Tuesday, December 11, 2012

Verizon moves pension obligations to Prudential

(AP) ? Phone company Verizon has transferred $7.5 billion in pension obligations to Prudential Insurance after a retiree association failed to convince a court to stop the move.

Members of the Association of BellTel Retirees sued in federal court in Dallas two weeks ago to stop the deal, saying it would weaken the legal protections for retirees. It effectively turns the company's defined-benefit pensions into annuities to be paid by Prudential. Annuities aren't covered by the federal Pension Benefit Guaranty Corp.

On Friday, the judge ruled that the retirees had failed to show they were likely to be harmed by the deal.

The plan covered 41,000 management retirees.

New York-based Verizon Communications Inc. has said that the deal lowers the risk that its pension obligations will end up costing more than projected.

Associated Press

Source: http://hosted2.ap.org/APDEFAULT/495d344a0d10421e9baa8ee77029cfbd/Article_2012-12-10-Verizon-Pension/id-f261e40e912942c8bb5599f4c3fb58a8

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