UPS offering some former employees lump-sum payments


United Parcel Service Inc., Atlanta, is offering about 50,000 U.S. pension plan participants a lump-sum window, spokesman Glenn Zaccara said in an e-mail.

The population consists of former employees, from non-union and some union plans, who are vested in their respective U.S. pension plans but who have yet to retire, Mr. Zaccara said. The population is restricted to former employees who terminated their UPS employment between July 2003 and June 2016.

“Like many other companies, UPS is providing some former employees with the opportunity and flexibility to choose a lump-sum distribution, rather than having their money tied up in a pension plan. This common practice benefits former employees who voluntarily elect to free up their money, while also benefiting the company by simplifying plan administration,” Mr. Zaccara said.

He did not say how much in liabilities the population represents. The window for the participants to accept the offer ends Nov. 12 and payments are expected to be made before the end of the year.

As of Dec. 31, U.S. pension fund assets totaled $28.9 billion, and projected benefit obligations totaled $36.8 billion, for a funding ratio of 78.5%, according to the company's most recent 10-K filing with the Securities and Exchange Commission. The company announced in the 10-K filing it planned to contribute $1.16 billion to its U.S. pension funds in 2016.

The UPS Retirement Plan, which had $18.2 billion in assets as of Dec. 31, according to the company's most recent Form 5500 filing. The plan was closed to new non-union hires on July 1, the company's most recent 10-Q filing said.