Sample Constituent Services Manual - Congressional Management ...

Bankruptcy - continued
approved. If this occurs, your first contact should be with your state’s
Department of Insurance.
Pensions
In the event the employer is delinquent in paying policy premiums or has a
self-insured policy which is bereft of funds, employees will have to file creditor
claims with the bankruptcy court to secure coverage or premium refunds.
Pension plans are not considered company assets that can be liquidated.
Consequently, employees can be assured their pension funds are safe. However,
when a company shuts down, the pension plan is closed and contributions are
stopped.
The closing of the plan and distribution of benefits to employees are handled by
a financial institution under the supervision of the Internal Revenue Service
(IRS) and U.S. Department of Labor. This is also a time-consuming process;
it may take several months for employees to start receiving their benefits.
Questions concerning this subject should be directed to Department of Labor’s
Employee Benefits Security Administration.
Federal Tax Withholding
If a company files Chapter 11 bankruptcy and closes quickly, many employees
may not receive W-2 forms for that year. Employees may obtain substitute W-2
forms from the IRS.
Information to Get
1. Constituent’s name, address, phone number and social security number.
2. Signed authorization form.
3. Name of company filing for bankruptcy.
4. Chapter of bankruptcy being filed, date it was filed, location of court where
the petition was filed, name and location of the trustee, and case number.
5. A case sheet outlining the constituent’s problem in detail.
6. When applicable, the name of the financial institution handling the pension
plan closure.
Contacts
The court and trustee contacts will vary with each individual case. Inquiries to
the Department of Labor regarding back wages should be directed to the Wage
and Hour office located nearest to you. You can obtain contact information for
the appropriate office from Department of Labor headquarters or the agency
website.
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