Rightfully Yours. Gary A. Shulman

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      Once a QDRO is prepared, it should be sent to the plan administrator for review and approval. In most cases, the plan administrator is the company itself. Your best bet is to send the QDRO to the attention of the human resources or legal department at the company where your ex-husband works (or worked). Not surprisingly, many plan administrators adopt a paternalistic attitude toward their employees, which may engender a combative attitude on the part of attorneys representing nonparticipant spouses. In seminars conducted for plan administrators, I have heard countless statements like “That might hurt our employee, if we give her that much of his pension” or “That doesn’t seem fair to our worker.”

      Suggestions that plan administrators should avoid taking sides in domestic relations cases are frequently met with quizzical looks. This attitude can cause significant problems during the discovery process or when preparing a QDRO to secure the property rights of the alternate payee. The legal term discovery means the process of obtaining information from the plan administrator regarding your ex-husband’s pension benefits. In other words, your attorney tries to discover all the pertinent information that will help him or her place a value on your ex-husband’s pension or savings plan benefits.

      1. Plan Administrators and You

      Too many pension plan administrators view the nonparticipant spouse as an individual appropriating something that was earned through someone else’s efforts. The economic partnership aspects of a marriage — the fact that a pension is deferred wages earned through the efforts of both parties and the contributions of the nonemployee to the overall marital estate — can be obscured by the misguided loyalty of plan administrators toward their employees. Many plan administrators do not realize that the nonparticipant spouse is actually considered a co-owner of the pension by domestic relations courts throughout the country. However, as unresponsive as some plan administrators are toward attorneys, they may be even less responsive to a former spouse trying to obtain information directly.

      These attitudes may change once the QDRO is approved, because the nonparticipant spouse should be considered by the plan administrator to have the same status as a plan beneficiary and to be entitled to all of the required notices and other information sent to plan participants. Also, an alternate payee should then be permitted to receive information from the plan regarding the amount of the assigned benefits and how much the alternate payee would receive, depending on various potential commencement dates.

      2. Remaining Nonadversarial with the Plan Administrator

      When Congress created the QDRO laws in 1984, it granted plan administrators sole discretionary authority in approving your QDRO. Plan administrators come in all shapes and sizes. Some are rather sophisticated and have in-house ERISA (pension) attorneys and QDRO processing departments; others have never heard of ERISA or a QDRO. Many smaller companies are not aware of the QDRO provisions of the law and may use an independent third-party administrator to handle their employee benefits matters.

      Whether you are dealing with a Fortune 500 corporation like General Motors or a company like Lenny’s Collision Center, both you and your attorney should treat the plan administrator in a kid-glove, nonadversarial manner. While this is next to impossible for many divorce attorneys, it is essential that you not antagonize the plan administrator when you submit a QDRO for review. It’s a lose-lose situation if you do. As the outsourcing QDRO review agent for many Fortune 500 companies, I have received countless correspondences from attorneys that are submitting QDROs for review. Sometimes the cover letter to the QDRO will go something like this: “If you do not review this QDRO and make payment to my client within ten days of receipt, you will be held personally liable and I will make you a party to the case and start litigation immediately.” This is not a good first impression to make on the plan administrator.

      Even though your QDRO may be deficient from a strict legal perspective, a plan administrator may decide to go ahead and approve your QDRO by applying a liberal interpretation of it. The administrator may decide to make an assumption regarding a silent provision just to help the parties finalize the QDRO quickly. If you catch the plan administrator in a good mood, it may forgive some technical and nonsubstantive QDRO deficiencies that could otherwise result in a rejected order. For example, assume the QDRO awarded you $20,000 from your ex-husband’s 401(k) plan but does not include language about where the $20,000 is to come from among your ex-husband’s six investment accounts. If the company wanted to, it could reject your QDRO because the QDRO was silent on the issue of the allocation of your share of the benefits. It may say, “Sorry, your QDRO is rejected because it didn’t tell us whether we should take the whole $20,000 from one of his accounts under the plan or on a pro rata basis from among all of his accounts.” As ridiculous as this sounds, many companies reject QDROs everyday for this very reason.

      If this is the only apparent problem with the QDRO, the plan administrator may assume that it was your intent to make a pro rata allocation, and approve the QDRO accordingly. However, if you or your attorney antagonize the plan administrator in some fashion, it would be well within its rights to reject your QDRO and require you to submit an amended order clarifying the method of allocation of benefits. This is just one of many examples of the importance of aligning yourself with the plan administrator rather than making an enemy of it. Not only could it apply stricter requirements when reviewing your QDRO, but it could also delay the review process for months or, in some cases, years.

      Plan administrators who act in a clearly partisan fashion sometimes seem almost shocked and amused by the aggressive behavior of divorce attorneys. Sometimes administrators are downright hostile, and rude to boot. If they have suffered through incendiary phone calls from your attorney, requests to complete 40-page interrogatories, incessant letters demanding immediate responses, subpoenas, and hours spent in a witness waiting room, this may have fueled some of their hostility. Some plan administrators have received orders (purporting to be QDROs) that simply demanded a check for the alternate payee. Other plan administrators believe it is not their responsibility to school attorneys on drafting QDROs. Whatever the reason, you and your attorney need to exercise caution when dealing with plan administrators.

      In some ways, plan administrators are similar to expert witnesses in court. They often answer you or your attorney’s questions precisely, without providing СКАЧАТЬ