The Co-op Retirement Plan has provided outstanding benefits for the employees of participating cooperative organizations since 1946. Here, in a summary format, are the key rules, provisions, and benefits of the Plan. Of course, this is only a brief description. More details may be found in the Summary Plan Description. The exact terms of the Plan are found in the official Plan Document. If a misunderstanding arises over the language contained in this Quick Summary or the Summary Plan Description, the language of the official Plan Document will prevail.

Your participation in the Plan is mandatory if you are at least 21 years of age and you work at least 1,000 hours in your first 12 months of employment or 1,000 hours in any subsequent Plan year.  Under the Plan’s rules you are assumed to work 190 hours per month in any month that you perform any work at all or are otherwise entitled to wages (such as vacation or sick pay, or a paid leave of absence).   Once you become a participant you will remain a participant until you retire, terminate employment, become disabled, or die. 

New employees will enter the Plan on the first day of the second month after accumulating 1,000 hours of service, provided that they are at least 21 years of age.  As explained above, you are assumed to work 190 hours per month in any month that you perform any work at all or are otherwise entitled to wages, regardless of the number of hours you actually work.  Therefore, you will accumulate 1,000 hours of service if you work in six different months.  Thus, full-time employees, and part-time employees who work each month will generally enter the Plan seven to eight months following their hire date.

Former participants who are re-hired generally re-enter the Plan immediately following their rehire.

CONTRIBUTIONS

You contribute a certain percentage of your pay to the plan.  This percentage is determined by your employer and is automatically deducted from each paycheck you receive. Participating Employers contribute whatever else is necessary to keep the Plan on sound actuarial footing.

You are always 100% vested in that portion of your Accrued Benefit that is purchased by your own personal contributions and the interest thereon. Your entire Accrued Benefit becomes vested after five years of service. Vesting service is generally counted from your hire date.

Your Final Average Wage is the average of your four highest annual wages from your last ten years of employment. Each year, your employer reports to the Plan your gross wages (generally) and the number of months for which you were credited with service during the year. Your annual wage base is expressed as a monthly average and is calculated by taking your annual wage and dividing by the number of months of service.  This wage base is then added to your 10-year Wage History and the wage from eleven years ago drops off. When you terminate or retire, the Plan calculates your Final Average Monthly Wage by extracting the four largest wage bases in your 10-year Wage History, adding them together, and dividing by four.

The current year’s wage base will not be added to your 10-year Wage History unless you are on the payroll of your Participating Employer on December 31 of that year.

BENEFIT ACCRUAL RATE

The benefit accrual rate is the multiplier in the benefit formula.  It tells you how much of your Final Average Wage will be replaced for each year of Creditable Service.

·         The Plan-wide benefit accrual rate was 1.75% prior to October 1, 2003. 

·         From October 1, 2003 to June 30, 2009 the Plan-wide benefit accrual rate was 1.25%. 

·         Starting July 1, 2009 each Participating Employer must choose the benefit accrual rate that will apply to its employee-group.  Three benefit accrual rate choices (1.75%, 1.50%, and 1.25%) are available. Employers may change their election each July 1.

Therefore, you may have Creditable Service under one, two, or even three different benefit accrual rates.  The diagram below shows how the basic benefit formula is expanded to recognize Creditable Service under multiple benefit accrual rates:

You receive one month of Creditable Service for each month during which you perform work for your employer or are otherwise paid for times you do not work (such as vacation or sick pay, or a paid leave of absence). Thus, full-time and permanent part-time employees would generally receive 12 months of Creditable Service per year, whereas seasonal employees would generally receive Creditable Service equal to the actual number of months they work during the year.  You would not receive service credit, however, during a break-in-service, an unpaid leave-of-absence, or a period in which your employer has suspended its active participation in the plan. There is no limit to the amount of Creditable Service you may accumulate.

The Normal Retirement Date is the latter of age 65 or the first day of the calendar year in which you become vested in the Plan.

Deferred Retirement is any retirement which is delayed past the Normal Retirement Date.

If you’re vested, you may retire as early as age 55. Any retirement between age 55 and age 65 is called Early Retirement. (Special early retirement rules apply to those whose age plus Creditable Service equals 85, see below.)

