Progress Energy Choice Time Plan

Transcription

1 Document title: AUTHORIZED COPY Progress Energy Choice Time Plan Document number: HRI-SUBS Applies to: Keywords: Eligible employees of Progress Energy, Inc.; Progress Energy Carolinas, Inc.; Progress Energy Florida, Inc. (non-bargaining unit employees); and Progress Energy Service Company, LLC human resources information; benefits booklets Summary Plan Description Progress Energy, Inc. Employer Identification No Plan No. 526 Effective January 1, 2011 (unless otherwise noted) This document is a Summary Plan Description (SPD) for the Progress Energy Choice Time Plan, a component plan under the Progress Energy, Inc. Welfare Benefit Plan (the "Plan"), sponsored by Progress Energy, Inc. (Progress Energy). An SPD is a summary of the official plan documents that govern the terms, conditions and administrative operations of a benefit plan that is subject to the Employee Retirement Income Security Act of 1974 (ERISA). It does not describe every plan provision in full detail, and it does not alter any plan or any legal instrument related to the plan s creation, operations, funding or benefit payment obligations. Every effort has been made to ensure that this document reflects relevant plan provisions in effect as of January 1, However, if there are any inconsistencies between this document and the official plan documents, the terms and conditions of the official plan documents will govern. In no case does this document imply or guarantee any right of future employment. Non-bargaining regular, full-time employees of Progress Energy, as well as Progress Energy Carolinas, Inc., Progress Energy Florida, Inc., and Progress Energy Service Company, LLC (participating subsidiaries of Progress Energy), are eligible to participate in this plan. Progress Energy reserves the right to amend or terminate the plan or any plan benefit at any time based on the cost of the benefits or other considerations without prior approval of or notification to any party. HRI-SUBS Rev. 9 Page 1 of 15

2 Table of Contents Eligibility Pg 3 Newly Eligible Employees 3 Leaves of Absence 3 Enrollment and Changes Pg 4 Enrollment for Newly Eligible 4 Employees Changing Your Elections 4 Annual Benefits Enrollment 4 How Choice Time Works Pgs 5-6 Choice Time Options 5 Plan Carefully 5 Scheduling Choice Time 5 Reporting Choice Time 5 Effect on Other Benefits and Overtime 5 Cost 6 Claims and Appeals Pgs 7-9 Benefit Claims and Appeals Procedures 7 When Participation Ends Pg 10 Other Important Information Pgs Plan Administration 11 Your Rights Under ERISA 13 Contact Information Pg 15 Employee Service Center 15 HRI-SUBS Rev. 9 Page 2 of 15

3 Eligibility Eligibility The Progress Energy Choice Time Plan covers employees who meet the eligibility requirements specified herein and who are employed by a participating subsidiary. A subsidiary is a participating subsidiary if it is within Progress Energy's controlled group and if it, with the approval of Progress Energy, has elected by action of its Board of Directors to participate in this plan. The term "controlled group" means the group of companies as defined in Section 1563(a) of the Internal Revenue Code (the "Code"). A participating subsidiary may only participate in the plan for so long as it is a member of Progress Energy's controlled group. A participating subsidiary may elect to withdraw from participation in the plan at any time. Newly Eligible Employees Non-bargaining regular, full-time employees of participating subsidiaries are eligible to enroll in Choice Time on the first day of employment or reclassification to non-bargaining regular, full-time employment status. Leaves of Absence If you are granted one of the following leaves and all of your regular vacation time has been used or paid out, the dollar amount of the Choice Time deductions taken prior to the leave that exceed the amount of Choice Time you have taken may be paid upon your request at the beginning of the leave for: Newborn care Adoption/foster care Long-term disability Military service However, instead of being paid for Choice Time at the beginning of your leave, you may take your Choice Time after returning to work if you return during the same calendar year. In this case, your payroll deductions will be recalculated and will resume upon your return to work. If the dollar amount of Choice Time you have been paid prior to your leave exceeds the dollar amount of your Choice Time payroll deductions and you will not be returning to work prior to the end of the calendar year, you must repay the company for the excess Choice Time payments you have received. HRI-SUBS Rev. 9 Page 3 of 15

