As of 2015, the Central States Pension Fund is a defined benefit plan that pays retirement benefits to its qualified participants, according to the pension fund. The fund calculates benefits based on employees' ages and how much and how long they have contributed to the fund. Participants must have either 600 hours, 75 days or 20 weeks of employer contributions to the fund on their behalf in a 12-month period to be eligible for fund benefits.
Central States Pension Fund participants vest after five years of participation, explains the pension fund. Fund participants must participate for 10 years to vest if they left the fund before 1999. At age 65, vested participants have the right to receive retirement benefits each month.
Under the Multiemployer Pension Reform Act of 2014, the Central States Pension Fund filed an application on Sept. 25, 2015, to obtain approval for a pension rescue plan from the U.S. Department of the Treasury, notes the pension fund. The fund seeks approval to ensure that it continues to provide plan benefits to its participants. Approximately 212,000 retirees and survivors receive monthly benefit payments from the fund.
Central States Pension Fund officials say there is only enough money in the fund for the next 10 years unless they reduce benefits to retirees, reports WQAD News 8. If the government approves the proposed rescue plan, some beneficiaries may experience monthly reductions up to 70 percent, or $1,500.