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Benefits

Severance and Texas unemployment benefits: Can I take both?

Dallas and Fort Worth employees often question the relationship between severance pay and unemployment benefits through the Texas Workforce Commission. Workers often think if they accept severance pay they are automatically ineligible for unemployment benefits in Texas. That is incorrect. The terms of the severance agreement determine whether you can receive severance and unemployment pay in Texas. When in doubt, talk to Dallas or Fort Worth employment lawyer Adam Kielich about your situation. Basic rules for Texas Workforce Commission unemployment benefits and severance pay Unemployment benefits from the Texas Workforce Commission are available to Dallas and Fort Worth employees who lost their job...

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Just been fired? Apply for unemployment benefits in Texas

If you are fired (aka discharged, terminated) from your job then one of your first acts in almost all cases should be to apply for unemployment benefits. Applying for unemployment benefits through the Texas Workforce Commission is free so even if denied benefits you have only lost the time applying. This is true even if your employer believes it had a legitimate reason to fire you. The TWC has specific standards for awarding unemployment benefits. The employer's reason for terminating your employment may not meet those standards. Sometimes employers do not defend against an unemployment benefit application. You can receive benefits...

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College Retirement Plans under Fire for Excessive Investment Fees

The past ten to fifteen years has given rise to a set of lawsuits against 401k plan administrators over excessive plan fees and revenue sharing agreements between plan administrators and recordkeepers. We are probably approaching the end of this wave of excessive fee litigation against for-profit employers for 401k plans. A new wave of excessive retirement plan fee litigation arises against non-profit plan administrators. Recently nine class actions lawsuits were filed against several major universities for investment fees charged to retirement plan participants in the employees' 401k and 403b plans. The gist of the litigation is the same as the lawsuits filed...

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Why retirement funds are important in a Tarrant County divorce

Our society undervalues the importance of retirement savings in favor of immediate gratification. It also as a whole lacks a meaningful understanding of the investments and plan rules surrounding retirement vehicles like 401k plans and defined benefit pensions. Undervaluing of retirement funds is also true in divorces where the spouses are often focused on the immediate effects of the divorce. This can be a serious misstep in a divorce in Texas where those retirement funds are often fully or partially community property subject to division in the divorce. Increasingly retirement funds make up a large portion of the community property in...

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Why is there a 10% early withdrawal penalty to cash out a 401k?

Before becoming an employment attorney I worked for one of the largest (maybe the largest) provider of 401k services. We provided various investment, customer service and recordkeeping services for 401k plans. Most people who call for information about their 401k plans will end up talking to my former employer or one of their competitors. Most 401k plan administration responsibilities outsourced to financial institutions that provide the infrastructure and staffing with expertise in plan issues. A large number of calls about 401k plans are for withdrawals from the 401k plan. Many people were dismayed to find out that a 10% early withdrawal penalty may...

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Vanguard funds targeted in new 401k excessive fee litigation

401k excessive fee litigation has been an active area of ERISA litigation for over a decade with 401k participants arguing the plan administrator--along with various other plan fiduciaries--breached the duty to prudently manage the investment options of the plan. Most of these cases argue the plan administrator failed to select investments with reasonable fees, particularly in light of the buying power of the 401k plan to obtain lower fee share classes or to obtain access to lower fee funds in the market. Although this issue has been litigated for over a decade we still do not have a clear rule...

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Does my employer have to collect interest on a pension overpayment? Answered by a pension attorney

You receive an envelope from your pension plan.  As usual you think it's either this month's check or some notice you'll scan and toss in the trash. You open it and it isn't a check from your Dallas-Fort Worth employer. It is a notice.  But not the kind of boilerplate legal notice that you normally forget after it hits the trash bin. This notice is a letter from the plan administrator telling you that you've been overpaid on your pension benefit. Not only are they cutting your monthly payment to recover the pension overpayment. They will charge interest against the overpayment. As...

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Fort Worth QDRO Attorney on the 10% Early Withdrawal Penalty

QDROs are a powerful tool in the property division in a Dallas or Fort Worth divorce. They allow a party to receive part of an employee's retirement plan benefits (such as a 401k or defined benefit pension). Under the federal law that governs private retirement plans (ERISA) an employer generally may not take away or give part of an employee's accrued benefit to another person. (This is known as ERISA's anti-cutback rule.) The exception is for a qualified domestic relations order (QDRO) that awards a portion of the employee's benefit to a spouse, former spouse, child or other dependent of the plan...

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Employers struggling to win pension overpayment cases in Dallas and Fort Worth

The late 2000s and early 2010s saw a growth in litigation over 401k fees by employee-side ERISA attorneys. These often attacked large employers and major plan recordkeepers who profit from the kickback scheme known as revenue sharing. We're still not done with that wave of litigation but we're seeing a similar rise in litigation for pension overpayments. In these lawsuits employers pursue retirees for allegedly overpaid pension benefits based. The overpayments often arise due to shoddy recordkeeping, payment systems and benefit calculations. (Once again richly paid recordkeepers like Fidelity Investments and AONHewitt find themselves caught up in the plan administrator's problems.) Plan...

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Can I take my QDRO money early after my Fort Worth divorce?

Often divorces divide retirement plans like a 401k or defined benefit pension. A judge signs a QDRO (qualified domestic relations order) ordering the retirement plan administrator to divide the benefit. The ability to take funds from the plan under the QDRO depends upon the terms of the QDRO and plan rules. Some plans allow the alternate payee to take the money as soon as administratively possible. Other plans limit distributions to some time in the future. The QDRO may order that the funds unavailable until certain conditions occur. That is true even if the plan rules would otherwise allow the alternate payee to...

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