Losing & Protecting Benefits

This section explains forfeiture of service and how you can be protected from a complete loss of Plan benefits. It also explains special rules that can protect your benefits while you are away from covered employment.

Topics Below

Forfeiture of Service
Interruption of Service
Hours of Service That Protect Your Benefits
Hours of Non-Covered Employment
Hours of Service for Disability Absence
Hours of Service for Certain Non-Covered Teamster Work
Maternity and Paternity Leave
Other Changes in Participant Status
Special Forfeiture Rule Before 1976
Pre-1976 Restored Covered Hours Rule

Forfeiture of Service

If you leave covered employment before you are vested, you can lose all of your Plan benefits. You have a forfeiture of service and lose all of your Plan benefits if all of the following conditions occur:

You are not vested, and
You have at least as many consecutive interruptions of service as you have years of vesting service, and
You have at least five consecutive interruptions of service. (Before 1987, you could have a forfeiture of service after as few as three consecutive interruptions of service.)

Different forfeiture rules were in effect before 1976. Click here for more information.

Click here for two examples that help explain your Plan’s forfeiture and interruption of service rules. The first shows a participant who has several interruptions of service but returns to covered employment in time to avoid a complete loss of Plan benefits. The second shows a participant who does not return to covered employment in time and loses all Plan benefits because of a forfeiture of service.

Interruption of Service

To avoid an interruption of service, you need to complete at least 250 hours of service in a calendar year. If you complete less than 250 hours of service in a calendar year, that year counts as an interruption of service.

Remember, your hours of service include your covered hours and certain other types, such as hours of noncovered employment and disability absence hours (explained next).

Hours of Service That Protect Your Benefits

Even if you are not working in covered employment or go on a reduced work schedule, your Plan counts certain time away from covered employment as hours of service.

Some hours of service help you avoid an interruption of service and also count toward vesting:

Hours of non-covered employment.
Hours of disability absence.
Hours of certain non-covered Teamster work.

Other hours of service while on maternity or paternity leave can help you avoid an interruption of service but do not count as hours of service for vesting. All of these hours of service are explained next.

Hours of Non-Covered Employment

If you are working for a covered employer but your job is not covered by the Plan, each regular time hour that you work can count as an hour of service. These hours of service are called non-covered employment.

Hours of non-covered employment count toward vesting and help protect you from a complete loss of Plan benefits. They do not count for any other purpose.

For example, if you work at least 500 hours of non-covered employment in a calendar year, you earn one year of vesting service. You can only earn one year of vesting service per calendar year.

To qualify as hours of non-covered employment, your work must meet all of the following conditions:

The work you perform must occur during the time period when your employer is a covered employer for some other group of employees, and
The work must be performed immediately before or after your covered employment with the same employer with no intervening quit, discharge or retirement, and
The work you perform must be work for which your employer compensates you.

Overtime hours and time off (other than paid holidays and paid vacation) do not count as hours of non-covered employment.

Note: Before your employer joins the Plan for any units, time you worked for that employer does not count as non-covered employment. Also, after your employer has no more covered units in the Plan, time you work for that employer does not count as hours of non-covered employment.

Click here for an example that shows how non-covered hours are counted for a sample participant.

Be sure to check with your Area Administrative Office whenever you have questions about changes that can mean a loss of covered employment or a reduced work schedule. Find out what you can do to prevent a loss of benefits.

Hours of Service for Disability Absence

The Plan offers certain protections from loss of benefits for eligible participants whose Teamster careers are interrupted due to disabilities that may or may not be permanent.

If you are totally disabled from working in your Teamster job in any month, you can qualify for special hours of service to bring your total hours for that month up to 50. Hours of service you earn due to a total disability count toward vesting and can help protect you from a complete loss of Plan benefits. They do not count for any other purpose.

To qualify for disability absence hours, you must meet all of the following requirements:

Your total disability must begin within three years after a calendar year when you were an active participant, and
During your first 36 months of disability, you must show by medical evidence that you are totally disabled from performing your usual Teamster job, and
If your total disability lasts more than 36 months, you can continue to qualify for disability absence hours by documenting your total disability with a Social Security Disability Award Certificate showing your eligibility for a disability benefit. If this certificate is not available, the disability must be documented with medical evidence verifying that you cannot engage in any substantial gainful activity because of a physical or mental disability.

If it turns out you need disability absence protection, you can apply for it at any time up to your retirement.

Because you must provide evidence of your disability, you are encouraged to contact your Area Administrative Office as soon as possible after your period of disability ends. Medical records and statements from your physicians are easier to obtain at that time rather than if you wait until retirement.

Your Area Administrative Office provides you with a form on which you can explain why you were not able to work in your usual Teamster occupation. You also receive an explanation of the types of proof of disability you may provide to establish your right to this protection.

Note: Special procedures apply to handling your application for this disability absence protection.

Hours of Service for Certain Non-Covered Teamster Work

If you leave covered employment and find another Teamster job not covered by this Plan, your work may count toward vesting and help protect you from a complete loss of Plan benefits.

