Oneida pensions assumed by PBGC

By Caroline Salls

Pittsburgh, Sept. 6 - Oneida Ltd.'s pensions have been assumed by The Pension Benefit Guaranty Corp., according to a PBGC news release.

The PBGC said it assumed responsibility for the pensions of nearly 1,900 Oneida workers and retirees.

The U.S. Bankruptcy Court for the Southern District of New York ruled that Oneida satisfied the legal test for terminating its underfunded pension plan, and the PBGC has determined that the company meets all criteria under federal law to transfer the plan's liabilities to the pension insurance program.

Oneida's employee retirement plan ended as of May 31, and the plan is 31% funded, with $21.6 million in assets to cover $72 million in promised benefits.

The PBGC said it estimates that it will be responsible for $48.3 million of the $50.4 million shortfall.

Oneida's two other pension plans, the Buffalo China Salaried Plan and the Buffalo China Union Plan, will continue to be sponsored by the company.

According to the release, workers covered by the Oneida employee retirement plan will receive their pension benefits from the PBGC. Retirees will continue to receive monthly benefit checks without interruption, and other workers will receive their pensions when eligible to retire.

Under federal pension law, the maximum guaranteed pension at age 65 for participants in plans that terminate in 2006 is $47,659 per year. The maximum guaranteed amount is lower for those who retire earlier or elect survivor benefits.

In addition, the release said some early retirement subsidies and benefit increases made within the past five years may not be fully guaranteed.

Oneida retirees who draw a benefit from the PBGC may also be eligible for the federal Health Coverage Tax Credit, according to the release.

Oneida, an Oneida, N.Y.-based maker of flatware, dinnerware, crystal and metal serving pieces, filed for bankruptcy on April 2. Its Chapter 11 case number is 06-10489.

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