4 Enrollment and Changes Enrollment and Changes Enrollment for Newly Eligible Employees As a non-bargaining regular, full-time employee of a participating subsidiary, you must enroll through Employee Self Service or submit an enrollment form within 30 days of your hire or reclassification date to non-bargaining regular, full-time status if you wish to purchase Choice Time for the year in which you are hired or reclassified. The Choice Time option you elect will remain in effect until December 31 of the year in which you make the election. Changing Your Elections After the 30-day newly eligible enrollment period has expired, you may not change your Choice Time election until the next annual benefits enrollment period. Annual Benefits Enrollment You are eligible to purchase Choice Time each year during annual benefits enrollment. Elections made during the annual benefits enrollment period are effective January 1 through December 31 of the following year. Elections do not carry over from one year to the next. Participation is voluntary. HRI-SUBS Rev. 9 Page 4 of 15

5 How Choice Time Works AUTHORIZED COPY How Choice Time Works Choice Time allows you to buy time off in addition to your vacation. Instead of having money taken from one paycheck in a lump sum when you take additional time off, you pay for your Choice Time with before-tax payroll deductions throughout the year. Choice Time Options You may elect to buy up to 40 hours of Choice Time. Your options are: 0 hours 8 hours 16 hours 24 hours 32 hours 40 hours Plan Carefully You should plan your Choice Time elections carefully. The following IRS guidelines apply: You may use your Choice Time only after all of your vacation has been taken. You may not change your Choice Time election during the year. You must use Choice Time between January 1 and December 31 or you will lose it. Choice Time elected for any year may not be carried over or paid out in the following year. If you are unable to use your Choice Time and have regular vacation time remaining at the end of the year, you may carry over vacation according to the terms of the vacation policy in the Employee Handbook. Scheduling Choice Time Choice Time should be planned and taken with your supervisor s approval and in accordance with your participating subsidiary s vacation practice guidelines. It should be included with vacation hours when scheduling time off for the year. If you are not able to take your Choice Time before the end of the calendar year due to work restrictions, your supervisor should contact Payroll to request taxable payment in your last paycheck of the calendar year for the Choice Time that you are unable to use. This request should be limited to extenuating work-related circumstances only, and should be made on the form provided to department heads each year around the last week of November. Reporting Choice Time For the purpose of time reporting, Choice Time hours must be coded on your time sheet as "Choice Time." Pay for these hours will be indicated as Choice Time on your pay stub and on Payroll Accounting reports. As explained in the plan guidelines above, Choice Time must be reported only after you have taken all available vacation. Effect on Other Benefits and Overtime Hours used for Choice Time will be considered as time worked for overtime purposes. The dollars you pay for Choice Time reduce your eligible base salary earnings for the purpose of the Employee Cash Incentive Plan (ECIP), the Management Incentive Compensation Program (MICP), the Progress Energy Pension Plan, and the Progress Energy 401(k) Savings and Stock Ownership Plan. Contributions to the 401(k) Plan will not be deducted from Choice Time hours that are paid. The reduction in earnings will affect pay and applicable transition credits received under the Progress Energy Pension Plan, as well as the dollar amount of an award received under ECIP or any other cash incentive plan. Also, the total amount of your annual taxable earnings will be reduced by the cost of any Choice Time hours that are purchased. HRI-SUBS Rev. 9 Page 5 of 15

6 How Choice Time Works Your before-tax contributions for Choice Time do not affect the amount of pay-related benefits for life insurance or long-term disability. However, your Social Security benefits may be reduced because you do not pay Social Security taxes on before-tax contributions for Choice Time. This means that if your taxable income is less than the maximum Social Security wage base, your future Social Security benefits which are based on the Social Security taxes you pay could be slightly reduced. In most cases, this benefit reduction should be very small. Cost You pay the full cost of Choice Time. The cost of Choice Time is based on your annual base salary, converted to an hourly rate, as of your hire date or January 1, if you enroll during annual enrollment. If you are reclassified to nonbargaining regular, full-time status during the year, the cost of Choice Time is calculated based on your annual base salary at the time of reclassification. Payroll deductions do not change during the year, even if your salary changes. However, the payment of Choice Time hours will be based on your salary in effect at the time the Choice Time hours are taken. HRI-SUBS Rev. 9 Page 6 of 15

