c i p a t i o n s e r v i c e w h e n d e t e r m i n i n g e l i g i b i l i t y
( t a b l e 3 5 ) . A p p r o x i m a t e l y 70 p e r c e n t o f t h e p l a n s c o v e r i n g m o r e th a n t h r e e o u t
o f f o u r w o r k e r s , r e q u i r e d 15 y e a r s o f s e r v i c e .
34 S e e f o o t n o t e 2 1 .
35 S i m i l a r f i n d i n g s w e r e m a d e in a r e p o r t s u m m a r i z i n g 9 s e p a r a t e s t u d i e s
m a d e b e tw e e n 1950 and 1957.
S e e U . S . D e p a r t m e n t o f H e a lth , E d u c a t io n , a n d
W e lfa r e , B u re a u o f O ld -A g e and S u r v iv o r s In s u r a n c e , A g e and S e r v ic e R e q u ir e
m e n t s f o r T o t a l a n d P e r m a n e n t D i s a b i l i t y B e n e f i t s in P r i v a t e P e n s i o n P l a n s
( A n a l y t i c a l N o t e N o . 1 0 8 ), F e b r u a r y I 9 6 0 .
36
B e n e f it F o r m u l a s . — A s in e a r l y r e t i r e m e n t , m o s t p la n s p r o v i d e d d i s a
b i l i t y b e n e f i t s b a s e d , a t l e a s t in p a r t , o n t h e n o r m a l r e t i r e m e n t f o r m u l a . A f t e r
a w a i t i n g p e r i o d , 36 u s u a l l y 6 m o n t h s (t h e s a m e p e r i o d r e q u i r e d t o q u a l i f y f o r
s o c i a l s e c u r i t y d i s a b i l i t y b e n e f i t s ) , d i s a b i l i t y b e n e f i t s w e r e i m m e d i a t e l y p a y a b l e . 37
F o r w o r k e r s r e c e iv in g , o r e lig ib le f o r , s o c i a l s e c u r it y d is a b ilit y b e n e fit s m o s t
p la n s u s e d th e s a m e f o r m u l a a s f o r n o r m a l r e t i r e m e n t .
A m o r e lib e r a l f o r
m u la w a s u s e d b y m o s t p la n s to c o m p u te b e n e fit s f o r o t h e r d is a b le d w o r k e r s ,
i n c l u d i n g t h o s e r e t i r i n g u n d e r t h e 171 p l a n s p r o v i d i n g b e n e f i t s b e f o r e a g e 5 0 —
th e m in im u m a g e at w h ic h s o c i a l s e c u r it y d is a b ilit y b e n e fit s w e r e p a y a b le at th e
t im e o f th is s tu d y .
M o s t p la n s p r o v id e d b e n e fit s c o m p u t e d b y o n e o r m o r e o f th e f o llo w in g
t y p e s o f fo r m u l a s — th e s a m e ty p e s a s w e r e u s e d to c o m p u t e n o r m a l b e n e f it s :
(1 ) M u l t i p l y i n g a f i x e d d o l l a r a m o u n t b y y e a r s o f c r e d i t e d s e r v i c e , (2 ) m u l t i
p ly in g a p e r c e n t a g e o f a v e r a g e e a r n in g s (f o r th e w o r k e r * s e n t ir e p e r io d o f c r e d
i t e d s e r v i c e o r f o r a s p e c i f i e d p e r i o d ) b y y e a r s o f c r e d i t e d s e r v i c e , 38 o r (3 ) a
u n ifo r m m o n t h ly a m o u n t. J u s t a s f o r n o r m a l b e n e f it s , m o r e th a n tw o o u t o f fiv e
d i s a b i l i t y p la n s a l s o a s s u r e d th e w o r k e r a s p e c i f i e d m in im u m d i s a b i l i t y b e n e fit o r
a m in im u m c a lc u la t e d b y an a lt e r n a t e fo r m u la . T h e fo r m u la u s e d f o r th o s e e l i g i
b le f o r o r r e c e i v i n g s o c i a l s e c u r i t y d i s a b i l i t y b e n e fit s w a s m o s t c o m m o n l y th e
s a m e a s th a t u s e d to c o m p u t e n o r m a l r e t i r e m e n t b e n e fit s f o r w o r k e r s w ith th e
s a m e s e r v i c e a n d e a r n i n g s . 39
U n d e r b a s ic s t e e l p la n s , f o r e x a m p le , th e q u a lifie d w o r k e r w o u ld r e c e iv e
t h e g r e a t e s t a m o u n t o f t h e a m o u n t s c a l c u l a t e d u n d e r t h r e e i n d e p e n d e n t f o r m u l a s : 40
(1 ) $ 9 0 a m o n t h i n c l u d i n g , f o r t h o s e w h o q u a l i f y , t h e s o c i a l s e c u r i t y d i s a b i l i t y
b e n e f i t ; (2 ) 1 p e r c e n t o f a v e r a g e m o n t h l y e a r n i n g s d u r i n g t h e 1 2 0 m o n t h s i m m e
d ia t e ly p r e c e d in g d is a b i lit y m u lt ip lie d b y y e a r s o f c o n tin u o u s s e r v i c e , l e s s $ 8 5
( f o r s o c i a l s e c u r i t y b e n e f i t s ) , 41 o r (3 ) $ 2 . 5 0 t i m e s y e a r s o f c o n t i n u o u s s e r v i c e
a ft e r O c t o b e r 3 1 , 1 9 5 7 , p lu s $ 2 .4 0 t im e s y e a r s o f c o n tin u o u s s e r v i c e p r i o r to
N o v e m b e r 1, 1 9 5 7 , u p t o a c o m b i n e d m a x i m u m o f 3 0 y e a r s .
A t a g e 6 5 , th e
b e n e f it w o u ld b e r e c o m p u t e d o n th e n o r m a l r e t i r e m e n t f o r m u l a s , b u t s in c e th e
l a s t t w o f o r m u l a s a r e t h e s a m e a s t h e n o r m a l r e t i r e m e n t f o r m u l a s , in m o s t
c a s e s , t h e r e w o u l d b e n o c h a n g e in t h e b e n e f i t a m o u n t .
P l a n s in t h e a u t o m o b i l e
i n d u s t r y , t o c it e a n o t h e r e x a m p le , p r o v i d e d a d i s a b i l i t y b e n e f it th a t w a s e q u a l t o
t w i c e th e n o r m a l b e n e f it ( $ 5 a m o n t h f o r e a c h y e a r o f c r e d i t e d s e r v i c e in s t e a d
o f $ 2 . 5 0 ) . W h e n th e w o r k e r b e g a n to r e c e i v e a s o c i a l s e c u r i t y d i s a b i l i t y b e n e
f i t o r a tt a in e d a g e 6 5 , th e n o r m a l b e n e fit f o r m u l a o f $ 2 . 5 0 t i m e s y e a r s o f c r e d
it e d s e r v i c e , e x c lu s i v e o f s o c i a l s e c u r i t y b e n e f it s , w o u ld b e s u b s titu te d .
36 T e m p o r a r y d i s a b i l i t y b e n e f i t s u n d e r h e a l t h a n d i n s u r a n c e p l a n s w e r e
u s u a lly p a y a b le f o r a ll o r p a r t o f th e w a itin g p e r i o d .
S e e H e a lth a n d I n s u r a n c e
P la n s U n d e r C o lle c t iv e B a r g a in in g :
A c c id e n t and S ic k n e s s B e n e fits , F a ll 1958,
B L S B u ll.
1250 (1 9 5 9 ).
37 F o u r p l a n s , c o v e r i n g 9 6 , 8 0 0 w o r k e r s , w e r e e x c l u d e d f r o m
t h is s tu d y
b e c a u s e t h e y p r o v i d e d f o r p a y m e n t o f d i s a b i l i t y b e n e f i t s o n l y a t a g e 6 5 . In t h e s e
p la n s , s e r v i c e w a s c r e d i t e d a f t e r t o t a l a n d p e r m a n e n t d i s a b i l i t y u n t il a g e 6 5 , w h e n
t h e n o r m a l b e n e f i t w a s p a y a b l e . In o t h e r w o r d s , t h e s e p l a n s h a d n o r e g u l a r d i s
a b i l i t y b e n e f i t ; t h e y m e r e l y i n c l u d e d p e r i o d s o f d i s a b i l i t y in t h e i r d e f i n i t i o n s o f
c r e d it e d s e r v ic e f o r n o r m a l r e tir e m e n t.
38 T o t a l e a r n i n g s w e r e u s e d b y s o m e p l a n s i n s t e a d o f t h e p r o d u c t o f a v
e r a g e e a r n in g s a n d y e a r s o f s e r v i c e . O t h e r p la n s u s e d th e s u m o f th e p r o d u c t s
o f e a c h y e a r * s e a r n i n g s a n d a p e r c e n t a g e f a c t o r o r f a c t o r s . ( S e e p a g e s 8—9 . )
39 S e e p a g e 6 .
40 H i g h e r b e n e f i t s w e r e p a y a b l e e f f e c t i v e J a n u a r y 1, I 9 6 0 . ( S e e f o o t n o t e s 13
a n d 1 7 .)
41 In w o r k m e n ^ c o m p e n s a t i o n c a s e s , t h e a c t u a l a m o u n t o f t h e b e n e f i t w o u l d
b e d e d u c t e d i f s o c i a l s e c u r i t y b e n e fit s w e r e l e s s th a n $ 8 5 a m o n th .
37
D e d u c tio n o f S o c ia l S e c u r ity D is a b ilit y B e n e fit s . — T w o ou t o f 5 r e t i r e
m e n t p la n s p r o v i d i n g f o r d i s a b i l i t y r e t i r e m e n t (8 9 ), c o v e r i n g a b o u t th e s a m e
p r o p o r t i o n o f w o r k e r s , w e r e in t e g r a t e d w ith th e s o c i a l s e c u r i t y d i s a b i l i t y b e n e fit s
b y th e o f f s e t m e t h o d , th a t i s , b y d e d u c t in g a ll o r p a r t o f th e p u b l i c b e n e f it f r o m
t h e a m o u n t c a l c u l a t e d b y t h e b e n e f i t f o r m u l a ( t a b l e 3 6 ) . 42
T h e e n tir e s o c ia l s e
c u r i t y b e n e f i t w a s d e d u c t e d b y 33 o f t h e 8 9 p l a n s in t h i s g r o u p a n d h a l f o f t h e
b e n e fit w a s d e d u c te d b y 12.
T h e r e m a in in g p la n s ,
e x c e p t fo r " o t h e r ," fo llo w e d
t h e i r n o r m a l r e t i r e m e n t f o r m u l a a n d d e d u c t e d $ 8 5 -----t h e m a x i m u m o l d - a g e ( p r i
m a r y ) r e t ir e m e n t b e n e fit b e tw e e n 1952 and 1954. T h u s, if s o c ia l s e c u r it y b e n e
f i t s a r e i n c r e a s e d , th e e n t ir e i n c r e a s e w o u ld b e p a s s e d a lo n g t o th e p e n s i o n e r s
b y th e la t t e r g r o u p , o n e - h a l f b y t h o s e d e d u c tin g o n e - h a l f th e b e n e f it s , a n d n o n e
b y t h o s e d e d u c tin g a ll b e n e fit s .
M o r e th a n h a lf o f th e 89 o f f s e t p la n s p r o v i d e d
a m in im u m b e n e f it d e t e r m i n e d b y a n a lt e r n a t e f o r m u l a th a t d id n o t r e q u i r e th e
d e d u c t io n o f th e s o c i a l s e c u r i t y d i s a b i l i t y b e n e fit .
R e c o m p u t a t io n o f D i s a b i l i t y B e n e f i t s . — A b o u t a t h ir d o f th e p la n s p e r
m it t in g r e t i r e m e n t f o r d i s a b i l i t y m a d e n o p r o v i s i o n f o r th e r e c o m p u t a t i o n o f
b e n e fit s .
T h e r e m a in in g p la n s r e c o m p u t e d b e n e fit s w h e n th e p e n s i o n e r r e a c h e d
a g e 65 o r , l e s s f r e q u e n t l y , w h e n h e r e a c h e d 65 o r b e c a m e e l i g i b l e f o r o r r e
c e i v e d d i s a b i l i t y b e n e fit s o r p r i m a r y o l d - a g e b e n e fit s u n d e r th e S o c i a l S e c u r it y
A ct.
T h e r e c o m p u t e d b e n e f i t w a s a l m o s t a l w a y s b a s e d in w h o l e o r in p a r t o n
th e n o r m a l r e t i r e m e n t f o r m u l a .
