DuPont is offering nearly 10,000 retirees a one-time lump payment for their pension benefits.
Spokesman Dan Turner issued the following statement:
“DuPont announced to a group of separated, vested U.S. Pension and Retirement Plan participants that they were being offered a limited-time opportunity to receive their benefit immediately in a single lump-sum payment or to commence their monthly pension annuity early (reduced for early commencement). The offer is generally targeted to former employees who are fully vested in their pension benefits, but do not yet meet the age requirements under the Plan to collect them. The lump-sum election period starts on September 11, 2017 and ends on October 20, 2017, and payments will be made at the end of November/early December 2017.”
The offer is believed to affect about 9,500 people in the U.S. and it is not known how many people in Delaware and adjacent areas will receive the offer.
The buyouts have become widespread for a dwindling number of companies with defined benefit plans that issue monthly pension payments. Defined plans are increasingly available only to government employees.
The offer is not directly tied to the merger of DuPont and Dow, but does reflect the changing pension environment that is moving from defined benefits to 401 (k) plans that are a combination of employee and employer contributions.
Such plans typically save companies money in terms of reduced contributions and leave employees with more responsibility in funding their retirement plans and making investment decisions.
In many cases, employees have opted for “safe” investments that are not prone to swings in the financial markets, but offer marginal returns that might not be sufficient for a comfortable retirement.
DuPont, unlike many companies, has not completely outsourced its pension system and has offered a mixture of investment options.
The merger, which is slated to be completed at the end of the month, under current plans, will lead to the combined companies splitting up into three publicly traded entities.