Vesting in employee benefits

UPDATED: Sep 30, 2022

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Vesting in employee benefits

I worked for a large public accounting firm from the period of March 2012 to October 2014 in IL. I then moved with the firm to Australia worked for the period of October 2014 to April 2017. As part of my fixed term appointment in Australia, I was forced to resign from the US firm and start at the Australia firm, there was no gap in my employment with the overall public accounting firm (i.e. I stopped working on the 30th of September and started on Oct 1st). With that said, the US firm did not view me as an employee of the firm and my vesting into the employee pension fund did not continue while I was located in Australia. However, I worked for the same overall company and answered to the same overall global organization the entire time I understand that they are different legal entities, including the need from the US firm to approve certain expenses while traveling home. Had I received credit for working at the overall firm, I would be vested in the pension plan by now. Is there a case to be made for credit of time served in Australia to count towards pension vesting?

Asked on April 14, 2017 under Employment Labor Law, Florida


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 5 years ago | Contributor

Pension plans are not mandated by law--companies do not have to have them. That being the case, they can determine who is eligible for them and how employees vest, including whether service for the same "overall" company counts, or whether each unit's pension is qualified for and administrated separately. You need to look to what the pension plan itself says; if the way it is set up, the U.S. and Australian units are considered separately and service in one does not count towards pension vesting in the other, etc., that is legal. It is entirely up to how this company has chosen to set up its pension plan(s) and the rules it has adopted for vesting thereunder; again, there is no  law mandating that time in one unit count for vesting in another.

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