T h e p e r io d o f d is a b ilit y w as n ot c r e d it e d as
s e r v ic e f o r p u r p o s e s o f r e c o m p u ta tio n .
T h e e v e n ts r e q u ir i n g th e r e c o m p u t a t io n
o f b e n e fit s a n d th e ty p e o f b e n e f it p a id a ft e r r e c o m p u t a t io n a r e s u m m a r i z e d b e lo w :
P la n s
W ork ers
(th o u s a n d s )
A l l p l a n s w i t h d i s a b i l i t y r e t i r e m e n t ________________
219
3 ,2 1 9 .7
W it h r e c o m p u t a t i o n _____________________________________
A t a g e 6 5 _______________________________________________
N o r m a l b e n e f i t p a y a b l e t h e r e a f t e r __________
O t h e r b e n e f i t p a y a b l e t h e r e a f t e r ____________
A t a g e 65, o r u p on b e c o m in g e lig ib le fo r
o r r e c e iv in g s o c ia l s e c u r it y d is a b ilit y
o r p r i m a r y b e n e f i t ________________________________
N o r m a l b e n e f i t p a y a b l e t h e r e a f t e r __________
O t h e r b e n e f i t p a y a b l e t h e r e a f t e r ____________
W it h o u t r e c o m p u t a t i o n _________________________________
148
101
96
5
2, 1 6 6 .4
1, 2 4 4 . 2
1, 2 0 4 . 3
3 9 .9
47
43
4
71
9 2 2 .2
9 0 4 .0
1 8 .2
1 ,0 5 3 .3
L e v e l o f B e n e f i t s . ----- T o a s c e r t a i n t h e l e v e l o f b e n e f i t s r e l a t i v e t o p r e v i o u s
e a r n in g s a n d to c o m p a r e th e m o n t h ly b e n e f it a m o u n ts p r o v i d e d b y th e p la n s s t u d ie d ,
d is a b ilit y r e t ir e m e n t b e n e fit s w e r e c o m p u te d u n d e r c e r t a in u n ifo r m a s s u m p tio n s
s i m i l a r t o t h o s e u s e d in c o m p u t i n g n o r m a l r e t i r e m e n t b e n e f i t s . T h e s e a s s u m p
tio n s a r e :
1.
R e t ir e m e n t a t a g e 50— th e e a r l i e s t a g e a t w h ic h s o c i a l s e c u r i t y d i s
a b i l i t y b e n e f i t s w e r e p a y a b l e in 1 9 5 9 . ( O n l y 2 6 p l a n s w e r e e x c l u d e d b e c a u s e
th e y h a d a h ig h e r m in im u m a g e r e q u ir e m e n t . )
g ra te
42
b e n e fits
S e e p a g e s 6—8 .
T he o ffs e t m eth od
w i t h w o r k m e n 1s c o m p e n s a t i o n .
w as
a ls o
u s e d b y s o m e p la n s to in t e
38
2.
T w e n t y y e a r s o f f u t u r e c r e d i t e d s e r v i c e 43— a n a r b i t r a r y b a s i s
d e te r m in in g s e r v ic e c r e d it s f o r a w o r k e r w h o b e c o m e s d is a b le d at a g e
(O n ly t h r e e p la n s h a d a lo n g e r m in im u m s e r v i c e r e q u ir e m e n t . )
fo r
50.
3.
A n n u a l e a r n in g s o f $ 4 , 800— th e m a x im u m
e a r n i n g s u s e d in d e t e r
m in in g b e n e f it s u n d e r th e S o c i a l S e c u r i t y A c t .
T h e y w e r e a s s u m e d to b e
c o n s ta n t f o r a ll s e r v i c e u s e d to c o m p u te p u b lic o r p r iv a t e b e n e fit s .
4.
b e n e fits
E lig ib ility
($ 1 2 7 p e r
f o r and r e c e ip t o f m a x im u m
s o c ia l
m o n t h a t th e t im e o f th e s t u d y ).
s e c u r ity
d is a b ilit y
N o b e n e fit a m o u n t w a s c o m p u t e d f o r 4 2 p la n s r e p r e s e n t in g a b o u t 5 3 0 , 0 0 0
w o r k e r s . In a d d i t i o n t o t h e 2 9 p l a n s t h a t d i d n o t p a y d i s a b i l i t y b e n e f i t s t o w o r k e r s
a g e d 5 0 w i t h 20 y e a r s o f s e r v i c e (t h e a s s u m e d m i n i m u m
r e q u i r e m e n t s o f t h is
s t u d y ) t h e r e m a i n i n g 13 p l a n s c o n t a i n e d f o r m u l a s t h a t c o u l d n o t b e c a l c u l a t e d —
u s u a l l y b e c a u s e o f a n a c t u a r i a l r e d u c t i o n o f u n s p e c i f i e d s i z e . 44
A l m o s t h a lf th e c o m p u t e d p la n s (8 7 ), c o v e r i n g a b o u t t h r e e o u t o f f i v e
w o r k e r s , w o u ld p r o v id e a d is a b ilit y p e n s io n b e n e fit o f $ 5 0 p e r m o n th ( $ 2 . 5 0 a
m o n th f o r e a c h y e a r o f s e r v ic e , e x c lu s iv e o f s o c ia l s e c u r it y d is a b ilit y b e n e fits )
u n d e r th e a s s u m e d c o n d it io n s (t a b le 3 7 ). V ir t u a ll y a ll o f t h e s e p la n s w e r e n o n
c o n t r i b u t o r y , s i n g l e - e m p l o y e r p l a n s in m a n u f a c t u r i n g i n d u s t r i e s . A p p r o x i m a t e l y
a fo u r t h o f th e p la n s , c o v e r i n g n e a r l y a fi ft h o f th e w o r k e r s , w o u ld p r o v i d e $ 6 0
o r m o r e a m o n t h ; a n d a lik e p r o p o r t i o n o f p la n s c o v e r i n g a b o u t a s ix t h o f th e
w o r k e r s w o u l d p a y l e s s t h a n $ 5 0 . 45
T h e w e ig h te d a v e r a g e c o m p u te d d is a b ilit y
b e n e f i t p a y a b l e b y t h e p l a n s w a s $ 5 4 . 4 8 . 46
T h e w e ig h te d a v e r a g e m o n th ly b e n e fit ,
in c lu d in g th e m a x im u m s o c i a l
s e c u r it y d is a b ilit y b e n e fit o f $ 1 2 7 ,
th u s w o u ld a m o u n t t o $ 1 8 1 .4 8 , o r a b o u t
45 p e r c e n t o f th e a s s u m e d $ 4 0 G - a - m o n t h e a r n in g s l e v e l ( g r o s s ) .
T he to ta l
m o n th ly b e n e fit a m o u n ts w o u ld r a n g e f r o m
l e s s th a n a t h ir d ( s o c i a l s e c u r i t y
a lo n e ) to t w o -t h ir d s o f p r e r e t i r e m e n t g r o s s e a r n in g s (t a b le 3 8 ).
O ne out o f s ix
p la n s w o u ld p r o v id e at le a s t 50 p e r c e n t o f p r e r e t i r e m e n t e a r n in g s , th a t i s , at
le a s t $ 2 0 0 a m o n th .
T w e n t y o f t h e s e p l a n s w e r e n o n c o n t r i b u t o r y a n d 13 w e r e
c o n t r i b u t o r y — a f a r h ig h e r p r o p o r t i o n o f th e l a t t e r g r o u p th a n o f th e f o r m e r .
T h e s a m e d is a b ilit y and n o r m a l r e t ir e m e n t b e n e fit a m o u n ts , e it h e r in
c lu d in g o r e x c lu d in g th e $ 1 2 7 s o c i a l s e c u r i t y b e n e f it , w o u ld b e p a y a b le t o w o r k
e r s w i t h 20 y e a r s o f f u t u r e s e r v i c e a n d a v e r a g e a n n u a l e a r n i n g s o f $ 4 , 8 0 0 b y
t h r e e - f o u r t h s o f th e 174 p la n s f o r w h ic h b o t h b e n e f it s w e r e c o m p u t a b l e .
In a l l
b u t a f e w c a s e s , th e s a m e b e n e f it w a s c o m p u t e d b e c a u s e th e s a m e f o r m u l a w a s
u s e d . T w o - t h i r d s o f t h e p l a n s in w h i c h b e n e f i t l e v e l s d i f f e r e d p a i d h i g h e r n o r m a l
r e t ir e m e n t b e n e fit s and a t h ir d p r o v id e d l a r g e r d is a b ilit y b e n e fit s .
43 F o r t h e s i g n i f i c a n c e o f u s i n g f u t u r e s e r v i c e , s e e p a g e 1 1 .
44 N o a c c o u n t w a s t a k e n o f w o r k m e n ^ c o m p e n s a t i o n b e n e f i t s w h i c h m a y , u n d e r
o n e o f t h e a l t e r n a t e f o r m u l a s in s o m e p l a n s , b e d e d u c t e d f r o m
th e p l a n b e n e f i t s .
45 T h i r t e e n p l a n s , c o v e r i n g a b o u t 6 p e r c e n t o f t h e w o r k e r s , w o u l d p r o v i d e n o
b e n e fit u n d e r th e a s s u m e d c o n d it io n s b e c a u s e o f a s o c i a l s e c u r i t y d i s a b i l i t y b e n e fit
o ffs e t.
T h e s e p l a n s d o , h o w e v e r , p a y b e n e f i t s t o w o r k e r s e n t i t l e d t o l e s s th a n
m a x im u m s o c ia l s e c u r it y b e n e fit s .
46 W e i g h t e d b y t h e n u m b e r o f w o r k e r s c o v e r e d .
39
W o r k e r s q u a lify in g f o r d is a b ilit y b e n e fit s u n d e r a c o l l e c t i v e l y b a r g a in e d
p e n s io n p la n d o n o t n e c e s s a r i l y q u a lify f o r s o c i a l s e c u r it y d is a b ilit y b e n e fit s . T o
a s c e r t a i n th e l e v e l o f b e n e f it s a n d r e l a t i v e a m o u n ts p r o v i d e d t h o s e w h o f a i l to
q u a lify f o r s o c i a l s e c u r i t y b e n e f it s , th e b e n e fit s p r o m i s e d b y p r iv a t e p la n s w e r e
c o m p u t e d u s i n g t h e s a m e a s s u m p t i o n s a s w e r e p r e v i o u s l y u s e d , 47 e x c e p t , o f
c o u r s e , th e a s s u m p t io n r e g a r d in g s o c i a l s e c u r i t y b e n e f it s .
T h e w e ig h te d a v e r
a g e b e n e f i t s o c o m p u t e d w a s $ 9 0 . 9 5 -----a b o u t t w o - t h i r d s h i g h e r th a n t h e a v e r a g e
a m o u n t p r o v i d e d b y th e s a m e p la n s to r e t i r e e s e l i g i b l e f o r s o c i a l s e c u r i t y d i s
a b i l i t y b e n e f it s a n d a b o u t h a lf th e a v e r a g e a m o u n t o f s o c i a l s e c u r i t y a n d p r i v a t e
p la n b e n e fit s c o m b in e d .
O f 177 p la n s f o r w h ic h b e n e f it s w e r e c o m p u t e d , 123 p r o v i d e d a h ig h e r
b e n e fit to d is a b le d p e n s io n e r s n o t r e c e iv i n g s o c i a l s e c u r it y d is a b ilit y b e n e fit s .
T h e l a r g e s t d i f f e r e n t i a l s w e r e p r o m i s e d b y th e s m a l l g r o u p o f p la n s w h ic h w o u ld
p a y th e r e t i r e e th e s o c i a l s e c u r i t y d i s a b i l i t y b e n e f it ( $ 1 2 7 a m o n t h u n d e r th e
a s s u m e d c o n d itio n s ).
A
l a r g e n u m b e r o f p l a n s , i n c l u d i n g m o s t o f t h o s e in th e
a u t o m o b i le a n d r u b b e r i n d u s t r i e s , p r o v i d e d t w ic e th e u s u a l d i s a b i l i t y b e n e fit s
(e . g . , $ 5 a m o n th f o r e a c h y e a r o f s e r v i c e in s te a d o f $ 2 .5 0 ) .
