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A 'BGC pension Benefit Guaranty Corporation ~~t~~t~~~~~~~~~.~~~s~.~~~~ 1200 K Street, N W, Washington, D.C. 20005-4026 

MAY 0 3 2005 

Re: Case 192187, -1 

~uro-~est Corporation ("Duro-Test" or 

I the "companyn) Pension plan (the "Plan") 

Dear 1 1 

The Appeals Board has reviewed your appeal of PBGC's April 12, 

2004 determination that you are not entitled to a spousal benefit 

under the Plan. For the reasons stated below, we found no basis 

presented in your appeal for changing PBGC's determination. 

Benefit Determination and Aoweal 

PBGC's letter stated that you are not entitled to a spousal 

benefit, because your late husband, did 

not have the required ten years of service to be vested in the 

Plan. 

In your June 17, 2004 appeal, you stated your husband was told 

that if he returned to Duro-Test, he would be able to vest in its 

pension plan. You stated that, upon his return, he worked directly 

for the President of Duro-Test, You - enclosed a copy of a May 3, 2004 letter, sent to you by 

in which he wrote: "To the best of my recollection, 

worked directly for me at Duro-Test Corporation and 

was included in our pension plan." 

Pension Records 

PBGC's auditors found no record that your late husband was a 

participant in the Plan. 1 is not included in the 

Plan's actuarial valuatiol! listings. 

With your authorization, PBGC obtained your husband's earnings 

data from the Social Security Administration ("SSA") from 1957 

through 1985. The Duro-Test Summary Plan Description effective 

August 1, 1976 (the "1976 SPD") states that the Plan covers eligible 

I Date of Termination of Emplovment 
employees of Duro-Test Corporation, Tungsten Products Corporation, 

Jewel Electricity Products, Inc., Duro-Test International 

Corporation, Arc Ray Electric Corporation, Luxor Lighting Products, 

Inc., and Duro-Lite Lamps, Inc. After the first quarter of 1976, your 

husband's earnings were reported either by companies not included in 

the list above or from self-employment. Therefore, the Board found 

thatterminated employment under the Plan during the 

first quarter of 1976 (i.e., on or before March 31, 1976). For your 

reference, we have enclosed a copy of your husband's SSA earnings and 

a copy of the 1976 SPD. 

Deferred Vestinq under the Duro-Test Plan 

The 1976 SPD is the earliest Plan document in PBGC's possession. 

Under the Employee Retirement Income Security Act ("ERISA"), the 

Duro-Test Plan was required to provide one of a number of minimum 

vesting schedules as of the beginning of the Plan year commencing in 

1976. In compliance with ERISA, the 1976 SPD provided a deferred 

vested benefit to covered employees who completed 10 years of service 

effective August 1, 1976 (the beginning of the 1976 Plan year). 

The Director of Personnel at Duro-Test in 1976 was 71 

In a February 23, 2005 telephone conversation with the 

Board's staff, stated that the Duro-Test Plan did not 

include a deferred vested benefit prior to the amendment adopted to 

comply with ERISA. The Board notes that prior to the enactment of 

ERISA, most pension plans did not include a deferred vested benefit. 

PBGC's actuarial valuation identified 1,007 individuals who were 

entitled to benefits under the Plan at Plan termination. We reviewed 

the Plan's practice with respect to these individuals, and we did not 

find a single example of a participant who earned a deferred vested 

benefit prior to August 1, 1976. 

For the reasons given above, the Board found that the Duro-Test 

Plan did not provide a deferred vested benefit to employees who 

terminated employment prior to August 1, 1976. As noted earlier, the 

Board found thatterminated employment under the Plan 

on or before March 31, 1976. Therefore, the Board found that 

was not entitled to a deferred vested benefit under 

the Duro-Test Plan. Consequently, the Board found that you are not 

entitled to a spousal benefit. 

PBGC's Determination Reaardina 1 years of Service 

PBGC's determination was based on the conclusion that 

did not complete the 10 years of service required to 

vest under the earliest Plan document in PBGC's possession. Your 
husband's SSA earnings data indicate that he worked for Duro-Test (or 

one of the other companies listed in the 1976 SPD) for (1) about six 

years and five months from the last quarter of 1958 into the second 

quarter of 1965 and (2) about nine years and three months from the 

first quarter of 1967 through the first quarter of 1976. Between 

these two periods, he was not employed by Duro-Test (or a related 

company) for a period of at least one year and six months. 

In most pre-ERISA plans, an employee's eligibility for a benefit 

was based on continuous service measured from the employee's last 

date of rehire. The 1976 SPD states: 

Employees who were members of the Pension Plan on August 1, 

1976 will also receive credited service for time worked as 

"continuous employment" prior to that date. "Continuous 

employment" is essentially the service you accumulated 

since your most recent date of hire. 

It is unlikely that the Plan in effect prior to the 1976 SPD was more 

generous 

continuous employment 

than the 1976 

would 

SPD. 

have 

Thus, 

been 

it 

measured from his 

appears that 71 

last date of 

rehire and that he did not complete 10 years of continuous service. 

In your appeal, you stated that your husband was told that if 

he returned to work for Duro-Test he could vest in the Duro-Test 

pension plan. According to SSA records, your husband returned to work 

at Duro-Test in the first quarter of 1967. The Duro-Test Plan became 

effective August 1, 1968. Thus, the oral assurances that you recall 

your husband received pertained to the provisions of a pension plan 

that had not yet been established. 

The letter which you enclosed with your appeal states that your 

husband was employed by the Company and included in the Plan, but 

does not state that he was vested in the Plan. In a February 23, 2005 

telephone conversation (and a February 24, 2005 voice mail message), 

the Company's former Director of Personnel recalled discussing 1 situation with a "senior Company executive" and 

concluding thatdid not complete ten years of vesting 

service, because he incurred a break in continuous service. 

For the reasons given above, the Board agreed with PBGC's 

determination thatdid not complete the 10 years of 

service required to vest under the 1976 SPD (the earliest Plan 

document in PBGC's possession). The Board, however, based its own 

decision on its finding that when terminated 

employment, the Plan did not provide a deferred vested benefit, 

regardless of the employee's length of service. 
Decision 

The Board found no basis presented in your appeal for changing 

PBGC'S determination. This is the final agency action with regard to 

the issues decided in your appeal. 

\ 

You may, if you wish, seek court review of this decision. If you 

need other information from PBGC, please call the Customer Contact 

Center at 1-800-400-7242. 

Sincerely, 

Michel Louis 

Member, Appeals Board 

Enclosures: 

1. SSA Itemized Statement of Earnings for1 1 

2. The Duro-Test 1976 Summary Plan Description.