The Diocese of Fall River, Massachusetts, froze its pension plan for all employees as of the end of 2015.
The pension plan was deemed “unsustainable” by the Diocesan Financial Council last year, according to the Fall River Herald News. Diocesan employees will now have the option to participate in a 403(b). According to the news report, Diocese of Fall River will an employee’s contribution to the 403(b) plan up to 2.5% of salary.
While church pension plans are not insured by the Pension Benefit Guaranty Corporation (PBGC), an adviser to the plan told the newspaper that despite the diocese’s recent financial struggles, the pension funds that employees have already accrued should not be in immediate danger.
Many dioceses around the country, including Boston, Cincinnati and Minneapolis-St. Paul, have terminated their defined pensions and moved to offering employees a defined contribution plan. A survey last year by USI Consulting Group found more than 57% of Catholic dioceses are planning to freeze or terminate their pension plans.