Retirement - Mid-America Carpenters Regional Council Benefit Funds

Breaks in Service / Loss of Credit

Retirement / Construction Pension Fund

Can I lose pension credit?

Once you are vested, you cannot lose your pension credit. However, before you are vested, it is possible to permanently lose pension credit if you experience a break in service.

There are two types of breaks in service, temporary breaks in service and permanent breaks in Service. Generally, if you have a permanent break in service, you lose your status as a participant under the Plan including your vesting service and pension credit.

Questions?

Contact the Retirement Benefits Department

(312) 787-9455, menu option 4
Monday – Friday, 8:00 a.m. – 4:30 p.m.
retirement@carpenterbenefits.org

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Documents

Example: Temporary Break in Service:

Scenario #1: Work Record for Robert Thompson
Year Hours of Work Years of Vesting Service1 Years of Pension Credit2
1 1,220 1 1
2 1,050 1 1
3 520 0 ½
4 260 0 ¼
5 150 0 0 - Temporary Break #1
6 0 0 0 - Temporary Break #2
7 0 0 0 - Temporary Break #3
8 0 0 0 - Temporary Break #4
9 250 0 ¼
10 180 0 0 - Temporary Break #1

During Robert’s time as a carpenter, he has earned less than 5 years of vesting credit, so he is not yet vested in the Plan. This opens him up to potential loss of pension credits.

In Years 5 through 8, Robert did not earn at least ¼ Year of Pension Credit, incurring Temporary Breaks in Service in each of those years.

Robert then returned to Covered Employment to earn ¼ Year of Pension Credit in year 9, repairing the four Temporary Breaks. This means that the previous Breaks are set aside and the new Temporary Break incurred in Year 10 is considered to be his first.

What if Robert failed to earn ¼ or more Years of Pension Credit in Year 9? He would incur a Permanent Break in Service, which cancels his status as a participant in the Plan and causes loss of all of his Years of Pension Credit and Vesting Service (see below)

Example: Permanent Break in Service:

Scenario #2: Work Record for Robert Thompson
Year Hours of Work Years of Vesting Service1 Years of Pension Credit2
1 1,220 1 1
2 1,050 1 1
3 520 0 ½
4 260 0 ¼
5 150 0 0 - Temporary Break #1
6 0 0 0 - Temporary Break #2
7 0 0 0 - Temporary Break #3
8 0 0 0 - Temporary Break #4
9 0 0 0 - Temporary Break #5
PERMANENT BREAK

1 Annual Pension Credits < 1 result in 0 Years of Vesting Service earned
2 See Earning Pension Credit for calculation rules

There are exceptions to the break in service rules for military service, FMLA, disability and certain types of employment. Contact the Retirement Benefits Department for more information.