Company Takeover - LTD/Group Benefits etc


#1

Hello,

My company was taken over by bigger International Corporation.

I have been on LTD for 5 years with Employer covering group benefits and pension.

I am concerned with new takeover that my benefits/pension will be terminated. Can that be the case? Would it be the my employment was terminated and I would receive severance.

I think my LTD benefits are safe, but am worried about that as well. Uncertainty is very stressful.


#2

Your existing LTD is a contract between you and the insurance company.
The company has no involvement in that.
Even if the new company has a different insurance company and new terms for LTD, you still fall under the old term.
I am pretty sure anyways.

Your group benefits would probably be terminated if your job is terminated.
I don’t know about severance but from what I have read, you probably wouldn’t get that.
I have no idea about your pension, it depends on details you should discuss with your financial advisor.
If it is defined contribution then I think the the current value would convert to a LIRA and you would get it when you retire (if it is invested in mutual funds the value you get at retirement could be more or less).


#3

Pensions and group benefits can be negatively affected by these takeovers. Jammer is correct that normally and open LTD claim with an insurance company will not be affected…UNLESS your LTD claim is actually being paid under an employer-run long-term disability program (as opposed to an actual LTD policy). This is worth looking into. It can be confusing because employers hire the major insurance companies to administer he employer-run LTD programs, so form the outside it looks like a regular LTD plan. Just ask your claims rep if this plan is under a group policy. They will know.


David Brannen

Disability Lawyer with Resolute Legal

The response posted above is based on the limited factual information made available and is not intended as a full and complete response to the question. The only reliable manner to obtain complete and adequate legal advice is to consult with a lawyer, fully explain your situation, and allow the lawyer enough time to research the applicable law and facts required to give an adequate opinion. The basic information provided above is intended as a public service only, a full one-on-one discussion with a lawyer should be done before taking any any action. The information posted on this forum is available to the viewing public and is not intended to create a lawyer client relationship with any person. If you want one-on-one advice, please click here to request a free consultation or call toll free 1-877-282-5188 to speak with a member with our disability claim support team.


#4

@David_Brannen. Thanks for reply.

If benefits/pension are cancelled, would that be case for severance? Or constructive dismissal?


#5

Possibly, but normally they are not cancelled outright. You may be migrated over to new benefits or pension plan. The new ones could be better than previous. In any event, your current pension plan money is yours, so you would not lose the money unless there was a total bankruptcy. Pension are highly regulated by government so companies cannot simply steal the money or use it for other purposes and leave employees in the cold.


David Brannen

Disability Lawyer with Resolute Legal

The response posted above is based on the limited factual information made available and is not intended as a full and complete response to the question. The only reliable manner to obtain complete and adequate legal advice is to consult with a lawyer, fully explain your situation, and allow the lawyer enough time to research the applicable law and facts required to give an adequate opinion. The basic information provided above is intended as a public service only, a full one-on-one discussion with a lawyer should be done before taking any any action. The information posted on this forum is available to the viewing public and is not intended to create a lawyer client relationship with any person. If you want one-on-one advice, please click here to request a free consultation or call toll free 1-877-282-5188 to speak with a member with our disability claim support team.