Opinion ID: 626080
Heading Depth: 2
Heading Rank: 3

Heading: The Plan's Benefit Formula

Text: In addition, a defined benefit pension plan generally provides a formula whereby a participant can determine what benefit, if any, is payable to him. The Delta Plan provides such a formula, using the same factors for both retirement and termination benefits. To determine a participant's benefit, three factors are used: (1) a participant's Final Average Earnings (FAE); [2] (2) his Primary Social Security Benefit (PSSB); [3] and (3) his months-of-credited-service-to-30-years ratio. The final average earnings benefit is the product of the credited-service ratio and the difference of 60% of the FAE less 50% of the PSSB. The full amount of this monthly benefit is payable to participants beginning at age 65; participants may begin receiving a reduced benefit as early as age 52. The deduction of the PSSB is commonly referred to as the Social Security offset. [4] The Plan's formula for determining the Social Security offset is the center of this case's dispute. Delta has amended the formula for the Social Security offset twice in recent years, in amendments known as Amendments Seven and Eight. Only Amendment Eight is challenged here. The next sections describe how the Social Security offset worked before and after each Amendment.