After putting years, maybe even one’s whole career, into one company, Tennessee residents expect to be paid the retirement benefits promised them. What happens, though, if the company files for bankruptcy? Is the pension lost? Thanks to the safeguards offered through the Employee Retirement Income Security Act (ERISA), some retirement benefits may still be paid out.
Pension plans are federally insured. This means that it does not matter what happens to one’s employer, retirement benefits will still likely be available — to some degree. Full benefits may not be available, but what is offered is generally better than receiving nothing at all. Every situation is different.
When a company goes bankrupt, the Pension Benefit Guaranty Corporation will typically take over paying the pension benefits to retirees. There are some exceptions and restrictions though, which legal counsel would be able to address. It is believed that, because of the way this program is set up, roughly 84 percent of individuals whose pensions have been affected by company bankruptcy will still receive their full benefits.
The thought of losing one’s retirement benefits would be devastating to most people. Knowing ERISA protections are available should offer some relief to Tennessee residents whose employers have gone bankrupt. Of course, the program is not perfect, and some individuals may find themselves struggling to achieve the benefits they feel that they are owed. Legal counsel will have the ability to review one’s case, explain what is going on and, if necessary, assist the client in fighting for fair pension compensation.