ERISA-Tenth Circuit Rules That Retiree Cannot Convert His Pension Benefit To Disability Benefit

In Martinez v. Plumbers & Pipefitters Nat’l Pension Plan, No. 14-1315 (10th Cir. 2015), Joseph Martinez was a long-term participant in the Plumbers and Pipefitters National Pension Plan, a multiemployer defined benefit pension plan governed by ERISA (the “Plan”). Following some health problems, Martinez retired from plumbing in 2004 at age 56 and took advantage of the Plan’s early retirement pension. After a few years in retirement, he felt well enough to resume working, and his pension was suspended during that time according to rules that prohibit retirement benefits during disqualifying employment. When he retired again in 2009, he asked the National Pension Fund to allow him to convert the pension benefits he previously elected from an early retirement pension to a disability pension–a change that would entitle him to higher monthly payments.

The Plan denied the conversion and the district court upheld the denial. In analyzing the case, the Tenth Circuit Court of Appeals (the “Court”) agreed that the Plan language is unambiguous and allows Plan participants to apply for and receive only one type of pension benefit for life absent several clearly delineated exceptions, none of which apply to Martinez. Accordingly, the Court affirmed the Plan’s denial of Martinez’s claim for disability benefits and the district court’s decision on the matter.

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