Pension & Benefits

Pension & Benefits

What will happen to the U.S. qualified pension plans as a result of Dow’s separation from DowDuPont?

Both the Dow Employees’ Pension Plan (DEPP) and the Union Carbide Employees’ Pension Plan (UCEPP) will be retained by Dow.

  • For retirees, this means that your benefits will continue to be paid from the same sources as before.
  • For active heritage Dow employees continuing with Dow, the transaction does not affect your pension benefits.
  • For active employees transferring to Corteva or DuPont, this means that your vested accrued benefits as of Dow’s separation from DowDuPont will remain with the Dow plan where they currently reside today – and you can commence your retirement benefit based on the current plan rules.

IRS and Department of Labor rules strictly protect a participant's rights to his or her vested accrued benefit. An "accrued pension benefit" is the benefit that an employee has earned as of a particular day.

Accrued benefits for U.S. tax-qualified pension plans are held in trusts that are separate legal entities from both Dow and DuPont. Qualified U.S. pension benefits are protected under federal law, and the plans must meet their obligation to existing pensioners and other plan participants with the assets held in the trust. The protection under federal law prohibits plans from using pension assets for any purpose other than paying benefits and qualified plan expenses.

What will happen to my U.S. retiree medical benefits?

As with pension, Dow will continue to be responsible for retiree medical, including RHCAP, for all heritage Dow employees and retirees. For current retirees and continuing Dow employees, this means that there will be no change to the benefits you are currently eligible for due to the transaction. For active heritage Dow employees transferring to Corteva and DuPont, you will receive benefits under Dow’s retiree medical programs, including RHCAP, for which you are eligible, based on your age and service at the date Dow separates from DowDuPont. Further, transferring employees within 6 months of achieving retiree medical eligibility will be granted eligibility in the plans for which they are eligible.

How well funded are my U.S. qualified pension benefits?

Outside of the protections afforded by law described above, Dow remains committed to meeting its obligations to our current and future pensioners. In fact, Dow has so far contributed nearly $1.3 billion to its U.S. qualified plans in 2018, which has increased the overall funded level of these plans. Globally, Dow has contributed approximately $1.5 billion to its pension plans in 2018 through the end of Q3.

Information related to the funded status of the U.S. plans can be found in the Annual Funding Notices located on Dow’s intranet or the DowFriends website.

You announced a $1.1 billion contribution, but note that you have contributed $1.5 billion globally year to date. When did you contribute the $400MM difference?

The plans were funded throughout the year and contributions are reflected in our quarterly financial statements as they are made.

With the contributions, what is the current funded status of Dow’s pension plans?

Globally, this contribution improved Dow’s funded global status on a GAAP basis from approximately 76.7% funded to 80.4% funded.

An 80% funding level is lower than your peers/other Fortune 100 companies. What is the timeframe to increase the funding status?

Dow has both funded and unfunded defined benefit pension plans that cover employees in the United States and a number of other countries. Accordingly, we do not target a specific global funding percentage, but follow an overriding funding policy to contribute to defined benefit pension plans when pension laws and/or economics either require or encourage funding.