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Pension plans frequently provide for early retirement
benefits. Such early retirements often commence at age 55 and
require the fulfilment of a minimum period of service. The value
of the early retirement benefit is calculated by first
determining the amount that would be payable to the participant
at normal retirement age, given the participant’s service and
compensation as of the date of early retirement. This value is
then reduced by a factor reflecting that benefit payments will
begin earlier than was contemplated and, therefore, are likely to
continue for a longer period of time. Often, however,
early-retiring employees are provided benefits which are not so
reduced. “The provision of an early retirement benefit greater
than the actuarial equivalent of the normal retirement benefit is
referred to as a subsidized early retirement.” Bellas v. CBS,
Inc., 221 F.3d 517, 525 (3d Cir. 2000) (citing McGill & Grubbs,
Fundamental of Private Pensions 131-135 (6th ed. 1989)); see,
e.g., Rybarczyk v. TWR, Inc., 235 F.3d 975, 978 (6th Cir. 2000)
(“The benefit received by early retirees was called, in the
jargon of the cognoscenti, a ‘subsidized’ benefit.”).8
8 See also Dade v. N. Am. Phillips Corp., 68 F.3d 1558, 1562
n.1 (3d Cir. 1995) (citing Bruce, Pension Claims Rights and
Obligations 285 (1993)) (benefits paid under an early retirement
program, in light of sec. 411(d)(6)(B)(i), “are considered early
retirement subsidies because ‘more is provided * * * than any
reasonable actuarial equivalent of the plan’s normal retirement
benefits.’”); Ashenbaugh v. Crucible, Inc., Ret., 854 F.2d 1516,
1521 n.6, 1528 n.12 (3d Cir. 1988) (benefits to an employee
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