Pension Benefit Guaranty Corporation 

Protecting America's Pensions 1200 K Street, N.W., Washington, D.C. 20005-4026 

June 15,2007 

Re: Appeal 2006-0246, Case # 196479, ABC Rail Products Corporation Retirement and 

Disability Pension Plan (the "ABC Rail Plan") 

Deari"-----__ 

The Appeals Board has reviewed your appeal ofPBGC's April 15,2005 determination of 

your benefit under the Deferred Vested Retirement provisions of the ABC Rail Plan. For the 

reasons explained below, we changed PBGC's determination by finding that you are entitled to a 

benefit under the Plan's 75/80 Retirement provisions. PBGC's Benefits Administration and Payment 

Department will send you a new determination of your 75/80 benefit amount and annuity start date, 

with a new 45-day appeal right. 

PBGC's Determination and Your Appeal 

PBGC's letter said that you are entitled to a Deferred Vested benefit of $549.50 per month, 

ifpaid as a Straight Life Annuity with no survivor benefits beginning February[], 2015, the first of 

the month following your 65th birthday. PBGC included· a benefit statement showing the 

information PBGC used to calculate your benefit. This statement also explained that you could 

begin receiving. a benefit in a reduced amount as early as FebruaryO, 2010. 

Your May 22, 2005 appeal said that you feel you met the necessary requirements to begin 

collecting your pension immediately. Congressman Jesse L. Jackson, Jr. submitted additional 

information to supplement your appeal on April 20, 2007. 

Background 

ABC Rail Products Corporation acquired Abex Corporation on July 18,1987. ABC Rail 

established the ABC Rail Corporation Retirement and Disability Pension Plan for its employees, 

effective July 8, 1987. Before that date, ABC Rail employees participated in the Abex Corporation 

Pension Plan. Service accrued under the Abex Plan is considered service under the ABC Rail Plan 

for purposes of vesting and calculating accrued benefits. The total ABC Rail Plan benefit is then 

offset by any benefit payable under the Abex Plan. 
The ABC Rail Plan tenninated, effective January 12, 2002, without sufficient assets to 

provide all benefits PBGC guarantees under Title N ofthe Employee Retirement Income Security 

Act (ERISA), and PBGC became the Plan trustee. The tenns of the ABC Rail Plan, the provisions 

of ERISA and PBGC's regulations and policies detennine a participant's entitlement to a guaranteed 

benefit. PBGC's regulations require that, for a benefit to be guaranteed, a participant must satisfy 

the conditions of the plan necessary to establish the right to receive the benefit before the plan's 

tennination date (see 29 Code of Federal Regulations §§4022.3. and 4022.4(a)(3)). 

75/80 Retirement 

Under section 3.B of the Schedule of Benefits for ABC-Chicago Heights that was in effect 

when the Plan tenninated, a participant is entitled to 75/80 Retirement ifthe participant: meets one 

of two specified age and service requirements and one of three specified employment conditions: 

Age and Service Requirements: 

1. Age 55 with fifteen or more years of vesting service with combined years of 

age and service equal to 75 or more. 

2. Fifteen or more years of vesting service with combined years of age and 

service equal to 80 or more. 

Employment Conditions: 

1. Tenninated from employment by reason of pennanent shutdown of his plant, 

department or subdivision thereof. 

2. Is laid off or continuously disabled for two years ... provided he needed not 

more than two years of age and not more than two years of service since the 

commencement of such layoff or disability in order to meet the aforesaid age 

and service requirements. 

3. Is laid off and deemed by the company to have little likelihood of being 

recalled to work. 

A participant who meets the requirements for 75/80 Retirement is eligible for an immediate pension 

computed in the same manner as a regular age-65 retirement on "the basis of the pension accrual 

rates and his benefit service to tennination of employment or, if earlier, the end ofthe 1;1,vo (2) year 

period from his last day worked." 

PBGC's benefit determinations for Chicago Heights participants assumed that operations at 

that facility ceased on January 12, 2002, which is also the Plan's tennination date. Consequently, 

Chicago Heights participants like you who were actively employed in early January, 2002 could not 

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be eligible for 75/80 Retirement because they could not have met the employment condition for that 

benefit before the Plan's termination date, as PBGC's regulations require. 

PBGC's files show the following information for you: ' 

1. Date of birth I I 

2. Date of hire I I 

3. Facility location Chicago Heights, IL 

4. Employment termination date January D 2002 

5. Plan termination date January D 2002 

6. Age as of Plan termination date 5000 years 

7. Vesting service as of Plan termination date 2[J.00 years 

8. Age plus service as of Plan termination date 80.00 

9. Benefit type Deferred Vested 

PBGC determined that you 'were entitled only to a Deferred Vested benefit because, although you 

did meet the 80-point requirement for a 75/80 benefit before January 12, 2002, you did not meet the 

employment condition before that date. 

Discussion 

During one of our telephone conversations, you told me that the- company "locked out" all 

the employees on Friday, January 11, 2002. You said you went to work that morning, there were 

security guards at the gates, and the bosses told employees the plant was closed and to go home. 

The additional information Congressman Jackson submitted on your behalf includes a document, 

dated January 11, 2002 and signed by the Chicago Heights plant manager and by the union 

president, stating that "we were told that we are to tell all the Employees that they have been 

terminated and not to come back to work on Monday." 

The Appeals Board researched PBGC's plan and participant files. We found some evidence 

suggesting that the Chicago Heights shutdown date could have been either Friday, January 11,2002 

or Saturday, January 12, 2002. We found no evidence specifically documenting a January 12, 2002 

shutdown. 

Based on the information available to the Appeals Board, we concluded that (1) operations 

at the Chicago Heights facility shut down on January 11, 2002 and (2) as a result, January 11, 2002 

is also your employment termination date. Thus, the Board found that you me:t both the 

employment condition and the age and service requirement for 75/80 Retirement before the Plan's . 

termination date. 

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Decision 

Having applied the law, Plan provisions and PBGC's regulations and policies to the facts in 

this case, the Appeals Board changed PBGC's detennination by finding that you are entitled to a 

benefit under the Plan's 75/80 Retirement provisions. 

We will forward a copy of this decision to PBGC's Benefits Administration and Payment 

Department (BAPD), the organization responsible for detennining and paying benefits. lBAPD will 

send you a new detennination of your 75/80 benefit amount and annuity start date, with a new 45-

day appeal right. They will also compute the amount of any backpayments you may be owed and 

pay them to you in a lump sum with interest. 

Meanwhile, if you have questions, please call PBGC's Customer Contact Center at 1-800-

400-7242 . 

. Sincerely, 

Linda M. Mizzi 

Member, Appeals Board 

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