A n o th e r la r g e
g r o u p o f p la n s f o l l o w e d th e p a t t e r n o f th e b a s i c s t e e l in d u s t r y w h ic h p r o v i d e d a
m in im u m b e n e f it o f $ 9 0 a m o n t h in s t e a d o f $ 2 . 50 a m o n t h f o r e a c h y e a r o f s e r v
i c e ( i . e . , $ 5 0 a m o n t h u n d e r th e a s s u m e d c o n d i t i o n s ) . A l m o s t a l l t h e 1 7 7 p l a n s
w o u ld r e c o m p u t e b e n e fit s w h e n th e r e t i r e e b e c o m e s e l i g i b l e f o r n o r m a l r e t i r e
m e n t b e n e f i t s -----a g e 65 in a l m o s t a l l p l a n s .
B e c a u s e o f t h e l a r g e n u m b e r o f p l a n s in t h e s e t h r e e i n d u s t r i e s ( s t e e l ,
a u t o m o b ile , a n d r u b b e r m a n u fa c tu r in g ) a n d b e c a u s e o f t h e ir in flu e n c e o n o t h e r
c o l l e c t i v e l y b a r g a in e d p la n s , h a lf th e p la n s , c o v e r i n g o v e r t h r e e - f i f t h s o f th e
w o r k e r s , w o u ld p a y $ 9 0 o r $ 1 0 0 a m o n t h u n d e r th e a s s u m e d c o n d it io n s to d i s
a b le d w o r k e r s n o t e li g ib le f o r s o c i a l s e c u r i t y d is a b i lit y b e n e fit s (t a b le 3 9 ). T h e s e
a r e , f o r th e m o s t p a r t , th e s a m e p la n s th a t a c c o u n t f o r th e c o n c e n t r a t i o n o f
p la n s p r o v id in g $ 5 0 a m o n th to t h o s e r e c e iv i n g a p u b lic b e n e fit .
47
See p a g e s 37—38.
40
T a b le 24.
P r o v is io n s f o r e a r ly and d is a b ilit y r e t ir e m e n t in s e le c t e d p e n s io n p la n s under c o ll e c t iv e b a rg a in in g
b y m e th o d o f fin a n c in g and type o f b a r g a in in g unit, fa ll 1959
(W o r k e r s in th ou san d s)
A ll plan s
P r o v is io n s
N o n c o n trib u to r y
C o n tr ib u to r y
--------- KEUtT---------e m p lo y e r
W ork
P la n s
ers
W ork ers
P lan s
W ork
ers
300
4 ,6 7 2 .7
251
3 , 9 0 1 .9
49
770. 8
231
2 ,9 4 6 . 4
69
W ith p r o v is io n s f o r d is a b ilit y a n d /o r
e a r ly r e t ir e m e n t
D is a b ility and e a r ly r e t i r e m e n t ______
D is a b ility r e t ir e m e n t on ly ___________
E a r ly r e t ir e m e n t o n ly ________________
268
175
44
49
3 ,6 0 1 . 5
2 ,6 4 9 . 8
5 6 9 .9
381. 8
220
1 148
42
4 30
3 , 1 3 0 .7
2, 296. 9
566. 9
266. 9
48
27
2
19
470. 8
352. 9
3 .0
114. 9
226
2 165
20
41
2 ,9 3 6 .9
2 ,4 6 6 . 1
1 3 7 .0
333. 8
42
3 10
24
48
664.
183.
432 .
48 .
W ithout p r o v is io n s f o r d is a b ility o r
e a r ly r e t ir e m e n t (n o r m a l r e t i r e
m en t on ly) _______________________________
32
1 ,0 7 1 .2
31
7 7 1 .2
1
3 0 0 .0
5
9. 5
27
1 ,0 6 1 . 7
A ll p lan s stu d ied
.
.
P la n s
W ork
ers
Single
e m p lo y e r
W ork
P la n s
ers
N um
ber
_____
1
2
3
4
E x clu d e s
E x clu d e s
E x clu d e s
E x clu d e s
9
3
6
3
p la n s ,
p la n s ,
p la n s ,
p la n s ,
c o v e r in g 2 5 2 ,5 0 0 w o r k e r s , that c o n ta in e d e a r ly r e t ir e m e n t p r o v is io n s f o r w o m e n o n ly.
c o v e r in g 1 5 ,9 0 0 w o r k e r s , that c o n ta in e d e a r ly r e t ir e m e n t p r o v is io n s f o r w o m e n o n ly .
c o v e r in g 2 3 6 ,6 0 0 w o r k e r s , that c o n ta in e d e a r ly r e t ir e m e n t p r o v is io n s f o r w o m e n on ly.
c o v e r in g 9 7 ,2 0 0 w o r k e r s , that c o n ta in e d e a r ly r e t ir e m e n t p r o v is io n s f o r w o m e n o n ly.
1 ,7 2 6 .3
6
7
9
0
Table 25.
Provisions for early retirem ent in selected pension plans under collective bargaining
method of financing, and type of bargaining unit, fall 1959
by industry group,
(W orkers in thousands)
N o n c o n trib u to r y
A ll plans
n us r y g ro u p
P lans
W o rk er s
W o rk er s
P la n s
3 ,0 3 1 .6
76
1 ,6 4 1 .1
251
3 ,9 0 1 .9
178
2 ,5 6 3 .8
73
189 2 ,6 7 5 . 6
40
5 3 4 .0
195
2 , 8 2 1 .1
155
2 ,2 8 7 .1
2
1
2
1 1 .3
4 .6
2 2 .6
11
3
7
1 5 6 .6
2 6 .1
3 0 .4
9
2
5
1 4 5 .3
2 1 .5
7 .8
9
3 2 5 .9
9
3 2 5 .9
M anufacturin g ------------------------
229
3 ,2 0 9 .6
17
3
8
185 .0
2 6 .1
3 9 .4
9
3 2 5 .9
3
4
9
2 3 .1
4 2 .7
5 0.1
5
13
16.2
121.1
9
See footnotes at end of table.
W o rk
ers
W ork
ers
F o o d and k in d re d p r o d u c t s -------------T o b a c c o m a n u fa ctu re s _____________
T e x tile m ill p r o d u c t s ----------------------A p p a r e l and o th er fin is h e d te x tile
p r o d u c t s -----------------------------------------------------L u m b e r and w o o d p r o d u c ts ,
e x c e p t fu r n itu r e __________________
F u rn itu re and fix tu r e s _____________
P a p e r and a llie d p r o d u c t s ------------------P r in tin g , p u b lish in g, and a llie d
i n d u s t r ie s -------------------------------------------------C h e m ic a ls and a llie d p r o d u c t s --------P e t r o le u m re fin in g and r e la te d
in d u s tr ie s
----------------- _ __________
R u b b er and m is c e lla n e o u s p la s tic s
p r o d u c t s ----------------------------------------------------L e a th e r and le a th e r p r o d u c t s _______
Ston e, clay, and g la s s p r o d u c ts ------P r im a r y m e ta l in d u s tr ie s _____________
F a b r ic a t e d m e ta l p ro d u cts __________
M a c h in e r y , e x c e p t e l e c t r i c a l _______
E l e c t r ic a l m a c h in e r y , equipm ent,
and su p p lie s -------------------------------------------T r a n sp o rta tio n equipm ent ___________
In stru m en ts and r e la te d p ro d u cts ___
M is c e lla n e o u s m an u factu rin g
in d u s tr ie s _______________________________
M in in g , cr u d e p e tr o le u m and
natu ral gas p r o d u c t i o n ______________
C o n tra ct c o n s tr u c tio n ______________
T ra n sp o rta tio n 2 _________________________
C o m m u n ica tio n s ____________________
U tilitie s : E l e c t r ic and gas ________
W h o le s a le and r e t a il t r a d e _________
H otels and r e s ta u r a n ts ____________
S e r v i c e s ______________________________
M is c e lla n e o u s non m an u fa ctu rin g
in d u s tr ie s _______________________________
nf 2 I
C on tr ib u to r y
W ithout e a r ly
r e tir e m e n t
P lan s
4, 6 7 2 . 7 1224
N on m anufacturing ______________
T
W ith e a r ly
r e t ir e m e n t
W orker s
Plans
300
A ll plans studied ________________________
W ithout e a r ly
r e tir e m e n t
With e a r ly
r e tir e m e n t
15
2
6
-
1 7 3 .7
2 1 .5
1 6 .8
-
-
-
W ork
ers
P lan s
W ork
ers
P lan s
W ork
ers
1 ,3 3 8 .1
49
7 7 0 .8
46
4 6 7 .8
40
5 3 4 .0
34
3 8 8 .5
34
3 8 8 .5
2
1
2
1 1 .3
4 .6
2 2 .6
6
2 8 .4
6
2 8 .4
9
3 2 5 .9
P la n s
W ithout e a r ly
r e t ir e m e n t
P lan s
3
W ork
ers
3 0 3 .0
_
_
-
-
-
-
1
9 .0
1
9 .0
-
-
-
-
-
-
-
-
-
-
-
-
-
-
3 9 .2
4 .5
3
4
5
2 3 .1
4 2 .7
17. 1
3
2
4
2 3 .1
3 .5
1 2 .6
2
1
3 9 .2
4 .5
3
3
1 0 .6
3 3 .3
5
12
16.2
1 1 9 .6
2
9
5 .6
8 6 .3
3
3
1 0 .6
3 3 .3
-
-
-
-
1
1 .5
1
1 .5
-
1
1.1
8
8 0 .6
8
8 0 .6
-
-
-
-
-
-
-
-
8
2 3 .1
3 .5
4 5 .6
2
1
2
10
5 .6
8 7 .8
3
2
P lan s
With e a r ly
r e t ir e m e n t
T nto 1
-
8 1 .7
8
8 0 .6
1
1 .1
8
4
10
33
13
28
106 .9
4 0 .3
7 4 .4
5 8 8 .3
113 .0
2 0 1 .2
8
1
8
33
13
24
10 6 .9
3 .5
5 6 .0
5 8 8 .3
1 13 .0
19 4 .7
_
-
16
24
4
3 1 6 .3
8 0 5 .0
1 9 .4
14
23
4
3 0 9 .4
8 0 2 .0
1 9 .4
3
2
3 6 .8
1 8 .4
-
-
4
6 .5
2
1
6 .9
3 .0
-
-
1
l.i
-
_
8
4
10
32
13
26
106. 9
40. 3
7 4 .4
571. 9
113. 0
1 8 4 .4
8
1
8
32
13
22
1 0 6 .9
3 .5
5 6 .0
5 7 1 .9
1 1 3 .0
1 7 7 .9
11
20
2
163. 0
759. 2
15. 7
9
19
2
156. 1
7 5 6 .2
1 5 .7
33. 5
-
3
2
-
-
3 6 .8
1 8 .4
-
4
-
1 6 .4
4
-
-
-
-
2
1 6 .8
2
1 6 .8
-
-
2
1
6 .9
3 .0
-
5
4
2
1 5 3 .3
4 5 .8
3 .7
5
4
2
1 5 3 .3
4 5 .8
3 .7
-
-
9
3 3 .5
5
2 4 .2
4
9 .3
9
5
2 4 .2
4
9 .3
-
1 ,4 6 3 .1
35
3 5 6 .0
36
1 ,1 0 7 .1
56
1 ,0 8 0 .8
23
2 7 6 .7
33
8 0 4 .1
15
3 8 2 .3
12
6
12
17
4
14
8
2
4
2 2 1 .6
4 0 5 .0
4 6 8 .2
153 .2
6 4 .3
5 0 .1
3 9 .0
3 1 .7
4
1
7
3
13
4
21. 6
1 .4
7 8 .9
1 23 .0
6 2 .8
3 8 .4
2 0 0 .0
4 0 3 .6
3 8 9 .3
3 0 .2
1 .5
1 1 .7
3 9 .0
2 2 .8
5
11
11
4
9
8
2
4
2 1 8 .0
1 0 5 .0
4 3 5 .0
1 5 3 .2
3 9 .8
5 0 .1
3 9 .0
3 1 .7
3
1
3
3
8
4
1 8 .0
1 .4
4 8 .7
1 2 3 .0
3 8 .3
3 8 .4
2
10
8
1
1
4
2
3
2 0 0 .0
1 0 3 .6
3 8 6 .3
3 0 .2
1 .5
1 1 .7
3 9 .0
2 2 .8
1
1
6
3 .6
3 0 0 .0
3 3 .2
4
-
4
3 0 .0
9 .0
2
9 .0
2
9 .0
2
-
-
1
8 .9
2
2 1 .0
2
-
-
1
8 .9
1 6 .4
-
6 .5
71
2
11
10
1
1
4
2
3
-
-
-
1
3 3 .0
4
-
1
3 3 .0
-
5
-
“
1
-
-
7 9 .3
-
-
-
-
"
3
3. 6
-
-
1
2
3 0 .2
3 0 3 .0
-
3 0 0 .0
3 .0
-
-
-
-
24. 5
-
5
-
24. 5
-
-
-
-
-
-
-
2 1 .0
-
2
-
2 1 .0
-
T a ble 25.