7 Claims and Appeals Benefit Claims and Appeals Procedures The following are two different types of claims that may be made under the Progress Energy Choice Time Plan: Claims for plan benefits. Claims as to whether an individual is eligible to participate in, or whether an eligible individual is enrolled for participation in, the plan (referred to as an eligibility or enrollment claim ). Claims for Plan Benefits The Plan Administrator has the authority to decide initial claims for plan benefits, as the initial claim administrator, and denied claims for plan benefits on review, as the denied claim reviewer. In connection with deciding initial claims and reviewing denied claims, the Plan Administrator has the authority to interpret the plan, decide claims-related questions and make factual determinations, each in its sole discretion. Such interpretations, decisions and factual determinations shall be controlling. Progress Energy has no discretionary authority with respect to claims for plan benefits. To file a valid claim for plan benefits, you (or your authorized representative) must follow the claim submission procedures for the plan as described in this section of this SPD and any updating materials. You also can obtain additional information regarding claims and appeals by calling the Employee Service Center. Initial Claim Claims must be submitted in writing and received by the Plan Administrator within 90 days after the end of the plan year for which you are claiming a plan benefit. If you delay submitting your claim, you could lose benefits. Once your claim has been documented and you have filled out all the necessary forms, your claim generally is processed within 90 days after it is received by the Plan Administrator. However, if more time is needed to make a determination due to matters beyond the Plan Administrator s control, it will notify you or your representative within 90 days after receiving your claim. The extension notice will include the date a determination can be expected, which will be no more than 180 days after receipt of your claim. If more time is needed because necessary information is missing from your claim, the notice will also specify what information is needed. The determination period will be suspended on the date the Plan Administrator sends such a notice of missing information, and the determination period will resume on the date you or your representative responds to the notice. You will have 45 days to respond to the request for information. Denial of Initial Claim If any part of your claim is denied, you will be notified in writing. This notice will contain: The specific reason or reasons for the denial. Reference to the specific plan provisions on which the denial is based. A description of any additional material or information necessary to perfect the claim and an explanation of why such material or information is necessary. A description of the plan s internal review procedures, the time limits applicable to such procedures and how to initiate an appeal, including a statement of your rights to bring a civil action under section 502(a) of ERISA following any final internal adverse benefit determination on appeal. HRI-SUBS Rev. 9 Page 7 of 15

8 Claims and Appeals Appeals If any part of your claim is denied, you or your authorized representative may appeal the decision made on your claim. You have 60 days from the time you re notified of the denial of your claim to appeal. Your appeal must be in writing. You should describe the decision you are appealing and state the reasons why you think the decision made on your claim was incorrect. You or your authorized representative will be provided, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information related to your claim, and will be able to submit written comments, documents and other information relevant to your appeal. Appeals should be directed to the Plan Administrator. If you do not file an appeal within the time permitted, your claim will be deemed abandoned and you may not reassert it under these procedures or in a court or any other venue. If you fail to raise issues or present evidence on appeal, you may not be able to raise those issues or present that evidence in any later proceeding or judicial review of your claim. Your claim will be given a full and fair review. Someone other than an individual involved in the initial claim, or a subordinate of such individual, will make the determination on appeal. The decision on review will not give deference to the initial adverse claim determination. A decision on your appeal will ordinarily be made within 60 days. However, if more time is needed to make a determination due to matters beyond the Plan Administrator s control, it will notify you or your representative within 60 days after receiving your appeal. The extension notice will include the date a determination can be expected, which will be no more than 120 days after receipt of your appeal. Denial of Appeals You will be notified regarding the decision on your appeal in writing. If your appeal is denied, the denial notice will contain: The specific reasons for the denial of your appeal. Reference to the specific plan provisions on which the denial of your appeal is based. A statement regarding your right, upon request and free of charge, to access and receive copies of documents, records and other information relevant to the claim. A statement regarding your right to sue under Section 502(a) of ERISA following any final internal adverse benefit determination and about any available voluntary alternative dispute resolution options. Eligibility and Enrollment Claims The Plan Administrator has the authority to decide initial eligibility or enrollment claims, as the initial claim administrator, and denied eligibility or enrollment claims on review, as the denied claim reviewer. In connection with deciding initial claims and reviewing denied claims, the Plan Administrator has the authority to interpret the applicable plan, decide claims-related questions and make factual determinations, each in its sole discretion. Such interpretations, decisions and factual determinations shall be controlling. Progress Energy has no discretionary authority with respect to eligibility or enrollment claims. To file a valid eligibility or enrollment claim, you (or your authorized representative) must follow the claim submission procedures as described in this SPD and any updating materials. Such a claim must be received by the Plan Administrator within 90 days after the end of the plan year in which you are claiming eligibility/enrollment should have occurred. HRI-SUBS Rev. 9 Page 8 of 15

