CARP and Furlough

Dear Brothers and Sisters,

Involuntary furlough under CARP is considered a distributable event, just like a separation/termination status.

Participants who were actively accruing credited service in CARP and were involuntarily furloughed, will return to CARP and continue to accrue credited service upon recall. This is regardless of whether or not they have commenced their benefit while on involuntary furlough. If someone is recalled after commencing their benefit while on involuntary furlough, a rehire offset calculation will be done at their subsequent retirement date to offset the original benefit payment. A rehire offset calculation in the simplest terms is taking the original benefit that was paid out and offsetting it from any future accruals when someone returns to work. 

For illustrative purposes, if someone is involuntarily furloughed and takes their lump sum benefit of $50k, later returns to work and works until normal retirement, a final full calculation will be done taking into account all service (pre- and post-furlough), and then the original payout of $50k will be offset from the final payout amount. So, if this person ended up accruing a $200k benefit with all service taken into account, the lump sum payout at normal retirement would be $150k

A leave status typically falls into an “active” status category in which vesting service continues to accrue in CARP, so distribution is not permissible. Layoff isn’t technically a status in the Company’s system, but to the extent it’s considered an inactive/termination status, it would be treated the same as an involuntary furlough in the sense that the employee would be able to take a distribution if they’re eligible.

You can call the Benefits Service Center at 1-800-651-1007 and ask for a pension estimate or to start your benefit.

Have a safe and peaceful holiday season.

Fraternally, 

Ken Meidinger
International Representative
Airline Division
UAL Benefits Coordinator