P r o v is io n s fo r e a r ly r e t ir e m e n t in s e le c t e d p e n s io n p la n s u nd er c o ll e c t iv e b a rg a in in g
m ethod o f fin a n cin g , and type o f b a rg a in in g unit, fa ll 1959— C on tinued
by in d u stry g r o u p ,
(W o r k e r s in thousand s)
M u ltiem p loy e r
Single e m p lo y e r
Total
In du stry grou p
A ll plans stu died ____ _____ __ __
M anufacturin g
F o o d and k in d re d p r o d u c ts
T o b a c c o m a n u f a c t u r e s _____________
T e x tile m ill p r o d u c ts ______________
A p p a re l and o th e r fin is h e d te x tile
p r o d u c ts __ __ _____ _____ ______
L u m b e r and w o o d p r o d u c t s ,
e x c e p t fu rn itu re
_ _
F u rn itu re and fix tu r e s ____________
P a p e r and a llie d p r o d u c ts _________
P r in tin g , p u b lis h in g , and a llie d
in d u s tr ie s
___
C h e m ic a ls and a llie d p r o d u c t s _____
P e t r o le u m re fin in g and r e la te d
in d u s tr ie s ______ ________ __ ___
R u bber and m is c e lla n e o u s p la s t ic s
p r o d u c t s _________ ________ ______
L e a th e r and le a th e r p r o d u c t s _____
Stone, c la y , and g la s s p r o d u c t s ___
P r im a r y m e ta l in d u s tr ie s _
F a b r ic a te d m e ta l p r o d u c ts _ _
M a ch in e ry , e x c e p t e l e c t r i c a l _____
E le c t r ic a l m a c h in e r y , equ ipm en t,
and s u p p lie s _ __ __ __ __________
T r a n sp o rta tio n e q u i p m e n t _________
In stru m en ts and r e la te d
p r o d u c ts
M is c e lla n e o u s m an u factu rin g
in d u s tr ie s ___ ________ __ ______
N onm anuf ac tur ing
M ining, c r u d e p e tr o le u m and
natu ral gas p r o d u c tio n ___________
C o n tra ct c o n s t r u c tio n .. . _
T r a n s p o r t a t io n 2 _
_ _
C o m m u n ica tio n s
U tilitie s : E le c t r ic and gas ________
W h o le sa le and r e t a il trad e ________
H otels and r e s ta u r a n ts
S e r v ic e s
M is c e lla n e o u s non m an u fa ctu rin g
in d u s tr ie s
___
W ithout e a r ly
r e t ir e m e n t
W ith e a r ly
r e t ir e m e n t
P la n s
W ith e a r ly
r e t ir e m e n t
T otal
P la n s
W orkers
P la n s
P lan s
W orkers
P la n s
W orkers
231
2 ,9 4 6 .4
206
2 ,7 9 9 .9
25
1 46 .5
69
1 ,7 2 6 .3
18
197
2 ,6 3 9 .8
180
2 ,5 4 1 . 3
17
9 8 .5
32
569. 8
12
3
6
70. 2
26. 1
16. 8
12
2
6
70. 2
21. 5
16. 8
.
1
-
4 .6
-
5
2
114. 8
22. 6
1
1. 3
-
-
1
1. 3
8
324. 6
-
-
1
3
1
9 .4
40. 7
4. 5
4
-
1 1 .9
-
W orkers
_
W ithout e a r ly
r e t ir e m e n t
W orkers
P la n s
W orkers
231. 7
51
1 ,4 9 4 . 6
9
134. 3
23
4 3 5 .5
3
-
103. 5
-
2'
2
11. 3
22. 6
-
8
324. 6
1
1
-
9 .4
1 .5
-
2
1
3 9 .2
4. 5
1
-
1. 3
-
3
-
10. 6
_
2
1
8
13. 7
2. 0
45. 6
2
1
8
13. 7
2. 0
45. 6
-
1
13
4. 3
121. 1
1
10
4. 3
87. 8
3
33. 3
9
8 1 .7
8
1
1. 1
-
-
-
-
-
-
8
3
10
33
13
27
106. 9
30. 3
7 4 .4
588. 3
113. 0
194. 7
8
1
8
33
13
23
106.
3.
56.
588.
113.
188.
9
5
0
3
0
2
2
2
4
26. 8
1 8 .4
6. 5
1
1
10. 0
6. 5
1
6. 5
1
-
10. 0
-
14
24
3 0 9 .4
805. 0
14
23
3 0 9 .4
802. 0
1
3 .0
2
-
6. 9
-
-
-
2
-
6 .9
-
4
1 9 .4
4
1 9 .4
-
-
-
-
-
-
-
-
5
15. 6
3
12. 1
2
3. 5
4
17. 9
2
12. 1
2
5. 8
34
306. 6
26
2 5 8 .6
8
48. 0
37
1 ,1 5 6 . 5
9
9 7 .4
28
1 ,0 5 9 . 1
4
10
4
14
-
2 1 .6
46. 5
153. 2
64. 3
-
4
-
-
_
6
1
1
-
-
4
3
13
-
2 1 .6
30. 2
1 2 3 .0
62. 8
-
2
12
7
-
200. 0
405. 0
421. 7
_
2
11
4
200. 0
4 0 3 .6
373. 0
2
21. 0
2
21. 0
-
80. 6
1 E x clu d e s 12 plans c o v e r in g 3 4 9 ,7 0 0 w o r k e r s in w hich on ly w o m e n c o u ld r e t ir e e a r ly .
2 E x clu d e s r a ilr o a d and a ir lin e in d u s tr ie s .
16. 3
30. 2
1. 5
-
-
-
1
3
-
-
-
-
8
2
4
50. 1
39. 0
31. 7
4
1
2
9 .0
-
1 .4
48. 7
3 8 .4
8 .9
-
-
-
-
4
2
3
11. 7
39. 0
22. 8
2
9 .0
43
T a b le 2 6 .
P r e p a r t ic ip a t io n r e q u ir e m e n ts not c r e d it e d a s s e r v ic e f o r e lig ib ilit y f o r e a r ly r e t ir e m e n t , f a ll 1959 1
(W o r k e r s in th o u sa n d s)
M in im u m age r e q u ir e m e n ts 2
A ll plans
M in im u m s e r v ic e r e q u ir e m e n t
N um
ber
W ork
ers
N o age
r e q u ir e m e n t
P la n s
A g e 25
A g e 30
W ork
ers
P la n s
W ork
ers
7
3 8 .5
42
2
6 .0
8 .1
A ll plans w ith p r e p a r t ic ip a t io n r e q u i r e
m en ts n ot c r e d it e d fo r e a r ly
r e t ir e m e n t 3 ______________________________
43
3 8 3 .5
22
2 2 0 .3
N o s e r v ic e r e q u i r e m e n t ___________________
1 y e a r o f s e r v ic e ___________________________
2 y e a r s o f s e r v i c e __________________________
3 y e a r s o f s e r v i c e ---------------------------------------5 y e a r s o f s e r v ic e _________________________
7
18
3
8
7
2 5 .6
1 9 7 .0
3 3 .8
7 5 .9
5 1 .2
14
1
5
2
1 8 4 .8
1 6 .4
1 1 .4
7 .7
-
1
62
_
5 .4
1 9 .0
Ag<s 35
W ork
ers
P la n s
11
1 0 8 .3
3
1 6 .4
3
2
2
2
2
5 .4
4. 1
1 7 .4
5 9 .1
2 2 .3
52
1 4 .2
P la n s
_
W ork
ers
_
_
-
-
1
2 .2
1 B a s e d on a study o f 300 s e le c t e d p e n s io n plans under c o ll e c t iv e b a rg a in in g c o v e r in g a p p r o x im a t e ly 4 ,6 7 0 ,0 0 0 w o r k e r s .
2 A g e r e q u ir e m e n ts w e r e 5 y e a r s e a r l ie r f o r w o m e n in 2 plans c o v e r in g 1 4 ,0 0 0 w o r k e r s .
3 P r e p a r t ic ip a tio n r e q u ir e m e n ts w e r e found in 72 o f the plans s tu d ie d , c o v e r in g 6 2 2 ,1 0 0 w o r k e r s .
O f t h e s e , 5 plan s
c o v e r in g 2 6 ,0 0 0 w o r k e r s did not p r o v id e fo r e a r ly r e t ir e m e n t ; 24 plans c o v e r in g 2 1 2 ,6 0 0 w o r k e r s c r e d it e d the w o r k e r w ith
p r e p a r t ic ip a t io n y e a r s o f s e r v ic e f o r the p u r p o s e o f d e te r m in in g e lig ib ilit y .
P r e p a r t ic ip a t io n r e q u ir e m e n ts in the re m a in in g
43 p lan s a r e show n in this t a b le .
4 In clu d e s 1 plan , c o v e r in g 2 ,0 0 0 w o r k e r s , that stip u la te d age 2 1 .
5 In clu d e s 1 p la n , c o v e r in g 8 ,9 0 0 w o r k e r s , that stip u la te d a ge 4 0 .
6 In clu d e s 1 plan , c o v e r in g 1 0 ,0 0 0 w o r k e r s , that p r o v id e d an a lte rn a tiv e r e q u ir e m e n t o f a g e 31 and 1 y e a r o f s e r v i c e .
44
T a b le 27.