9 Claims and Appeals Notification of Initial Determination Eligibility and enrollment claim determinations will be made within 30 days of receipt by the Plan Administrator of all information necessary for determination of your claim. If extra time is needed to process your claim, you will be notified that up to an additional 15 days is required. If the extension is necessary due to your failure to submit enough information, the notice will also specify what information is needed. The determination period will be suspended on the date the Plan Administrator sends such a notice of missing information, and the determination period will resume on the date you or your representative responds to the notice. You will have 45 days to respond to the request for information. Appeal of Determination If you receive an adverse claim determination, you have 60 days from the time you are notified of the denial of your claim to appeal the decision in accordance with the Appeals section above. Your appeal must be in writing and must be submitted to the Plan Administrator. A decision on your appeal will ordinarily be made within 60 days (or within 120 days if special circumstances require an extension). Timeline and Notification Requirements Time Limits Claims for Plan Benefits Eligibility and Enrollment Claims To make initial claim determination Extension (if proper notice is given and delay is beyond the plan s control) To request missing information from claimant For claimant to provide missing information For claimant to request appeal To make determination on appeal 90 days 30 days 90 days 15 days 90 days 30 days 45 days 45 days 60 days 60 days 60 days (plus up to an additional 60 days) 60 days (plus up to an additional 60 days) Legal Action You have the right to bring a civil action under Section 502(a) of ERISA against the plan if you are not satisfied with the outcome of the internal claims and appeal procedure. Unless you have exhausted your internal administrative review rights under the plan, you generally are prohibited from bringing a civil action against the plan, the Plan Administrator or Progress Energy. No civil action may be brought more than one year after the date on which your claim is denied on final internal appeal. HRI-SUBS Rev. 9 Page 9 of 15

10 When Participation Ends When Participation Ends Your participation in Choice Time will end if: You terminate employment with a participating subsidiary. Your employment status changes from a non-bargaining employee of a participating subsidiary to a Progress Energy Florida, Inc. bargaining unit employee. (Progress Energy Florida, Inc. bargaining unit employees are eligible for benefits under the FlexPower program which does not include the Choice Time benefit.) Your death. If the dollar amount of Choice Time deductions taken prior to your termination date exceeds the dollar amount of Choice Time you have taken, the difference will be paid in your last paycheck. Likewise, if the dollar amount of Choice Time you have taken prior to your termination date exceeds the dollar amount of the Choice Time deductions taken, the difference will be deducted from your last paycheck. If you terminate employment and return to work with a participating subsidiary, you may enroll for Choice Time within your first 30 days of employment. If your rehire date is within 30 days of a voluntary termination, your elections may be reviewed against IRS guidelines to ensure compliance. HRI-SUBS Rev. 9 Page 10 of 15

11 Other Important Information Plan Administration Plan Administration Plan Identification The Progress Energy Choice Time Plan is a component plan under the Progress Energy, Inc. Welfare Benefit Plan (the Plan ). The three-digit plan number is 526. The employer identification number (EIN) issued by the Internal Revenue Service for Progress Energy, Inc., the Plan s sponsor, is The Plan Sponsor s address is: Progress Energy, Inc. PO Box 1551, PEB 16ESC Raleigh, NC Costs and Funding Benefits under the Progress Energy Choice Time Plan are funded through pre-tax contributions from participating employees. Administration The plan is a fringe benefit plan. The plan year ends on December 31 of each year and the plan operates and maintains records on a calendar year basis. Plan Administrator The Plan Administrator has overall responsibility for the operation of the plan and controls the administration of the plan. The Plan Administrator has the exclusive authority in its sole discretion to interpret the provisions of the plan and to decide any and all matters arising thereunder, including but not limited to factual determinations, matters related to eligibility for benefits and application of plan limitations. Although the Plan Administrator has the right to interpret the provisions of the plan and to decide all matters arising thereunder, the Plan Administrator does not have the authority to deviate from the provisions of the plan or to approve any exceptions to the plan. The Plan Administrator has a fiduciary obligation under applicable law to apply the provisions of the plan as written. If it should become necessary to contact the Plan Administrator, call or write referring to the plan identification number. The Plan Administrator is: Progress Energy Service Company, LLC PO Box 1551, PEB 16ESC Raleigh, NC The Employee Service Center provides administrative services for plan participants and can be reached at the address above, by calling or by at employee.service@pgnmail.com. HRI-SUBS Rev. 9 Page 11 of 15

12 Other Important Information Plan Administration Benefits Administrator The Benefits Administrator is: Progress Energy Service Company, LLC PO Box 1551, PEB 16ESC Raleigh, NC Participating Subsidiaries Eligible employees of the following participating subsidiaries of Progress Energy, Inc. are covered by this plan, subject to all eligibility requirements stated herein. Progress Energy Carolinas, Inc. Progress Energy Florida, Inc. (non-bargaining employees) Progress Energy Service Company, LLC Agent for Service of Legal Process Legal process may be served upon the Plan's Agent, Sponsor or Administrator. The Plan s Agent for service of legal process is: Vice President - Human Resources Progress Energy Service Company, LLC PO Box 1551 Raleigh, NC Continuation of the Plan and Plan Amendments The Plan Sponsor reserves the right to amend or terminate the plan or any plan benefit at any time based on the cost of the benefits or other considerations without prior approval of or notification to any party. HRI-SUBS Rev. 9 Page 12 of 15

