CARING FOR THOSE WHO SERVE 1201 Davis Street Evanston, Illinois 60201-4118 847-869-4550 www.gbophb.org Part-Time Clergy February 2010
The Clergy Retirement Security Program (CRSP) originally provided both defined benefit (DB) and defined contribution (DC) benefits to part-time clergy. CRSP DB benefits were prorated by appointment percentage. CRSP DC contributions were based on actual compensation, which automatically scales the benefit. In response to input from conference benefits officers, the General Board of Pension and Health Benefits (General Board) proposed excluding clergy appointed less than half-time from participation in the DB portion of CRSP. However, conference benefits officers suggested that this was too harsh. So, the General Board submitted a petition to General Conference 2008 that amended CRSP to exclude less than quarter-time clergy from participation in the DB portion of CRSP. General Conference 2008 directed the General Board to study appropriate benefits for part-time clergy and report back to General Conference 2012. Definition of Part-Time Feedback received since General Conference 2008 suggests that some CBOs would prefer that the clergy retirement plan exclude from participation, or allow the conferences to exclude from participation, clergy serving less than half-time. As a benchmark, the Employee Retirement Income Security Act of 1974 (ERISA) permits retirement plans to exclude from participation employees who work less than 1,000 hours per year. CRSP, as a church plan, is not subject to ERISA, but it follows many of its provisions. The United Methodist Personal Investment Plan (UMPIP) allows plan sponsors to exclude from participation those employees who are not scheduled to work at least 1,040 hours per year. Non-qualified church-controlled organizations (non-qccos) cannot exclude from participation those employees who are scheduled to work at least 1,000 hours. Scaling Benefits for Clergy Serving Less Than Full-Time Any retirement plan that provides benefits proportional to compensation automatically scales benefits for those serving less than fulltime, since their compensation is expected to take into account their part-time status. CRSP DB, which is based on the Denominational Average Compensation (DAC), provides benefits of equal dollar amount, so it includes provisions to prorate credited service by appointment percentage. However, in addition to scaling benefits, it eliminates DB benefits for participants who serve less than quarter-time. They receive only DC contributions. 1
Our Part-Time Population Almost 4,500 clergy out of 23,500 total active clergy or 18% of all active clergy serve less than full-time. Of those who serve less than full-time: 62% are male, 68% are part-time local pastors, and 74% are married. Of those part-time clergy who responded to our survey, 61% reported that they have no other job. Of the 39% who reported that they did have other jobs, 50% of those jobs offered retirement benefits. 57% of part time clergy survey respondents were male. 72% of female respondents and 53% of male respondents reported that they have no other job. Most part-time clergy serve half-time or less: 2
Most of the less-than-full-time clergy earn less than $30,000. Most of the less-than-full-time clergy are age 50 and above. 3
Survey respondents gave the following reasons for serving part-time, with marked differences in reasons between elders and part-time local pastors: Not offered full-time appointment Temporary basis Prefer full-time but not willing to make sacrifice Preparing for retirement Attending seminary Prefer to serve less than full-time DEACONS ELDERS LOCAL PASTORS 4
The number of less than full-time clergy (whether elders or local pastors) varies by conference. 5
The proportion of less than full-time clergy also differs by conference. Any plan design should scale benefits for those clergy serving less than full-time as the retirement plans do today, and consider whether conferences should have the option to exclude from participation those clergy serving less than half-time. 6
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