Second Circuit Holds Pension Plan Participant Is Not Entitled to Actuarial Increase in Benefits Due to Working Beyond Normal Retirement Age

In Guzman v. Bldg. Serv. 32BJ Pension Fund, et al., No. 23-8032, 2024 WL 4431100 (2d Cir. Oct. 7, 2024), Plaintiff-Appellant Carlos Guzman, proceeding pro se, appealed the district court’s judgment dismissing his ERISA claims against the Building Service 32BJ Pension Fund (the “Fund”) and others in a lawsuit where he alleged that he was entitled to an actuarial increase in his pension payments because he deferred claiming his pension benefits for several years after reaching normal retirement age. In an unpublished opinion, the Second Circuit agreed with the district court that Plaintiff’s claims are foreclosed by the plain language of the pension plan.

Applying the federal common law of rights and obligations under ERISA-regulated plans and interpreting the unambiguous language in an ERISA plan according to its plain meaning, the court found that under the unambiguous terms of the 2018 Summary Plan Description (the “SPD”)—the operative plan document—Plaintiff was not eligible for an actuarial increase to his pension benefits. The SPD makes clear that an employee is entitled to an actuarial increase only if after terminating Covered Employment, they wait to begin the pension until after normal retirement age. Plaintiff did not terminate his Covered Employment after reaching normal retirement age. The court rejected Plaintiff’s argument that the SPD’s suspension rules that apply to individuals who retire, begin receiving benefits, and then return to work, should apply to him.

On appeal, Plaintiff argued that the Fund should return the money he paid into the pension fund after surpassing the maximum number of service credits to receive full monthly benefit benefits and that the Fund miscalculated his pension benefits. The court declined to consider these arguments because he did not raise them in his pre-litigation administrative appeal. Because he did not raise these arguments, he is barred from raising them now. See Chapman v. ChoiceCare Long Island Term Disability Plan, 288 F.3d 506, 511 (2d Cir. 2002) (requiring exhaustion of administrative remedies). The court affirmed the judgment of the district court.