M in im u m r e q u ir e m e n ts f o r e a r ly r e t ir e m e n t b y c o n s e n t r e q u ir e d , fa ll 1959
(W o r k e r s in th ou san d s)
C o n se n t r e q u ir e d
A t w o r k e r 's s r e q u e s t
e m p lo y e r 's i co n s e n t:
A ll plans
M in im u m r e q u ir e m e n ts 2
N ot re q u ir e d
N um
ber
W ork
ers
P lan s
W ork
ers
P la n s p r o v id in g f o r e a r ly r e t ir e m e n t ---------------
224
3 ,0 3 1 . 6
150
2 ,2 1 4 . 5
53
S e r v ic e on ly (w ithout p r e p a r t ic ip a t io n o r
age r e q u i r e m e n t s ) -----------------------------------------------25 y e a r s -------------------------------------------------------------
1
1
1
1
2 1 .2
2T72
"
2 1 .2
2 1 .2
P a r t ic ip a tio n on ly (w ithout s e r v ic e o r
a ge r e q u i r e m e n t s ) ------------------------------------------------
2
8. 6
_
A g e 5 ------------------------------------------------------------------------A g e 50 ----------------------------------------------------------------A g e 55 ----------------------------------------------------------------A g e 60 -----------------------------------------------------------------
38
3
30
5
3 4 4 .2
5 .3
209 . 9
129. 0
11
-
-
8
3
44. 5
9 .5
A g e and s e r v i c e ------------------------------------------------------A g e 45 and 15 y e a r s ----------------------------------------A g e 55 and 5 y e a r s -----------------------------------------A g e 55 and 10 y e a r s ----------------------------------------A g e 55 and 15 y e a r s ----------------------------------------A g e 55 and 20 y e a r s ----------------------------------------A g e 55 and 25 y e a r s ----------------------------------------A g e 58 and 3 y e a r s ---- -------------------------------------A g e 60 and 5 y e a r s ------------------------------------------A g e 60 and 10 y e a r s ----------------------------------------A g e 60 and 12 y e a r s ------------------------------ ---------A g e 60 and 15 y e a r s ----------------------------------------A g e 60 and 20 y e a r s ----------------------------------------A g e 60 and 25 y e a r s ----------------------------------------A g e 60 and 30 y e a r s -----------------------------------------
155
1
2
8
14
14
1
1
1
33
1
64
12
1
2
2 ,3 0 0 . 2
4. 0
45. 4
113. 5
1 7 1 .0
165. 6
2. 0
1 3 .9
9 .4
9 0 0 .2
1 6 .2
808. 3
37. 6
3. 0
10. 1
133
1
2
5
11
11
2 ,0 9 8 . 1
4. 0
45. 4
78. 1
1 3 4 .6
137. 1
61
6
1
2
751. 1
2 0 .2
3. 0
10. 1
A g e and p a r t ic ip a t io n --------------------------------------------A g e 50 and 10 y e a r s ----------------------------------------A g e 55 and 5 y e a r s -----------------------------------------A g e 55 and 10 y e a r s ----------------------------------------A g e 55 and 15 y e a r s ----------------------------------------A g e 55 and 20 y e a r s ----------------------------------------A g e 60 and 10 y e a r s ----------------------------------------A g e 60 and 15 y e a r s -----------------------------------------
10
1
2
3
1
1
1
1
48. 1
2. 6
19. 5
8. 6
2. 3
4. 0
2 .2
8 .9
4
2 4 .2
A l t e r n a t i v e s ------------------------------------------------------------10 y e a r s o f p a r t ic ip a t io n o r age 55 and
2 5 y e a r s o f s e r v ic e -----------------------------------2 5 y e a r s o f s e r v ic e o r age 55 and
10 y e a r s of p a r t i c i p a t i o n -----------------------------30 y e a r s o f s e r v ic e o r age 55
and 5 y e a r s o f s e r v ic e ---------------------------------30 y e a r s o f s e r v ic e o r age 55
and 25 y e a r s o f s e r v i c e --------------------------------A g e 50 and 20 y e a r s o f s e r v ic e o r
a ge 55 and 10 y e a r s o f s e r v ic e -------------------A g e 50 and 20 y e a r s o f s e r v i c e , a g e 55
and 15 y e a r s o f s e r v i c e , o r a g e 6 0 ------------A g e 55 o r age 55 and 20 y e a r s
o f p a r t ic ip a t io n ---------------------------------------------A g e 55 o r age 60 and 25 y e a r s o f s e r v ic e —
A g e 55 and 15 y e a r s o f s e r v ic e o r
a ge 60 and 10 y e a r s o f s e r v ic e ------------------A g e 55 and 20 y e a r s o f s e r v ic e o r a ge 60 —
A g e 55 and 20 y e a r s o f s e r v ic e o r
a g e 60 and 20 y e a r s o f s e r v ic e ------------------A g e 55 and 25 y e a r s o f s e r v ic e o r
age 60 and 10 y e a r s o f s e r v ic e ------------------A g e 55 and 30 y e a r s o f s e r v ic e o r
age 60 and 20 y e a r s o f s e r v i c e --------------------A g e 60 and 10 y e a r s o f s e r v ic e o r
a ge 60 and 15 y e a r s o f s e r v i c e --------------------
18
309. 3
-
1
1
31
-
r\ i.u
Utn
er *
R e q u ir e d 3
_
54. 0
-
1 3 .9
9 .4
8 9 1 .2
-
P lan s
W ork
ers
P lan s
W ork
ers
475 . 7
21
3 4 1 .4
“
2
8. 6
_
25
3
21
1
1 6 4 .2
5 .3
155. 4
3. 5
2
16
148. 4
-
2
1
2
1
-
26. 4
1 .4
23. 0
2. 0
-
_
126. 0
-
1
1
10. 0
1 1 6 .0
6
53. 7
-
-
1
2
1
9 .0
35. 0
5. 5
-
-
-
-
-
-
-
-
-
-
-
1
1
3
65
6. 0
1 6 .2
5 7 .2
1 6 .2
1
3 .0
-
-
1
1 .2
-
-
-
-
-
-
"
-
2 1 .6
2. 6
7. 7
7. 3
1
2. 3
-
-
-
-
-
-
1
1
11. 8
1. 3
5
1
1
2
-
-
-
-
-
1
1
1
2 .2
8 .9
-
-
-
1
17. 0
5
-
-
-
-
-
1
2. 3
4. 0
-
-
-
-
-
1 3 2 .9
-
12
-
1 5 9 .4
2
1 8 .2
-
-
-
-
72
1 8 .2
1
3 1 .8
-
-
-
-
1
31. 8
-
-
-
-
1
3. 1
123. 0
1
3. 1
3
123. 0
-
-
3
-
-
1
3 .9
-
-
1
3 .9
-
-
1
2 .9
-
-
-
-
1
2 .9
1
1
1 1 .5
6. 0
_
_
_
_
1
1 1 .5
-
-
*
1
6. 0
2. 0
6. 1
.
_
_
_
-
-
-
2
14. 8
-
-
1
17. 0
1
17. 0
1
9. 8
-
-
1
5 9 .2
-
-
1
1
-
-
1
1
2. 0
6. 1
-
-
2
14. 8
-
-
-
-
-
-
1
9. 8
-
-
1
5 9 .2
1 B a s e d on a study o f 300 s e le c t e d p e n s io n plan s u n d e r c o ll e c t iv e b a r g a in in g c o v e r in g a p p r o x im a t e ly 4 ,6 7 0 ,0 0 0 w o r k e r s .
2 S e r v ic e r e fe r s to the p e r io d o f e m p lo y m e n t, w h e r e a s p a r t ic ip a t io n in c lu d e s p e r io d o f plan m e m b e r s h ip on ly.
P e r io d s
m a y b e id e n tic a l o r m a y v a r y if e lig ib ilit y r e q u ir e m e n ts p r i o r to m e m b e r s h ip in the plan a r e s p e c ifie d .
3 " E m p l o y e r 's c o n s e n t " in clu d e s 7 plan s w h e re e m p l o y e r 's a p p ro v a l o r e m p l o y e r 's r e q u e s t is r e q u ir e d .
4 P lan s s p e c ifie d a lte rn a tiv e co n s e n ts in v o lv in g b o th e m p lo y e r and w o r k e r o p tio n s .
5 In clu d es 28 plans c o v e r in g 3 1 8 ,9 0 0 w o r k e r s that p r o v id e d f o r s o m e p r e p a r t ic ip a t io n s e r v ic e and 2 plans w ith
3, 100 w o r k e r s s p e c ifie d a p r e p a r t ic ip a t io n age.
6 In clu d es 1 plan c o v e r in g 2 ,6 0 0 w o r k e r s that s p e c ifie d a m in im u m age o f 60, but age plus n u m b e r o f y e a r s o f s e r v ic e
m u s t equ a l 80.
7 W hen a g e and s e r v ic e a lte rn a te u s e d , in itia l age is 55, and age plus s e r v ic e m u s t equ a l 80.
45
Table 28.
Minimum age and service requirements for early retirem ent, fall 1959 1
(W orkers in thousands)
Minimum age requirem ents 3
Minimum service requirements 2
A ll plans
Num
ber
A ll plans providing for early
retirem ent ----------------------------
No service req u ire m e n t----------------------------1 year -----------------------------------------------------------2 years ----------------------------------------------------------3 years ----------------------------------------------------------5 years ----------------------------------------------------------6 years ----------------------------------------------------------7 years ----------------------------------------------------------1 0 y e a r s --------------------------------------------------------12
15
20
21
25
y e a r s --------------------------------- -----------------------y e a r s --------------------------------------------------------y e a r s --------------------------------------------------------y e a r s --------------------------------------------------------y e a r s ---------------------------------------------------------
W ork
ers
4 224
3 ,0 3 1 . 6
10
15
2
9
9
1
1
43
2
1
84
31
2
7
7
25. 3
186. 6
22. 0
89. 8
103. 8
7. 7
11. 8
1 ,0 2 1 .0
3 .9
1 6.2
1 ,0 5 7 . 9
230. 1
16. 3
9 3 .2
146. 0
No ;age
reauir<ement
W ork
Plans
ers
Ag«; 50
W ork
ers
8
187. 7
7
18. 7
1
1
3. 0
5. 6
3
5. 3
-
-
W ork
ers
Plans
W ork
ers
84
812. 4
125
2 ,0 1 2 .8
7
10
1
7
8
1
1
10
1
15. 8
6 2 .3
16. 4
7 2 .4
94. 4
7. 7
1 1 .8
120. 8
1 .3
3
1
9. 5
116. 0
Plans
-
-
-
-
-
-
-
-
-
-
-
-
1
2 .6
-
-
-
-
-
-
-
61
2
4. 0
6. 8
-
-
-
-
16
16
1
4
1
-
2
4
-
-
53. 0
126. 1
Ag<j 60
Agie 55
Plans
-
-
175. 3
175. 7
1 1 .5
3 7 .2
9. 8
-
-
s2
1
33
17. 4
9 .4
-
-
1
67
13
1
1
2
-
9 0 0 .2
-
16 .2
878. 6
47. 6
4. 8
3. 0
10. 1
1 Based on a study of 300 selected pension plans under collective bargaining covering approximately 4 ,6 7 0 ,0 0 0 w orkers.
2 For those plans which specified that a period of employment be served before participation in the plan could begin,
the minimum service requirement includes the preparticipation service and the required plan m em bership service.
3 In 20 plans, covering 3 7 5 ,9 0 0 w orkers, alternative requirements were specified; the one with the earliest age require
ment at the w orker's option is shown, or the earliest age or no age requirem ent is used if no worker option was perm itted.
Age requirements were lower for women in a number of plans:
5 years earlier in 10 plans covering 2 0 8 ,2 0 0 w orkers, and
10 years in 1 plan covering 2 ,9 0 0 w orkers.
4 Excludes 12 plans, covering 3 4 9 ,7 0 0 w orkers, in which only women could retire early.
In 9 plans, covering
3 3 3 ,4 0 0 w orkers, the minimum requirem ents were age 62 and 20 years of service; 1 plan with 1 ,3 0 0 w orkers, specified age
62 and 15 years of service; another plan covering 1 0 ,0 0 0 workers had a requirem ent of age 62 and 5 years of service; and
in the remaining plan, covering 5 ,0 0 0 w orkers, the requirement was age 62.
5 Includes 1 plan with 1 3 ,9 0 0 w orkers, that specified age 58.
6 Plan specified age 45.
46
Table 29-
Relationship of early retirem ent to norm al retirem ent benefit form ulas and
method of financing by reduction for age, fall 1959 1
Relationship of early retirem ent to
norm al retirem ent formula
and method of financing
A ll plans with early r e tir e m e n t--------------
Total
(W orkers in thousands)
Percent reduction for each month retirem ent occurs prior
to no rm al retirem ent age
None
Plans
W ork
ers
224
3,031. 6
4
199
21
1
15
1
2,62 6 .2
259. 0
3. 0
111. 7
4 .9
4
-
2
1
1
4
18 .2
120. 0
1.2
146. 4
-
178
46
2 ,5 6 3 . 8
467. 8
4
“
Actuarial
0. 625
0. 60
0. 55
Plans
W ork
ers
125. 6
132
1,227.9
7
261. 4
23
685. 8
4
16 .9
125. 6
-
122
8
7
1,191. 7
22. 8
21. 6
7
-
2 6 1 .4
-
20
3
1
1
554. 9
1 30.9
6 .0
4 .9
4
-
16 .9
-
1
-
120. 0
-
-
-
23
■
685. 8
“
4
"
Plans W ork
ers
Plans W ork
ers
Plans
W ork
ers
Plans W ork
ers
Relationship of early retirem ent to
norm al retirem ent form ula
Same as norm al benefit form ula ------------Modified norm al benefit fo rm u la ------------Service limitations of 25 y e a r s ---------Minimum not applicable ---------------------B asic not applicable ----------------------------Minimum based on service not
ap p licable--------------------------------------------With supplement -----------------------------------Supplement not ap p licable------------------Other fo r m u la s --------------------------------------------
-
-
-
-
1
2
1 .2
1 3 .4
-
100
32
1,002. 7
2 2 5 .2
7
"
-
-
Method of financing
Noncontributory-----------------------------------------Contributory ------------------------------------------------
125. 6
~
0., 50
A ll plans with early retirem ent -----------------
0..4166
20
273. 5
16
4
1
3
-
256.
16.
3.
13.
-
18
2
269. 3
4 .2
2 6 1 .4
■
0. 40
Other 2
0.3 3 3 3
3
2 2 .9
8
106. 7
3
2 2 .9
1 6 .9
■
4
138. 0
19
1 72.9
22. 0
14
4
Relationship of early retirem ent to
norm al retirem ent form ula
Same as norm al benefit fo r m u la ---------------—
Modified norm al benefit fo rm u la ---------------- —
Service limitations of 25 y e a r s -------------Minimum not applicable -----------------------B asic not applicable --------------------------------Minimum based on service not applicable ----With supplement --------------------------------------Supplement not ap plicable----------------------Other form ulas ----------------------------------------------
8
7
0
7
-
6
2
70. 7
36. 0
3
-
-
-
-
-
-
2
-
36. 0
-
1
116. 0
2
2
1
1 0 3 .3
52. 6
3 4 .4
1 8 .2
17. 0
1
2
7. 5
15. 4
8
106. 7
1
3
3 .9
134. 1
12
7
84. 0
8 8 .9
-
-
-
Method of financing
N oncontributory---------------------------------------------Contributory ---------------------------------------------------
____
1 Based on a study of 300 selected pension plans under collective bargaining covering approximately 4 ,6 7 0 ,0 0 0 w orkers.
