A 

(0 

-J 

e 

m 

W 

I 

+ 1 \wx35 

m 

0 

I- #\ Pension Benefit Guaranty Corporation 

7 1200 K Street. N.W., Washington, D.C. 20005-4026 

* 

DEC 0 9 M02 

Re: Appeal ~ranklin Steel 

Company Hourly Pension Plan (the "Plan") 

Dear 1 

We are responding to your January 21, 2002 appeal of PBGC's 

corrected benefit determination letter dated January 9, 2002. For 

the reasons stated below, we granted your appeal and found your 

client, entitled to a Permanent Incapacity 

Retirement benefit retroactive to the date of Plan termination, 

March 31, 1994. 

In your January 21, 2002 appeal, you stated that although 

PBGC's January 9, 2002 determination informed your client that he 

was entitled to a Rule-of-65 retirement, it did not address 

eligibility for a Permanent Incapacity Retirement 

benefit. You noted that you had previously argued that 71 

was entitled to a Permanent Incapacity Retirement benefit in 

correspondence addressed to the Appeals Board dated July 6, 1998. 

Although PBGC's January 9, 2002 determination letter did not 

explicitly address entitlement to a Permanent 

Incapacity Retirement benefit, a review of the administrative 

record reveals that PBGC's Insurance Operations Department ("IOW') 

concluded that 1 was not entitled to a Permanent 

Social 

Incapacity 

Security disability 

Retirement benefit 

award 

because the 

was set after the 

date of 71 

date Plan 

termination. 

On July 25, 2002, you resubmitted a complete copy of your 

correspondence of July 6, 1998, and added a cover letter 

summarizing your argument: 

'I request your review of these medical records, which I 

submit as evidence of the disability of my client, 1 prior to the March 31, 1994 plan 

termination date. Eligibility for a Permanent Incapacity 

Retirement benefit does not require a Social Security 
Disability award [which received as of 

October 6, 1994, his SOch birthday]; rather the degree of 

disability must preclude the employee from 'engaging in 

any employment of the type covered by the Basic 

Agreement.' Section 2.5" 

In the cover letter to your July 6, 1998 correspondence, you 

stated: 

''I suffered a compensable work injury to his 

back on December 11, 1987 at Franklin Steel Company. His 

worker's compensation claim was accepted by notice of 

compensation payable dated January 11, 1988. His last 

day of work at Franklin Steel was on or about 

September 11, 1988. He continued to receive weekly total 

disability workers' compensation benefits until 

July 1996, when his benefits were commuted to a lump 

sum." 

With respect to Social Security disability 

award, you stated: 

"Under Social Security law and regulations, presumptions 

of residual capacity to perform sedentary work change 

upon reaching age 50. Therefore, the Social Security 

award should not be construed to suggest that no 

disability preexisted the onset date of October 6, 1994. 

In fact, the medical evidence noted by the ALJ 

established that suffered chronic L4-5 disc 

problems, degenerative joint disease and limited range of 

motion about the cervical and lumbar spines." 

The Board concurred with your reasoning regarding the date of your 

client's Social Security disability award. 

Your July 6, 1998 correspondence includes a Bureau of Workers' 

Compensation document, "Supplemental Agreement for Compensation for 

Disability or Permanent Injury" ("Supplemental Agreement"). The 

Supplemental Agreement states: 

"The claimant's (-1 condition changed 

as of 07/09/96. The claimant is capable of performing 

light duty work that has been made available to him by 

Franklin Steel and The PMA Group [authorized agent or 

insurance carrier] that would reduce the payment of 

benefits from total to partial . . .. Although the 

claimant is capable of performing the light duty 

described above, he has chosen not to accept that work 
but, instead, has voluntarily resigned from the work 

force ." 

The Supplemental Agreement indicates that 1 was injured on 

December 11, 1987, and that, as of July 9, 1996, his condition 

changed so as to make him capable of light duty. Thus, the 

Supplemental Agreement supports the conclusion that as of Plan 

termination, which was prior to July 9, 1996, was not 

capable of light duty and, as such, was not capable of "engaging in 

any employment of the type covered by the Basic Agreement." 

Decision 

Based on the evidence and argument presented in your appeal 

and on the Board's disagreement with PBGC's reason for denying your 

client's claim, the Board found thatwas entitled to a 

Permanent Incapacity Retirement benefit as of Plan termination. 

PBGC's Insurance Operations Department will contact your client 

directly regarding the payment of amounts due him retroactive to 

Plan termination, including interest. We appreciate your patience 

while your appeal has been pending. If you need other information 

from PBGC, please call the Customer Service Center at 1-800-400- 

7242. 

Sincerely, 

Linda M. Mizzi 

Member, Appeals Board