For each month you work as a Teamster outside the Plan, you are credited with up to 50 hours of service, provided you meet all of the following requirements:

Your work must be in a bargaining unit represented by a Teamsters local union in the 13 Western states, and
The bargaining unit you work in must never have been covered by the Plan or must have left the Plan before you were employed in that unit, and
Your work must begin within three years after a calendar year when you were an active participant, and
You must return to covered employment and again become an active Plan participant within two years after you leave your non-covered Teamster job.

Hours of service you earn under this rule count toward vesting and help protect you from a complete loss of Plan benefits. They do not count for any other purpose.

Click here for an explanation of when you are considered an active participant.

Maternity and Paternity Leave

If you cannot work at least 250 covered hours in a calendar year because you are on a maternity or paternity leave from a covered employer, you may qualify for protection from an interruption of service.

You must meet all of the following requirements to qualify for this protection:

You must be on leave from your job with a covered employer, and
Your leave must begin after 1986, and
Your leave must be for one of the following reasons:
- Your pregnancy, or
- Birth of your child, or
- Placement of a child with you in connection with your adoption of the child, or
- Caring for the child for the period immediately following the birth or placement.

To receive credit for your leave, you must send written proof that your leave was for one of the reasons listed above to your Area Administrative Office within one year after your leave begins.

If your leave qualifies, you are credited with eight hours of service for each normal work day during your leave, up to a maximum of 250 hours of service for any one pregnancy or adoption placement.

These hours of service only count toward preventing an interruption of service in the year your leave begins or in the following year. They do not count as hours of service for vesting or any other purpose.

Other Changes in Participant Status

If your participant status changes in any way not explained in this section—if, for example, you transfer to a non-covered job or the organization you work for is sold or bankrupt—your Plan benefits may be affected.

If you are not vested, you can have a complete loss of Plan benefits. Even if you are vested, these types of changes can result in a loss of recent coverage or PEER eligibility.

Here are some situations that may affect your status as a Plan participant:

You leave your employer but do not go to work in covered employment for another employer.
You move from a covered job to a non-covered job with the same employer.
Your employer goes out of business or sells out to another company that does not assume the obligation to continue contributing under your collective bargaining agreement.
Your employer files for bankruptcy.
Your employer no longer has a collective bargaining agreement with your local union.
Your employer and your local union agree to terminate participation in the Plan.
Your local union stops being your collective bargaining representative.

If you lose Plan coverage for any reason, contact your Area Administrative Office to verify your current vesting status and the impact that ending your Plan coverage may have on your eligibility to receive benefits.

Special Forfeiture Rule Before 1976

Break in Service
If you had a break in service under the Plan before 1976 and were not yet eligible for retirement, the rules regarding loss of benefits that were in effect at that time apply to your

Before 1969, you broke your service if you had a total of less than 600 covered hours in two consecutive calendar years.

After 1968 but before 1976, the rules depended on whether you earned 7,500 covered hours:

If you had at least 7,500 covered hours, a break in service occurred if you earned less than 600 covered hours in three consecutive calendar years.
If you had less than 7,500 covered hours, a break in service occurred if you earned less than 600 covered hours in two consecutive calendar years.

If you had a break in service before 1976, you cannot get credit for any coverage, contributions or past employment under the Plan before your break in service (unless you qualify to have forfeited service restored under the Plan’s pre-1976 restored covered hours rule as explained next).

Pre-1976 Restored Covered Hours Rule

Long-time Plan participants who lost contributory service credit because of a two-year or three-year break in service before 1976 may qualify to have their contributory service credit restored so that it can be counted when calculating Plan benefits.

To qualify, you must meet all of the requirements shown below:

You worked in covered employment before 1976 and lost Plan credit for that work because of a break in service that occurred before 1976 (explained to the left), and
You returned to covered employment after that break and became vested in your new Plan benefits by December 31, 2003, and
You had no forfeitures of service after December 31, 1975. Click here for a summary of the forfeiture of service rules that apply after 1975.
You did not retire before 1999.

If you meet all of these requirements, all pre-1976 covered hours that you lost will be restored and counted for the following purposes:

Five-Year Average Benefit
Your restored covered hours increase your future service credits under the Plan’s five-year average formula used to calculate your benefits for covered employment before 1987. Click here for an explanation of the five-year average benefit formula.

Years of Contributory Service
You earn an additional year of contributory service for each year in which 500 or more covered hours are restored. Years of contributory service are important because they may help you qualify for increased early retirement benefits—through PEER, for example. Click for a summary of the types of early retirement and the rules for each.

Years of Service
You earn an additional year of service for each year in which 500 or more covered hours are restored. Remember, you may qualify for higher benefit percentages under your Plan’s contribution account formula for your covered work in years after your 20th year of service. Click here for an explanation of years of service.

Limitations
You cannot use restored covered hours to help you vest. Also, the restored covered hours rule only applies to covered hours you lost because of a break in service before 1976. It does not apply to any noncontributory past employment credit that you might have lost because of a break in service. The rule also does not apply to hours you lost because of a forfeiture of service after 1975. If you worked in covered employment before 1976, contact your Area Administrative Office to find out if you qualify to have any lost covered hours restored.

Click here for questions and answers about Losing & Protecting Benefits.