2 Includes 12 plans in which reductions varied according to age at retirem ents; the rem ainder reduced benefits by
unspecified amounts.
47
Table 30.
Tim e of payment for early retirem ent benefits by method of financing, fall 1959
(W orkers in thousands)________________________________________
A ll plans
Noncontributory
Contributory
Tim e of benefit payment
A ll plans with early r e t i r e m e n t ________
Im m ediately on retirem ent;
cannot be d e f e r r e d ........... .
....
Im m ediately on retirem ent or
deferrable to norm al re tire
ment a g e __________________________________
Anytime up to and including
norm al retirem ent age
Number
W orkers
Plans
224
3 ,0 3 1 .6
178
2 ,5 6 3 . 8
46
467. 8
85
1 ,0 8 1 .6
56
779. 8
29
301. 8
129
1 ,8 7 6 .5
116
1 ,7 3 5 . 1
13
1 4 1 .4
10
73. 5
6
4
2 4 .6
W orkers
4 8 .9
Plans
W orkers
1 Based on a .study of 300 selected pension plans under collective bargaining covering approximately 4 ,6 7 0 ,0 0 0 w orkers.
Table 31.
Level income option under early retirem ent provisions by method of financing, fall 1959 1
(W orkers in thousands)_______________________________________________
A ll plans
None ontr ibuto r y
Contributory
Provision
Number
All plans with early retirem ent .......
With level income option
Without level income option
_ ...
. _
W orkers
Plans
W orkers
Plans
W orkers
224
3, 031. 6
178
2 ,5 6 3 . 8
46
51
393. 1
29
212. 3
22
180. 8
149
2 ,3 5 1 .5
24
287. 0
173
2 ,6 3 8 .5
467. 8
Based on a study of 300 selected pension plans under collective bargaining covering approximately 4 ,6 7 0 ,0 0 0 w orkers.
Table 32.
Provisions for disability retirem ent in selected pension plans under collective bargaining
method of financing, and type of bargaining unit, fall 1959
by industry group,
00
(W orkers in thousands)
Noncontributory
All plans
With
disability
retirement
Total
Industry group
Without
disability
retirement
With
disability
retirem ent
.. Total
W orkers
Plans
All plans studied ___________________
300
4 ,6 7 2 . 7
219
3 ,2 1 9 .7
81
1 ,4 5 3 . 0
251
3 ,9 0 1 . 9
190
2, 863. 8
61
1 ,0 3 8 . 1
M anufacturing________________
229
3 ,2 0 9 .6
178
2 ,7 7 7 .1
51
432. 5
195
2 ,8 2 1 . 1
159
2 ,4 8 1 .6
36
339. 5
Food and kindred products ________
Tobacco manufactures _____________
Textile m ill products ______________
Apparel and other finished textile
products _______________ __________
Lumber and wood products ,
except furniture
Furniture and fixtures
Paper and allied products
Printing, publishing, and allied
industries
...... .
Chemicals and allied p roducts_____
Petroleum refining and related
industries
Rubber and m iscellaneous plastics
products
__
Leather and leather products
Stone, clay, and glass products___
Prim ary metal indu stries__________
Fabricated m etal products
Machinery, except electrical
Electrical machinery, equipment,
and supplies
... _
Transportation equipment _________
Instruments and related products...
Miscellaneous manufacturing
industries
17
3
8
185. 0
26. 1
3 9 .4
10
2
2
157.2
20. 8
2 2.6
7
1
6
2 7. 8
5. 3
16. 8
11
3
7
156. 6
26. 1
3 0 .4
8
2
2
148. 0
20. 8
2 2 .6
3
1
5
8 .6
5. 3
7. 8
9
325. 9
5
2 30.4
4
95. 5
9
325. 9
5
2 3 0 .4
4
9 5 .5
-
3
4
9
23. 1
42. 7
50. 1
3
2
4
23. 1
38. 7
3 1.6
2
5
3
4
5
23. 1
42. 7
17. 1
3
2
2
23. 1
38. 7
5 .6
-
4. 0
18. 5
2
3
_
4. 0
11.5
4
5
13
16. 2
121. 1
3
10
12. 7
114. 8
2
3
3. 5
6. 3
5
12
16. 2
119. 6
3
10
12. 7
114. 8
2
2
3. 5
4. 8
9
81. 7
8
77. 5
1
4. 2
1
1. 1
1
1. 1
-
8
4
10
33
13
28
106. 9
40. 3
7 4.4
588. 3
113.0
201. 2
8
3
10
33
13
24
106.9
30. 3
74.4
588. 3
113.0
192. 7
-
10. 0
-
-
-
8. 5
106. 9
40. 3
7 4 .4
5 7 1 .9
113.0
184.4
8
3
10
32
13
23
106. 9
30. 3
7 4 .4
571. 9
113. 0
179.4
-
4
8
4
10
32
13
26
16
24
4
316. 3
805. 0
19.4
13
17
2
303. 0
6 09.4
3. 7
3
7
2
13. 3
195. 6
15. 7
11
20
2
163. 0
759. 2
15. 7
9
17
152. 5
6 0 9 .4
9
33. 5
6
26. 0
3
7. 5
9
33. 5
6
71
1,463. 1
41
4 42.6
30
1 ,0 2 0 .5
56
1 ,0 8 0 .8
6
12
17
4
14
8
2
4
22 1 .6
405. 0
468. 2
153. 2
64. 3
50. 1
39. 0
31. 7
4
4
13
3
7
4
2
1
2 1.6
20. 1
132. 5
145. 3
31.0
25. 5
39. 0
1.6
2
8
4
1
7
4
200.
384.
335.
7.
33.
24.
3
30. 1
5
11
11
4
9
8
2
4
218. 0
105. 0
4 3 5 .0
153. 2
39. 8
50. 1
39. 0
31. 7
4
3 0.0
3
2 6.0
1
4. 0
2
Nonmanufacturing ____________
Mining, crude petroleum , and
natural gas production____________
Contract con struction ______________
Transportation 1 .
_
_
Communications ___________________
Utilities: E lectric and gas ________
Wholesale and retail trade ________
Hotels and restaurants ____________
Services
___
Miscellaneous nonmanufacturing
industries
.....
See footnote at end of table.
Plans
1
-
-
W ork
ers
-
0
9
7
9
3
6
_
Plans
9 .0
Plans
W ork
ers
Plans
1
-
With
disability
retirement
Total
Plans
Workers
W ork
ers
Contributory
Without
disability
retirem ent
W ork
ers
-
1 0.0
-
W ork
ers
Plans
49
770. 8
34
388. 5
6
1
28. 4
Plans
-
W ork
ers
Plans
W orkers
29
355. 9
20
414. 9
19
295. 5
15
93. 0
2
4
_
1
1 9 .2
_
9. 0
_
_
_
_
2
_
_
7 .0
_
1
_
1.5
-
-
9. 0
-
9 .2
_
-
-
-
-
-
Without
disability
retirement
-
_
26. 0
3 3 .0
_
2
1
1. 5
_
-
8
80. 6
7
7 6 .4
1
4. 2
1
1 6.4
_
1
1 6.4
_
_
_
_
_
_
-
-
_
_
_
-
-
-
-
_
-
_
_
3
5 .0
2
16. 8
1
13. 3
1
3. 5
2
3
2
10. 5
149. 8
15. 7
5
4
2
153. 3
45. 8
3. 7
4
150. 5
2. 8
45. 8
26. 0
3
7. 5
-
31
382. 2
25
698. 6
15
382. 3
10
3
4
7
3
6
4
2
1
18. 0
20. 1
99. 3
145. 3
2 8 .4
25. 5
39. 0
1.6
2
7
4
1
3
4
200. 0
8 4 .9
335. 7
7 .9
11 .4
24. 6
1
1
6
3. 6
300. 0
33. 2
6
-
1
-
5 .0
-
-
-
5
-
-
1
4
2
3. 7
-
-
-
-
-
24. 5
1
-
60. 4
3. 6
_
33. 2
5
_
1
-
_
_
_
1
2 .6
4
_
321. 9
_
300. 0
-
_
21. 9
-
-
_
-
_
-
-
_
-
_
_
-
-
-
_
_
3
30. 1
-
1
4. 0
2
21. 0
2
21. 0
_
Table 32.
Provisions for disability retirem ent in selected pension plans under collective bargaining
method of financing, and type of bargaining unit, fall 1959— Continued
by industry group,
Multiemploye r
Single employer
Industry group
All plans studied ...........
............
M anufacturing_______________
Food and kindred products ________
Tobacco m anu factures_____________
Textile m ill products_______________
Apparel and other finished textile
.............
products.
....
Lumber and wood products,
except furniture __________________
Furniture and fixtures _____________
Paper and allied products _________
Printing, publishing, and allied
industries
___
Chemicals and allied products ____
Petroleum refining and related
............................. .
industries
Rubber and m iscellaneous plastics
products
.....
Leather and leather products .. .
Stone, clay, and glass products___
Prim ary metal industries _________
Fabricated metal products .. ..
Machinery, except electrical
E lectrical m achinery, equipment,
and supplies
.... . . _
Transportation equipment _________
Instruments and related products __
Miscellaneous manufacturing
industries
Nonmanufacturing ___________
Mining, crude petroleum , and
natural gas production
_ ........ ..
Contract construction .. ... _
.. .
Transportation 1 .........
._.......... .
Communications
U tilities: Electric and gas ________
W holesale and retail trade ________
Hotels and restaurants ____________
Services ...... ___ _______ ____ ..... ....... .
Miscellaneous nonmanufacturing
industries
W ithout
disability
retirem ent
With
disability
retirement
Total
Plans
W orkers
Plans
With
disability
retirem ent
Total
Plans
Plans
Without
disability
retirem ent
Plans
W orkers
Plans
W orke rs
231
2 ,9 4 6 .4
185
2 ,6 0 3 . 1
46
343. 3
69
1 ,7 2 6 . 3
34
6 1 6 .6
35
1 ,1 0 9 .7
197
2, 639. 8
160
2 ,3 4 0 . 7
37
299. 1
32
569. 8
18
4 3 6 .4
14
133.4
12
3
6
70. 2
26. 1
16. 8
7
2
52. 5
20. 8
114. 8
3
104. 7
2
-
17. 7
5. 3
16. 8
5
-
5
1
6
1
1. 3
1
1. 3
-
2
1
8
13. 7
2. 0
45. 6
2
1
4
13. 7
2. 0
3 1 .6
-
4
1
13
4. 3
121. 1
1
10
4. 3
114. 8
-
3
9
81. 7
8
77. 5
1
8
3
10
33
13
27
106. 9
30. 3
7 4 .4
588. 3
113. 0
194. 7
8
3
10
33
13
23
106.9
30. 3
7 4 .4
588. 3
113. 0
186. 2
-
-
-
-
4
8. 5
14
24
4
3 0 9 .4
805. 0
19. 4
11
17
2
296. 1
609. 4
3. 7
3
7
2
13. 3
195.6
15. 7
-
W orkers
-
2
22. 6
-
-
-
8
324. 6
4
229. 1
4
-
1
3
1
9 .4
40. 7
4. 5
1
1
9 .4
36. 7
-
-
-
-
2
1
4. 0
4. 5
-
4
11.9
2
8 .4
2
3. 5
6. 3
-
-
-
-
-
-
4. 2
-
-
-
-
-
-
-
-
-
-
-
1
-
-
-
-
-
-
-
10. 1
-
22. 6
-
-
W orkers
2
14. 0
-
W orkers
-
-
-
-
1
-
-
-
-
-
-
-
-
-
-
-
-
1
6. 5
1
6. 5
-
-
2
6. 9
2
6 .9
-
-
-
-
-
-
-
-
-
-
10. 0
-
-
9 5 .5
-
10. 0
-
-
5
15. 6
4
13. 9
1
1. 7
4
17. 9
2
12. 1
2
5. 8
34
306. 6
25
2 6 2 .4
9
44. 2
37
1 ,1 5 6 .5
16
180. 2
21
976. 3
2 1 .6
4
2
12
7
200. 0
405. 0
421. 7
4
4
2
8
3
200. 0
384. 9
332. 7
4
-
10
4
14
-
-
46. 5
153. 2
64. 3
-
-
9
3
7
-
-
_
-
-
-
2
1 Excludes railroad and airline industries.
2 1 .0
2
2 1 .6
-
43. 5
145. 3
31. 0
-
1
1
7
_
-
-
-
-
-
2 1 .0
-
-
3. 0
7 .9
33. 3
-
-
-
-
-
-
20. 1
89. 0
-
-
-
8
2
4
50. 1
39. 0
31. 7
4
2
1
25. 5
39. 0
1.6
4
3
30. 1
2
9. 0
1
5 .0
1
4. 0
-
24. 6
-
50
Table 33.