13 Your Rights Under ERISA AUTHORIZED COPY Other Important Information Your Rights Under ERISA The following statement is provided in compliance with the requirements of the Employee Retirement Income Security Act of 1974 (ERISA), as amended. Receiving Information about Your Plan and Benefits As a participant in the Progress Energy, Inc. Welfare Benefit Plan (the Plan ), you are entitled to certain rights and protections under the Employee Retirement Income Security Act of 1974 (ERISA). ERISA provides that all Plan participants shall be entitled to: Examine without charge at the Plan Administrator's office and at other specified locations such as worksites, all Plan documents governing the Plan, including insurance contracts and a copy of the latest annual report (Form 5500 Series) filed by the Plan with the U.S. Department of Labor and available at the Public Disclosure Room of the Employee Benefits Security Administration. Obtain, upon written request to the Plan Administrator, copies of documents governing the operation of the Plan, including insurance contracts and copies of the latest annual report (Form 5500 Series) and updated summary plan descriptions. The Plan Administrator may make a reasonable charge for the copies. Receive a summary of the Plan s annual financial report. The Plan Administrator is required by law to furnish each participant with a copy of this summary annual report. Continue health plan coverage for yourself, spouse, domestic partner or dependents if there is a loss of coverage under the Plan as a result of a qualifying event. You or your dependents may have to pay for such coverage. Review this summary plan description and the documents governing the Plan on the rules governing your COBRA continuation coverage rights. Prudent Actions by Plan Fiduciaries In addition to creating rights for Plan participants, ERISA imposes duties upon the people who are responsible for the operation of the employee benefit plan. The people who operate your Plan, called "fiduciaries" of the Plan, have a duty to do so prudently and in the interest of you and other Plan participants and beneficiaries. No one, including your employer or any other person, may fire you or otherwise discriminate against you in any way to prevent you from obtaining a welfare benefit or exercising your rights under ERISA. If your claim for a welfare benefit is denied, in whole or in part, you have a right to know why this was done, to obtain copies of documents relating to the decision without charge, and to appeal any denial, all within certain time schedules. Enforcing Your Rights Under ERISA, there are steps that you can take to enforce the above rights. For instance, if you request a copy of Plan documents or the latest annual report from the Plan and do not receive them within 30 days, you may file suit in a Federal court. In such a case, the court may require the Plan Administrator to provide the materials and pay you up to $110 a day until you receive the materials, unless the materials were not sent because of reasons beyond the control of the Plan Administrator. If you have a claim for benefits which is denied or ignored, in whole or in part, you may file suit in a state or Federal court once you have exhausted the internal administrative claims and appeals process under the Plan. In addition, if you disagree with the Plan s decision or lack thereof concerning the qualified status of a domestic relations order or a medical child support order, you may file suit in Federal court. If it should happen that Plan fiduciaries misuse the Plan s money, or if you are discriminated against for asserting your rights, you may seek assistance from the U.S. Department of Labor, or you may file suit in a Federal court. The court will decide who should pay court costs and legal fees. If you are successful, the court may order the person you have sued to pay these costs and fees. If you lose, the court may order you to pay these costs and fees (for example, if it finds your claim is frivolous). HRI-SUBS Rev. 9 Page 13 of 15

14 Other Important Information Your Rights Under ERISA If you have any questions about your Plan, you should contact the Plan Administrator or the Employee Service Center. If you have any questions about this statement or about your rights under ERISA, or if you need assistance in obtaining documents from the Plan Administrator, you should contact the nearest office of the Employee Benefits Security Administration, U.S. Department of Labor, listed in your telephone directory or the Division of Technical Assistance and Inquiries, Employee Benefits Security Administration, U.S. Department of Labor, 200 Constitution Avenue NW, Washington, DC You may also obtain certain publications about your rights and responsibilities under ERISA by calling the publications hotline of the Employee Benefits Security Administration HRI-SUBS Rev. 9 Page 14 of 15

15 Contact Information Contact Information Contact Information If you do not find the information you need in this SPD, turn to the resource below for additional information. Employee Service Center The Employee Service Center provides administrative services for plan participants and representatives can be reached by calling or by at HRI-SUBS Rev. 9 Page 15 of 15