A measure introduced today by U.S. Sens. Al Franken and Amy Klobuchar (D-Minn.) would ensure that people who become disabled after their troubled pension plans have been taken over by the federal government can access disability benefits without penalty. The Disability Pension Fairness Act was authored by Sen. Franken, and Sen. Klobuchar signed on as an original cosponsor.
The legislation would allow workers with pensions at the Pension Benefit Guaranty Corporation (PBGC), which takes over plans when employers cannot pay promised benefits, to begin receiving their pension benefits early without penalty if they are declared disabled under Social Security. Currently, workers who become disabled after their plan is taken over by PBGC must wait until they turn 65 to receive any benefits, or their benefits will be reduced.
"Steel workers on the Iron Range whose pension plans have been taken over by PBGC have already suffered reductions in benefits," said Sen. Franken. "Workers who are declared disabled after their company goes under shouldn't be further penalized because of when they became disabled. People with disabilities should be able to access their rightfully earned benefits when they need them, without penalty, and my bill would ensure that."
"Workers on the Iron Range deserve to know that they will be protected in the event they become disabled," Klobuchar said. "This act is an important step in ensuring that those who suffer from disabilities will have access to the benefits they earned from years of hard work when they need them most."
The Disability Pension Fairness Act would:
Allow anyone declared disabled under Social Security to access their PBGC benefits early without penalty, regardless of whether they met their plan's requirements for a total disability benefit before the plan's termination date.
Exempt all persons with disabilities from the PBGC monthly maximum limit. Just like those eligible for PBGC disability benefits, the legislation would except individuals declared disabled under Social Security from the PBGC monthly maximum limit.
Hold all other PBGC pension beneficiaries harmless. Under this legislation, PBGC would be prohibited from reducing benefits to other plan participants in order to implement the legislation.
End the arbitrary distinction between those eligible for disability benefits under Social Security and those eligible under PBGC.