Preparticipation requirem ents not credited as service for eligibility for disability retirem en t, fall 1959 1
M inim um age requirem ents
A ll plans
Minimum service requirem ents
Num
ber
W ork
ers
A ll plans with preparticipation for
disability re tirem en t2 ___________________
18
1 3 4 .0
No service req u ire m e n t___________________
1 year of service ___________________________
3 years of s e r v ic e __________________________
5 years of service -------------------------------------
3
8
4
3
8 .3
5 3 .3
6 0 .5
1 1 .9
No age
requirement
W ork
Plans
ers
10
1 0 8 .5
_
6
3
1
_
4 6 .9
55. 1
6 .5
Age 25
Plans
Age: 30
W ork
ers
Plans
Age 35
W ork
ers
Plans
W ork
ers
7 .4
4
1 4 .7
2
3 .4
2
32
1
1
6 .0
3 .3
5 .4
1
2 .3
.
_
_
_
_
1
1 .1
41
4 .3
3. 1
1
1 Based on a study of 300 selected pension plans under collective bargaining covering approximately 4 ,6 7 0 ,0 0 0 w orkers.
2 Preparticipation requirem ents were found in 72 of the plans studied, covering 6 2 2 ,1 0 0 w orkers. Of these, 31 plans cov
ering 2 2 8 ,9 0 0 w orkers did not provide for disability retirem ent; 23 plans with 2 5 9 ,2 0 0 w orkers provided disability retirem ent but
credited the worker with preparticipation years of service for purposes of determining eligibility. Participation requirem ents
in the remaining 18 plans are shown in this table.
3 Includes 1 plan covering 2 ,0 0 0 w orkers that stipulated age 21.
4 If hired after age 45—50 and
year of serv ice .
l/z
Table 34.
Minimum requirem ents for disability retirem en t, fall 1959 1
A ll plans
Minimum requirem ents 2
Num
ber
A ll plans providing for disability
retirem ent ________________________________
219
Service only (without preparticipation or
age requirem ents) _______________________
10 y e a r s ' service ______________________
12 years 1 service ______________________
14 y e a r s ' service ______________________
15 year s ' service ---------------------------------20 y e a r s ' service
-------------------------------25 y e a r s ' service ______________________
146
18
3
1
116
5
3
A ll plans
W ork
ers
JAge and participation --------------------------------I
Age 45 and 15 years ' p articipation___
Age 50 and 15 years ' participation----2 , 4 5 4 .7 |I Age 50 and 20 years ' p articipation___
1 1 9 .9 I Age 60 and 15 y e a r s ' participation___
2 6 .0
1 .4
2 ,1 5 4 .1 Service or participation (no age
125. 7
requirem ents) _
________________________
25 y e a r s ' service or any
2 7 .6
participation ___________________________
3 ,2 1 9 .7
Participation only (without service or
age requirem ents) _______________________
8
5 5 .2
Age only (no service requirem ents) _____
Age 50 ------------------------ -------------------------Age 5 5 _______________ ____ __ ________
3
2
1
9 .6
6”. 3
3 .3
Age and s e r v ic e ____________________________
Age 40 and 10 y e a r s ' s e r v i c e ________
Age 40 and 15 y e a r s ' s e r v i c e -------------Age 45 and 15 y e a r s ' s e r v i c e _________
Age 45 and 25 y e a r s ' s e r v i c e _________
Age 50 and 15 y e a r s ' s e r v i c e -------------Age 50 and 20 years ' s e r v i c e __
Age 55 and 15 y e a r s ' s e r v i c e _________
Age 55 and 20 years ' s e r v i c e _________
Age 60 and 10 y e a r s ' s e r v i c e _________
Age 60 and 15 years* service
Age 60 and 20 years ' service _________
47
1
1
3
31
16
1
12
3
1
1
7
Minimum requirem ents 2
5 4 7 .5
2 0 .0
2 .0
3 5 .0
2 2 .3
13 0 .8
3. 1
1 2 1 .4
1 8.2
2 .0
34. 0
15 8 .7
Alternatives _ _____________________________
25 y e a r s ' s e rv ic e , or age 50 and
15 years* serv ice ____________________
20 years ' s e rv ic e , or age 55 and
15 y e a r s ' participation ---------------------10 y e a r s ' s e rv ic e , or age 60 and
15 y e a r s ' service -------------------------------15 y e a r s ' serv ice or age 55 ----------------Age 50 and 15 years ' service or
age 55 ---------------------------------------------------15 y e a r s ' service or age 60 and
10 y e a r s ' service
. .....
Any age and service or 10 years*
service _ ______________________________
Age plus service must equal at least
75 nr any age and service
Num
ber
4
1
1
1
1
W ork
ers
3 7 .8
1 .1
2 .3
2 .6
3 1 .8
1
2 2 .0
1
2 2 .0
4 10
9 2 .9
3
4 3 .8
1
5 .4
1
1
4. 6
2 1 .2
1
4 .0
1
3 .5
1
2 .9
1
7 .5
1 Based on a study of 300 selected pension plans under collective bargaining covering approximately 4 ,6 7 0 ,0 0 0 workers.
2 Service refers to the period of em ployment, whereas participation includes period of plan m em bership only. Periods
m ay be identical or may vary if eligibility requirem ents prior to m em bership in the plan are specified.
3 Plan provided that age plus service must equal 70 with initial m inim um s age 4 5 , 15 years of service .
4 Includes 2 plans that distinguished between occupational and nonoccupational disability requirem ents and 1 plan that dif
ferentiated between disablem ent for work with the company or for all work.
51
Table 35.
Minimum age and service requirem ents for disability retirem ent, fall 1959 1
(W orkers in chousands)
Minimum age requirem ents 3
Minimum service requirement's 2
No age
requirement
W ork
Plans
ers
Num
ber
W orkers
All plans with disability retirem ent ____________
219
3 ,2 1 9 .7
164
2 , 6 2 0 .8
15
18
20
21
25
3
7
1
3
21
3
1
152
1
18
1
8
12. 4
50. 7
1. 3
20. 8
146. 5
26. 0
1 .4
2 ,4 9 8 . 3
31. 8
312. 2
2. 6
115. 7
2
6
1
2
19
3
1
4 117
10. 4
4 7 .4
1. 3
16. 5
124. 5
26. 0
1 .4
2, 168. 8
6
131. 1
7
9 3 .4
years
years
years
years
years
...........
......
.
..................
_ ...
.............
_ .. ..... . .. .
All plans with disability retirem ent
_ _
.
—
10
12
14
15
18
20
21
25
vears
years
......
...........
years
... .
years .
years
_ ....
years ...
years
years
.
...
___
—
....
... .. .. .
2 2 .0
Plans
149. 1
1
2. 0
1
W ork
ers
5
5 8 .4
-
-
-
-
_
1
_
_
_
20. 0
_
_
_
_
_
_
_
_
_
1
2. 0
3
_
_
_
_
16
_
35. 0
1
1. 1
1
22. 3
Age 60
Age 55
22
_
W ork
ers
2
Age: 50
No service requirement
1 year
...
.
3 vears
Age 45
Age 40
Plans
142. 9
10
3. 3
_
_
_
1
2. 0
1
4. 3
-
-
_
_
_
_
12
_
_
18
_
_
137. 1
121.4
_
1
1
1
3. 1
2. 6
3
18. 2
7
226. 5
_
34. 0
3 1 .8
158. 7
1 Based on a study of 300 selected pension plans under collective bargaining covering approximately 4 ,6 7 0 ,0 0 0 w orkers.
2 For 18 plans not crediting the specified period of employment served before participation in the plan could begin,
includes the preparticipation service and the required plan m em bership service.
3 In a few plans, alternative requirem ents were specified.
In each case the alternative with the earliest age or no
age requirem ent was selected.
4 Includes 1 plan covering 3 ,5 0 0 w orkers that specified disability for all employment and age 60 and 10 years of service
if disabled for company employment.
52
Table 36.
Provision for deduction of social security disability benefit from disability
retirem ent benefits by method of financing, fall 1 9 5 9 1
^W oricersjndiou^ands^
All plans
Contributory
None ontr ibuto r y
Provision
N umber
A ll plans with disability retirem en t____________
With social security deduction -------------------------A ll social security disability benefit
deducted_________________________ ___________
O ne-half social security disability benefit
deducted______________________________________
$85 for social security disability benefit
deducted______________________________________
O th er_________________________________________ _
Without social security deduction ______________
1
2
3
4
5
W orkers
219
3 ,2 1 9 . 7
Plans
W orkers
Plans
190
2 ,8 6 3 .8
29
W orkers
355. 9
89
1 ,2 0 6 .3
82
1, 1 3 8 .7
7
67. 6
2 33
2 8 3 .4
28
245. 5
5
37. 9
3 12
226. 1
11
212. 8
1
1 3 .3
441
53
63 1 .2
65. 6
40
3
614. 8
65. 6
1
-
1 6 .4
130
2 , 0 1 3 .4
108
1, 725. 1
22
288. 3
B ased on a study of 300 selected pension plans under colledtive bargaining covering approximately 4 ,6 7 0 ,0 0 0 w orkers.
Includes 10 plans covering 50, 100 workers that deducted such amounts on an alternative form ula.
Includes 1 plan covering 9, 800 workers that only made this deduction from basic percent form ula.
A ll but 1 plan with 1 5,000 workers applied this deduction to an alternative form ula.
Varied deductions were based on alternative form ulas.
Table 37.
D isability retirem ent benefits, excluding social security disability benefit, for workers 50 years
of age earning $ 4 , 800 per year for 20 years of future credited service
by method of financing, fall 1 9 5 9 1
(W orkers in thousands)
Amount of monthly disability
retirem ent benefit
A ll plans
N umbei’
A ll plans with disability retirem ent b e n e fit s __
219
Plans for which plan benefit was com p u ted____
177
Plans for which plan benefit was not
computable 2 ____________________________________
Under $ 2 0 ___________________________________________
$20 and under $30 ________________________________
$30 and under $40 ________________________________
$40 and under $50 ________________________________
$50 and undpr $60
_
.
_
$60 and under $70
$70 and under $80
$80 and under $ 9 0 ________________________________
$90 and under $100
$100 and under $110
$110 and under $ 1 2 0 _____________________ ______
$120 and under $ 1 3 0 _____________ __ ____________
$ 130 and over _____________________________________
Noncontributory
W orkers
Plans
Contributory
W orkers
Plans
W orkers
3 ,2 1 9 .7
190
2, 8 6 3 .8
29
355. 9
2, 6 8 9 .7
157
2 ,4 3 3 .2
20
256. 5
42
530. 0
33
430. 6
9
9 9 .4
3 15
9
6
11
93
9
8
6
6
7
1
4
2
1 9 1 .4
9 9 .4
2 1 .9
1 1 7 .4
1, 7 45.3
63. 6
5 0 .8
19. 8
1 10.3
9 4 .3
116. 0
4 1 .5
18 .0
15
8
4
11
91
6
7
5
6
4
1 9 1 .4
86. 1
16. 2
1 1 7 .4
1, 727. 9
43. 4
4 8 .0
15. 8
110. 3
76. 7
_
1
2
_
2
3
1
1
_
1 3 .3
5. 7
_
17. 4
2 0 .2
2. 8
4 .0
_
17. 6
116. 0
4 1 .5
1 8 .0
_
_
_
_
3
1
4
2
1
Based on a study of 300 selected pension plans under collective bargaining covering approximately 4, 670, 000 w orkers.
Includes 29 plans, covering 3 9 7 ,0 0 0 w orkers, that did not meet assumed conditions of this study; for the remaining
13 plans, benefits were reduced by unspecified amounts and therefore, not computable.
3
Includes 13 plans, covering 159 ,4 0 0 w orkers, that provided no plan benefit because of the deduction of social security
disability benefits.
