Making Your Benefits Communications Oscar-Worthy

The Oscar awards were on TV this past Sunday but since there were no actors I was rooting for, my husband decided we were going to rent a movie so he picked Tower Heist, which after watching it I can say is definitely not worthy of an Oscar.  So what does Tower Heist have to do with benefits communication?

In the movie, Eddie Murphy is a street thug and Ben Stiller plays a luxury condo manager for the Tower, an upscale building in New York City.  They’ve known each other since daycare, and Ben ends up enlisting Eddie’s help to plan a heist against an evil resident of the Tower, played by Alan Alda.  Alda is a Wall Street swindler who has been managing the Tower’s pension plan and personal assets of the staff until he is charged with fraud.  FBI agent Tea Leoni tells Stiller that the pension has  lost everything and that after the trial she expects they will get nothing back.  Alda was entrusted with managing the pension funds since he sat on the Tower’s board of directors and had lived in the building for over a decade.  Stiller tells his staff they’ve lost everything in their pension, which causes the ready-to-retire doorman to try to commit suicide.

So what’s wrong with this picture?  Since the employees had no say in how the retirement funds were invested and they had to reach a certain age prior to retiring, we can probably assume that their plan would have been a defined benefit pension plan.  With a defined benefit pension plan, the risk is not on the participant. It is on the plan sponsor so the employer would have had to make up the loss.  According to ERISA rules, Alan Alda’s character would also have been personally responsible as a fiduciary since he was a board member and the investment manager.  In a worst case scenario, if the fraud caused the Tower to go bankrupt, then the pension would have had the protection of the PBGC. So make sure you take red carpet steps  to communicate these safety nets more effectively to your own workforce if you have a defined benefit pension plan.  With the recent market volatility we’ve been experiencing over the past few years, your employees will feel much better about their pension plan if you remind them of the ERISA rules and the coverage provided by the Pension Benefit Guarantee Corporation.

Another movie blooper occurs when the building concierge gets fired due to Stiller’s antics and the fired employee cries the blues about losing his health insurance.  His wife is eight months pregnant so he is worried that he’ll now have to come up with $20,000 for the baby’s birth if he doesn’t have his health insurance.  With the number of Tower employees that are featured in the movie,  it is obvious there are more than the 20 employee minimum needed to be covered by COBRA.  Even if the concierge were fired for misconduct, he still would have been eligible to continue his employer-sponsored health plan for the birth of his child since COBRA requires the employer to give the terminated employee the right to continue coverage for up to 18 months.  He would have been responsible for paying the entire premium plus up to a 2% administrative fee but that cost would have been a lot less than the hospital bill for having a baby uninsured.   Your employees will consider you the best nominee for supporting role if you remind them of this safety net for health insurance coverage.

You can gain Oscar buzz in the visual effects category by considering multiple channels of benefits communication.  Post a reminder about COBRA coverage on your intranet and in your monthly newsletter, hold a workshop on your pension benefits, and consider all the misconceptions that your employees may have that can be overcome by spreading the word about all the safety nets that are in place to protect their workplace benefits.

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