Defined Contribution Plan
Defined Contribution Plan Information
The Board of Trustees added a new pension plan for Local 12 members effective July 1, 2018. The new Defined Contribution Plan (sometimes referred to as Annuity Fund) is in addition to the Operating Engineers Defined Benefit Pension Plan (DBP) and provides a valuable supplement to your retirement financial security.
The Defined Contribution Plan (or DCP) is an individual account type pension plan where an account is setup for every member working under a Local 12 bargaining agreement which includes the Defined Contribution Plan. For every hour you work, $3.50 is credited to your individual account. All contributions into your individual account will be invested and will grow and compound over time. You are 100% vested in your individual account at all times and from the very first hour reported. Upon retirement, you will be entitled to the full balance in your individual account. You can receive your individual account balance in a lump sum or in one of a variety of lifetime annuity options for you alone or for you and your surviving spouse. There is no ability to add additional monies to your individual account over and above the $3.50 per hour that has been negotiated and approved by the membership and there are no loans or hardship withdrawals.
The Board of Trustees selected John Hancock to perform the individual account recordkeeping services and to invest the assets. The assets are invested in a stable value mutual fund. Individual accounts are valued daily, and members receive quarterly statements on the activity and performance of their individual accounts.
Because this new Trust started with zero assets and individual account balances will be relatively small during the first few years, Local 12 has agreed to cover all administrative costs of the DCP until it can stand on its own.