53
Table 38. D isability retirem ent benefits, including maxim um social security disability b e n e fit,1 for workers 50 years
of age earning $ 4 , 800 per year for 20 years of future credited service by method of financing, fall 1959 2
(W orkers in thousands)
Amount of monthly disability
retirem ent benefit
A ll plans
Noncontributory
Contributory
Number
W orkers
Plans
W orkers
A ll plans with disability retirem ent
benefits __________________________________________
219
3 ,2 1 9 .7
190
2, 863. 8
29
355. 9
Plans for which benefit was com puted_________
Plans
W orkers
177
2, 689. 7
157
2 ,4 3 3 . 2
20
256. 5
Plans for which benefit was not
computable 3 ____________________________________
42
530. 0
33
430. 6
9
9 9 .4
$ 1 2 7 ________________________________________________
$140 and under $150 ____________________________
$150 and under $160 ____________________________
$ 160 and under $ 170 ____________________________
$170 and under $180 ____________________ ______
$ 180 and under $ 190 ____________________________
$ 190 and under $200 ____________________ ________
$200 and under $210 ____________________________
$210 and under $220 --------- ------------------------------$220 and under $230 ____________________________
$230 and under $240 ____________________________
$240 and under $250 ________________________ __
$ 250 and over ____________________________________
4 13
5
9
9
93
11
4
11
5
8
2
3
4
159. 4
6 2 .0
82. 6
103. 0
1, 733. 9
49. 1
45. 4
51. 4
81. 9
125. 5
20. 0
139. 9
35. 6
13
5
8
7
93
7
4
8
5
6
1
159.
62.
69.
97.
1, 733.
27.
45.
28.
81.
117.
10.
-
4
0
3
3
9
9
4
2
9
9
0
-
"
_
_
-
1
2
-
4
3
-
2
1
3
4
-
1 3 .3
5. 7
21. 2
-
23. 2
7. 6
10. 0
139. 9
35. 6
1 Current m aximum is $127 per month.
2 Based on a study of 300 selected pension plans under collective bargaining covering approximately 4, 670, 000 w orkers.
3 Includes 29 plans, covering 397, 000 w orkers, that did not m eet assumed conditions of this study; for the remaining
13 plans, benefits were reduced by unspecified amounts and, therefore, not computable.
4 These plans do not provide any benefit under assum ed conditions because of a social security disability benefit offset.
They could, however, pay benefits to workers entitled to less than m axim um social security benefits.
Table 39.
Disability retirem ent benefits, for workers ineligible for social security disability benefit, 50 years of age
earning $ 4 , 800 per year for 20 years of future credited service by method of financing, fall 1959 1
(W orkers in thousands
A ll plans
Contributory
Noncontributo ry
Monthly benefit amount
N umber
W orkers
Plans
W orkers
Plans
W orkers
A ll plans with disability retirem ent
b e n e fits __________________________________________
219
3, 219. 7
190
2, 863. 8
29
355. 9
Plans for which benefit was computed _______
177
2, 6 8 9 .7
157
2, 433. 2
20
256. 5
42
530. 0
33
430. 6
9
9 9 .4
Plans for which benefit was not
computable 2 _____________________________________
$20 and under $30 _______________________________
$30 and under $40 _____________________ ______
$40 and under $50 _______________________________
$50 and under $60 _______________________________
$60 and under $70 _______________________________
$70 and under $80 _______________________________
$80 and under $90 _____ _____ ________________
$90 and under $ 1 0 0 _______
____________________
$ 100 and under $ 110 ____________________________
$110 and unde r $ 120 ____________________________
$ 120 and under $ 130 ______________________ ____
$130 and under $140 __ _______ _______________
$140 and under $150 ___________________ ______
$ 160 and under $ 170 ____________________ ______
$ 170 and under $ 180 ____________________________
$ 180 and under $ 190 ____________________________
$ 190 and under $200 ____________________________
$200 and over ____________________________________
3
2
5
17
9
15
18
58
35
2
6
1
_
2
-
2
-
2
36.
4.
39.
185.
58.
57.
360.
809.
915.
117.
34.
2.
8
7
7
4
4
3
7
5
2
4
3
9
_
31. 2
-
18. 2
-
18. 0
3
1
5
16
8
14
16
56
32
1
3
1
36.
3.
39.
184.
56.
54.
352.
779.
897.
1.
7.
2.
8
0
7
4
4
5
7
8
6
4
8
9
_
1
-
1
1
1
2
2
3
1
3
_
-
_
_
1
16. 2
1
-
-
-
-
_
2
_
-
-
-
-
2
_
1 .7
-
1.
2.
2.
8.
29.
17.
116.
26.
0
0
8
0
7
6
0
5
_
-
15. 0
-
18. 2
-
18. 0
1 Based on a study of 300 selected pension plans under collevtive bargaining covering approximately 4, 670, 000 w orkers.
2 Includes 29 plans, covering 3 9 7 ,0 0 0 w orkers, that did not m eet assumed conditions of this study; for the remaining
13 plans, benefits were reduced by unspecified amounts.
Appendix
Provisions for normal, early, and disability retirem ent in selected pension plans under collective bargaining
by industry group and method of financing, fall 1959
(W orkers in thousands)
Contributory
Noncontributory
All plans
Industry group
A ll plans studied---------------------------------
GOVERNMENT PRINTING OFFICE : 1961 O - 585058
Num
ber
W ork
ers
300
4 ,6 7 2 .7
Normal
retirement
only
Work
Plans
ers
31
771.2
Nor mal
and e:arly
retire sment
W ork
Plans
ers
1 30
2 6 6 .9
8. 0
4. 6
22. 6
7
1
-
140. 0
16.2
-
.
_
-
-
-
5
230. 4
-
1 .5
7. 0
1
-
36. 7
-
1 .3
2. 5
2
2
8. 4
31. 0
Food and kindred products--------------Tobacco manufacturing --------------------Textile m ill products —------- -------------Apparel and other finished
textile products ------------------------------Lumber and wood products,
except furniture -----------------------------Furniture and fixtures ---------------------Paper and allied products --------------Printing, publishing, and
allied industries -----------------------------Chemicals and allied pro d u cts--------Petroleum refining and related
indu stries-----------------------------------------Rubber and m iscellaneous
plastics products ----------------------------Leather and leather products----------Stone, clay, and glass pro du cts-----P rim ary m etal in d u stries----------------Fabricated metal products--------------Machinery, except e le c t r ic a l---------E lectrical m achinery, equipment,
and supplies ------------------------------------Transportation equipm ent----------------Instruments and related products —
M iscellaneous manufacturing
indu stries------------------------------------------
17
3
8
185. 0
26. 1
3 9 .4
1
-
3. 3
-
2
1
5
5. 3
5. 3
7. 8
9
325.9
4
9 5 .5
1
2
1
1
Nonmanufacturing ------------------Mining, crude petroleum , and
natural gas production------------------Contract con stru ction ----------------------Transportation 3 -------------------------------- Communications --------------------------------Utilities: electric and gas -------------W holesale and retail trade -------------Hotels and restau ran ts---------------------Services and m iscellaneous ------------M iscellaneous nonmanufacturing
in d u stries------------------------------------------
1
1
2 .2
2. 3
300. 0
1
1
2
21
16.2
121. 1
1
2 .0 7 7 .9
130. 3
5
13
2,296. 9
134
15
1
1
2 148
403. 7
3,209. 6
23. 1
42. 7
50. 1
5 66.9
Normal
retirem ent
only
W ork
Plans
ers
25
229
3
4
9
42
Norm al, early,
and disability
retirem ent
W ork
Plans
ers
_
Manufacturing --------------------------
2. 5
4. 5
No:rmal
and di sability
reti] rement
W ork
Plans
ers
2 0 9 .2
_
Norm al
and early
retirem ent
W ork
Plans
ers
Norm al
and disability
retirem ent
W ork
Plans
ers
Norm al,early,
and disability
retirement
W ork
Plans
ers
1 14.9
2
3 .0
27
3 5 2 .9
15
93. 0
_
_
19
295. 5
4
1
1 9.2
9 .0
_
-
_
-
2
-
9 .2
-
-
-
-
-
-
19
-
-
-
-
3
1
2
23. 1
2. 0
5. 6
-
-
2
7. 0
-
-
2
26. 0
1
8
4. 3
83. 8
-
-
1
1. 5
-
-
-
-
9
8 1 .7
-
-
-
-
1
1. 1
-
-
-
1
4 .2
-
-
7
76. 4
8
4
10
33
13
28
106.9
40. 3
7 4 .4
588.3
113. 0
20 1 .2
1
2
10. 0
2. 5
1
2. 5
2
2
2
26. 8
1 8 .4
4. 0
8
1
8
32
13
21
106.9
3. 5
56. 0
57 1 .9
113. 0
175. 4
-
-
-
1
3. 5
-
-
1
1
16. 4
13. 3
16
24
4
31 6 .3
805. 0
19. 4
-
-
2
3
2
10. 5
149. 8
15. 7
2
1
-
6 .9
3. 0
-
7
16
-
145. 6
606. 4
-
-
-
1
4
-
2. 8
45. 8
-
-
-
4
2
150. 5
3. 7
9
33. 5
3
7. 5
-
-
1
1. 8
5
2 4 .2
-
-
-
-
-
71
1,463. 1
16
6 40.9
9
57. 7
17
163.2
14
219. 0
1
300. 0
4
2 1 .9
2
3. 0
8
57. 4
6
12
17
4
14
8
2
4
2 2 1 .6
405. 0
4 68.2
153.2
64. 3
50. 1
3 9 .0
3 1 .7
2
6
3
2
2
200. 0
83. 5
328. 0
4 .2
2 1 .2
1
1
1
3
2
1
1 .4
7. 7
7 .9
1 1 .4
2 0 .4
8 .9
4
5
1
1
2
2
1
20. 1
58. 3
3 0 .2
1. 5
7. 5
39. 0
1. 6
3
2
2
5
2
-
18. 0
4 1 .0
115. 1
2 6 .9
18. 0
-
1
-
300. 0
-
4
-
2 1 .9
-
2
-
3. 0
-
1
4
1
-
3. 6
3 0 .2
2. 6
-
4
3 0 .0
1
4. 0
1
5. 0
2
21. 0
1 Excludes 3 plans, covering 9 7,200 w orkers, that contained early retirem ent provisions for women only.
2 Excludes 9 plans, covering 2 5 1 ,5 0 0 w orkers, that contained early retirem ent provisions for women only.
3 Excludes railroad and airline industries.
-
-
"
Recent BLS Industrial Relations Studies
Bull. No.
Title
Price
Agreement Provisions
1282
Paid Sick Leave Provisions in Major Union Contracts, 1959.
30 cents
1272
Union Security and Checkoff Provisions in Major Union Contracts ,
1958-59.
20 cents
1266
Collective Bargaining Clauses: Company Pay for Time Spent on
Union Business. October 1959.
35 cents
1251
Premium Pay for Night, Weekend, and Overtime Work in Major
Union Contracts, 1958.
30 cents
1248
Paid Holiday Provisions in Major Union Contracts, 1958.
25 cents
1233
Paid Vacation Provisions in Major Union Contracts, 1957.
30 cents
1216
Collective Bargaining Clauses: Dismissal Pay. August 1957.
25 cents
1209
Analysis of Layoff, Recall, and Work-Sharing Procedures in
Union Contracts. March 1957.
30 cents
Employee-Benefit Plans
1280
Health and Insurance Plans Under Collective Bargaining:
Surgical and Medical Benefits, Late Summer 1959.
30 cents
1274
Health and Insurance Plans Under Collective Bargaining:
Hospital Benefits, Early 1959.
30 cents
1259
Pension Plans Under Collective Bargaining:
Part I. Vesting Provisions and Requirements for Early Retirement
Part II. Involuntary Retirement Provisions, Late 1958.
25 cents
1250
Health and Insurance Plans Under Collective Bargaining:
Accident and Sickness Benefits, Fall 1958.
25 cents
1236
Digest of One Hundred Selected Health and Insurance Plans Under
Collective Bargaining, Early 1958.
$1.25
1232
Digest of One Hundred Selected Pension Plans Under Collective
Bargaining, Winter 1957-58.
45 cents
Union Activities
1267
Directory of National and International Labor Unions in the
United States, 1959.
45 cents
1263
Union Constitution Provisions: Trusteeship. November 1959.
30 cents
1239
Union Constitution Provisions: Election and Tenure of National
and International Union Officers, 1958.
30 cents
Work Stoppages
1278
Analysis of Work Stoppages, 1959.
40 cents
General
1225
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A Guide to Labor-Management Relations in the United States.
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Supplement No. 1. November 1958.
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