MMC Benefits Handbook
You are eligible for the transition benefit, if according to Marsh & McLennan Companies' records, you satisfied all of the following criteria on December 31, 2005 had at least 10 years of Vesting Service, and you were:
- an Active Employee with an Accrued Benefit
- credited with at least 120 months (10 years) of vesting service, and
- at least age 50.
If you are eligible for the transition benefit, you will receive a benefit in addition to the benefits you have accrued both before and after January 1, 2006. The additional benefit credited is in direct proportion to any increase in your Final Average Salary from December 31, 2005 to the earlier of your first date of termination or December 31, 2016. The additional benefit will be equal to the difference between your Accrued Benefit as of December 31, 2005 and the amount calculated by multiplying your Accrued Benefit as of December 31, 2005 by a factor that is equal to your Final Average Salary as of the earlier of your first termination date or December 31, 2016, divided by your Final Average Salary determined as of December 31, 2005 (the factor will never be less than 1.0).
For example, if your Final Average Salary has increased by 6% on or after January 1, 2006 until the earlier of the first date you terminate employment with any Marsh & McLennan Companies company or December 31, 2016, your additional benefit is equal to 6% of your Accrued Benefit prior to January 1, 2006.
If you qualified for the transition benefit and then transfer from one participating company to another, your Eligible Monthly Pay while employed by all participating companies up to and including December 31, 2016 will be considered under the transition benefit provided you were continuously employed by a company in the Marsh & McLennan Companies World-wide Controlled Group and you continued to satisfy the transition benefit requirements.
Example – Han, a participant eligible for the transition benefit
Han was born on March 15, 1944, was hired by the Company on January 1, 1969 and terminated employment with the Company on March 31, 2009.
- Han has 483 months (40 years and 3 months) of both Benefit Service and Vesting Service as of March 31, 2009. Therefore, he is vested in his accrued retirement benefit.
- Han's Eligible Monthly Salary during the period from 1/1/2001 through 12/31/2005 is as follows:
Han's annual Covered Compensation for 2005 is $57,636. Han's Final Average Salary prior to January 1, 2006 is the average over the previous consecutive 60 months (5 years): $272,250 / 5 = $54,450. Han has 444 months (37 years) of Benefit Service prior to January 1, 2006.
- Han was employed, had an Accrued Benefit in the Plan, was age 61 and 9 months and had 444 months (37 years) of Vesting Service on December 31, 2005, making him eligible for the transition benefit. This means that in addition to Han's Accrued Benefit credited as of December 31, 2005, Han will receive a transition benefit based on increases in his Eligible Monthly Pay after December 31, 2005. For purposes of the transition benefit, Han's Final Average Salary increased from $54,450 to $61,400 (or by 12.764%) from January 1, 2006 to March 15, 2009.
- Note: Han's Final Average Salary of $61,400 as of March 15, 2009 is calculated as follows:
Transition Benefit and Termination of Employment Followed by Rehire
If you are eligible for the transition benefit, terminate employment and are later rehired, you will not be eligible for the transition benefit based on any change to your Eligible Monthly Pay that may occur on or after your rehire date.
Transition Benefit and Transfer to a Non-participating Employer in the Company's World-wide Controlled Group Followed by Transfer to Participating Employer
If you are eligible for the transition benefit, transfer to a non-participating employer in the Company's World-wide Controlled Group, and are later transferred to a participating company, you will not be eligible for the transition benefit with respect to earnings with the non-participating employer. Only your Eligible Monthly Pay while employed by participating companies prior to January 1, 2017 will be considered under the transition benefit, provided you remained continuously employed.