If you are a vested participant age 55 or older at the time you terminate your employment, you may receive early retirement benefits under the following schedule: (Amounts are pro-rated between birthdays)

55…………………………........……72%

56…………………………........……76%

57……………………........…………80%

58………………………........………84%

59……………………........…………88%

60……………………........…………92%

61……………………........…………96%

62 or above…………........………100%

* Individual Member Benefit payment option

If you terminated employment before age 55 and are entitled to a vested, deferred annuity at age 65, you may receive early retirement benefits under the following schedule: (Amounts are pro-rated between birthdays)

55…………………………………….37.9%

56…………………………………….41.4%

57…………………………………….45.3%

58…………………………………….49.7%

59…………………………………….54.5%

60…………………………………….60.0%

61…………………………………….66.1%

62…………………………………….73.0%

63…………………………………….80.9%

64…………………………………….89.8%

65……………………………………100.0%

* Individual Member Benefit payment option

In addition to the Early Retirement Benefits described above, the Co-op Retirement Plan also provides a special early retirement benefit called the "Rule of 85." The Rule of 85 allows you to retire immediately, at any age, with 100% of your Accrued Benefit if you meet these qualifications:

1. Your age plus your Creditable Service equals 85 or more.
2. Your last ten years of Creditable Service was earned in the Co-op Retirement Plan.
3. Your last ten years of Creditable Service must be continuous service.

Subject to certain limitations, you may receive your retirement benefit under any of these seven different payment methods:

• Individual Member Benefit
• 10-year Guaranteed Benefit
• Level Income Option
• 50% Joint Annuity
• 66.7% Joint Annuity
• 75% Joint Annuity
• 100% Joint Annuity

The Joint Annuity options are only available to married participants.  If you are a retiree or receive disability benefits from the Plan, the Joint Annuity options also include a 10-year guarantee.  The Level Income Option is only available to those who retire before age 62.   Please view the description of these payment options in the Summary Plan Description for additional details. 

If you previously participated in another retirement plan and had your benefit transferred to this Plan, additional payment methods may be available with respect to a portion of your Plan benefits. 

If you terminate your employment before retirement age (55), your benefit from the Plan depends on your vesting status. If you’re not vested, you’ll receive a refund of your personal contributions plus interest in a lump sum or monthly payments. If you’re vested, you have the choice between retaining your personal contributions in the plan (Option A) or taking a withdrawal of an amount equal to your personal contributions plus interest in a lump sum or monthly payments (Option B). Under Option A, you may receive your entire Accrued Benefit as an annuity beginning at age 65, or in a reduced amount if commenced before age 65. Under Option B, you would receive a refund of your personal contributions and interest upon termination, and the vested, employer-purchased portion of your Accrued Benefit as an annuity beginning at age 65, or in a reduced amount if commenced before age 65.

Caution: If you terminate employment before age 55, ask the Plan for an estimate of your Option A and B benefits. The estimate will explain how to avoid certain tax pitfalls associated with early withdrawal from a qualified pension plan.

The surviving spouse of an active participant who dies before retiring will receive the largest death benefit allowed by law, the survivor portion of a 100% Joint and Survivor Annuity. The size of a survivor’s death benefit is determined by these four factors:

1. The deceased participant’s Accrued Benefit at the time of death
2. The deceased participant’s vesting status
3. The deceased participant’s age at death
4. The surviving spouse’s age

If an active participant dies before age 55, the participant’s spouse is generally given the same options available to a terminated employee. (Options A and B)

If an active participant dies after reaching age 55, the participant is treated as having retired on the date of his death, in which case the spouse is eligible to begin to receive the survivor portion of the 100% Joint Annuity benefit on the first of the month following the death.  Importantly, a surviving spouse must apply to receive death benefits before they will begin.

The Co-op Retirement Plan also provides a Lump-Sum Death Benefit to the beneficiary of a participant who retires from active employment after becoming eligible for a retirement benefit. (Prior to 4/1/91, the retirement must have occurred at or after age 62.) The Lump-Sum Death Benefit is based on a participant’s Final Average Wage and Creditable Service. The minimum benefit is $2,000 ($1,000 if retired before 4/1/91); the maximum benefit is $10,000. The Lump-Sum Death Benefit is paid immediately following the death of a qualified retiree and the beneficiary’s filing of an application.

If you become totally and permanently disabled while an employee of a Participating Employer, you have at least 36 months of Creditable Service (at least 12 of which occurred during the 24-month period preceding your entitlement to Social Security Disability payments), and you are declared eligible for Social Security Disability payments, you may also receive Disability Retirement payments from the Co-op Retirement Plan. The Disability Retirement payment will be the greater of 25% of your last reported annual wage, or your Accrued Benefit, unreduced for early retirement. Have your employer contact the Plan immediately if you become disabled.