Promoting Lay Retirement Benefits
by David Hawkins* 
With the approved General Conference 2004 legislation calling on churches to consider providing retirement benefits for eligible lay employees beginning January 1, 2006, several conferences are taking proactive measures to get the word out regarding the General Board of Pension’s new lay retirement plan, the United Methodist Personal Investment Plan (UMPIP). What do the churches of the Tennessee Conference need to know about this? What message do we want to send regarding lay employees and the work they do in our local churches?
First, let’s look at the directive from the General Conference legislation to local church Staff Parish Relations Committees, as stated in the 2004 Discipline paragraph 259.2g(12): “the committee shall recommend that the church council provide, effective on and after January 1, 2006, 100 percent vested pension benefits of at least three percent of compensation for lay employees of the local church who work at least 1040 hours per year, are at least 21 years of age, and have at least one year of permanent service. The church council shall have authority to provide such pension benefits through either a denominational pension program administered by the General Board of Pension and Health Benefits or another pension program administered by another pension provider.” In other words, the recommendation of lay retirement benefits is now a part of the official duties of the SPR Committee.
Therefore, the SPR Committee should help the church determine what lay staff the church employs that work at least 20 hours per week, are at least 21 years of age, and have at least 1 year of permanent service. Then, the SPR Committee should bring a recommendation to the church council to provide a retirement benefit for these eligible employees. If the church council approves then the church becomes the plan sponsor for these benefits through a pension provider. The General Board of Pension administers pension plans for lay employees, but local churches are free to contract with a pension provider of their choice. The General Board sent two UMPIP postcard mailings earlier this year and will send out one more this September to those churches that have not responded. Postcard responses to the General Board need to be sent by November 1 in order to adopt UMPIP by January 1, 2006.
Based on the minimum level of 3%, a local church lay employee earning $20,000 per year would receive from the church an annual contribution of $600 ($50/month) into his or her retirement account. An employee earning $12,000 per year would receive a contribution of $360 ($30/month) into his or her retirement account.
Even though providing a lay retirement benefit is not strictly mandatory, it certainly would send a message of respect and appreciation for the work that lay employees do in our local churches. If you need more information about the Lay Employee Retirement Plan, please contact the General Board of Pension 1-800-851-2201,or the Tennessee Conference Benefits Officer (Director of Administrative Services, David B. Hawkins) 1-800-359-1162.
*David B. Hawkins is Director of Administrative Services for the Tennessee Annual Conference.
With the approved General Conference 2004 legislation calling on churches to consider providing retirement benefits for eligible lay employees beginning January 1, 2006, several conferences are taking proactive measures to get the word out regarding the General Board of Pension’s new lay retirement plan, the United Methodist Personal Investment Plan (UMPIP). What do the churches of the Tennessee Conference need to know about this? What message do we want to send regarding lay employees and the work they do in our local churches?
First, let’s look at the directive from the General Conference legislation to local church Staff Parish Relations Committees, as stated in the 2004 Discipline paragraph 259.2g(12): “the committee shall recommend that the church council provide, effective on and after January 1, 2006, 100 percent vested pension benefits of at least three percent of compensation for lay employees of the local church who work at least 1040 hours per year, are at least 21 years of age, and have at least one year of permanent service. The church council shall have authority to provide such pension benefits through either a denominational pension program administered by the General Board of Pension and Health Benefits or another pension program administered by another pension provider.” In other words, the recommendation of lay retirement benefits is now a part of the official duties of the SPR Committee.
Therefore, the SPR Committee should help the church determine what lay staff the church employs that work at least 20 hours per week, are at least 21 years of age, and have at least 1 year of permanent service. Then, the SPR Committee should bring a recommendation to the church council to provide a retirement benefit for these eligible employees. If the church council approves then the church becomes the plan sponsor for these benefits through a pension provider. The General Board of Pension administers pension plans for lay employees, but local churches are free to contract with a pension provider of their choice. The General Board sent two UMPIP postcard mailings earlier this year and will send out one more this September to those churches that have not responded. Postcard responses to the General Board need to be sent by November 1 in order to adopt UMPIP by January 1, 2006.
Based on the minimum level of 3%, a local church lay employee earning $20,000 per year would receive from the church an annual contribution of $600 ($50/month) into his or her retirement account. An employee earning $12,000 per year would receive a contribution of $360 ($30/month) into his or her retirement account.
Even though providing a lay retirement benefit is not strictly mandatory, it certainly would send a message of respect and appreciation for the work that lay employees do in our local churches. If you need more information about the Lay Employee Retirement Plan, please contact the General Board of Pension 1-800-851-2201,or the Tennessee Conference Benefits Officer (Director of Administrative Services, David B. Hawkins) 1-800-359-1162.
*David B. Hawkins is Director of Administrative Services for the Tennessee Annual Conference.
