MS and Long Term Disability

Walker34

Hi,
I was diagnosed with MS a few years back and was working for a large US multinational at the time.I was very ill at the time and had suffered under cover for almost a year without knowing what the hell was wrong with me. I had what I now know were all the classic symptoms,fatigue,weakness,staggering,falling,memory loss,ect. (I might add its a mighty dark road to walk when you are in that predicament with a young family and a mortgage) My local GP reckoned I was depressed and sold me Seroxat for 6 months but i knew it was a little more obvious than that. In desperation I went to the resident company nurse one day and spilled my story,she was a nice Australian person and she proceed to look very concerned and took a lot of notes, she asked me to go see the company doctor.

I obliged and went to the company doctor who just asked me to walk "heel to toe" across the room.......it was impossible in my state and I almost fell a few times. He sent me to Vincents hospital immediately, I had an MRI 3 days later and was diagnosed within a week. This is a much shortened version btw.

I took one day off and on the next day back at work I went to see the nurse to thank her for her help, as I now knew I was not terminal or insane. She told me to come in and close the door and take a seat. She told me that on the day i went to the company doctor a junior HR official came to her office and demanded all the notes she had taken of my interview. She had refused and the official had told her that on account of the fact she was employed by the company the notes and the details therein were company property. What really freaked me was the fact that the company doctor must have told HR immediately, so the company knew had MS before I did. How American.

This revelation sent me deep into paranoia land, I was convinced they would seek to get rid of me. Its a long story after that, but suffice it to say I am still walking and not working, being on LTD since that time.

The LTD contributory plan clearly states that my income continuance would increment by 5% compound but it has not and now my solicitor tells me that I really don't have any case.....which is beyond me, when it is signed by a trustee of the pension plan. Is anything credible anymore?
Any comments or advice would be welcome, and be aware that for medical people, they are loyal to their employers only.

Tom Young

While this is an awful story and I am really, really sorry to hear that you're unwell.

The forum charter does not allow us to post up legal advice on any matter. Maybe get a second opinion from a differing solicitor to the one you are using.

Walker34

Appreciate comment Tom, btw the Pensions Ombudsman was at pains to point out that they don't cover Contributory pensions, another amazing revelation. What exactly DO they cover?

Deesse

What a terrible story Walker. You have my sympathies for what you're being put through, and for the lack of pointers you're getting here. Good on you're Australian nurse - the only ray of light in the story!

If your solicitor is using superhuman legal skills beyond those bestowed on the rest of us ordinary mortals, then he should qualify why you "don't have a case", when presumably you've mastered the art of reading, and have seen it written in your contract that your pension should be compounded. After all, I've no doubt that you're paying him!

Record your interviews, BUT ONLY WITH HIS PERMISSION, as this may focus any wishy-washy advice you may feel you're getting. Report him if he's talking rubbish and get a new one. Alternatively, the citizen advice bureaus often have a barrister/solicitor on certain nights dispensing free advice, so you could enquire about that.

Be aware that compounding can be done over different periods: the most favourable for you would be continuous where the future value of a present value is calculated by FV=PVxEXP[rt]. This is just the limit, as the compounding frequency (n) goes to infinity, of the following formula: FV=PVx[1+r/n]^nt. For example, compounding twice a year n=2, compounding every month n=12, etc. Maybe your contract specifies compounding every 5 or 10 years or something more favourable to the company!

Finally, have a look at a film called "The Corporation" and you'll see that you're far from being paranoid on these issues:-)

Walker34

IMHO,
Interesting comment Deesse,love the formulas, takes me back to my MechEng days and statistics. I tend to take these contracts on their face value though,and this one does seem to be written in good faith. There are even worked examples for the cognitively challenged (like me), check this out for example:-

"Any amount increased in terms of section(3) of this Provision shall not exceed an amount calculated on each anniversary of the due date of payment of the first installment by dividing its initial amount by its initial figure by the index figure relating to the third calendar month before that in which the due date of the payment of the first installment occurred and multiplying the amount so obtained by the index figure relating to the third calender month before the anniversary on which the increase is to be given."

Its simple really, it means that the increase given will not be greater than either the cost of living index for that year or 5%. Now if the cost of living index was -5% for the last 10 years then the police is good to its word,but I don't think so some how.(thats sarcasm btw,so please don't clarify). I kinda accept that I was always a bit on the naive side, but when a legal contract states that the amount will increment by the lesser of 5% or the cost of living index I tend to take a Doodle McGuire position on it and say Oh!right ye are Ted.!
Am I oversimplifying matters here or what?

Victor

Walker34 wrote: »

The LTD contributory plan clearly states that my income continuance would increment by 5% compound but it has not and now my solicitor tells me that I really don't have any case.....which is beyond me, when it is signed by a trustee of the pension plan. Is anything credible anymore?

I can't see how the plan states it will increment yet you solicitor can't see this. Get a second opinion.

Walker34 wrote: »

Any comments or advice would be welcome, and be aware that for medical people, they are loyal to their employers only.

On the contrary, they have a professional, ethical responsibility to their patients for which they can be held accountable. There may also be the matter of the Data Protection Act.

Deesse

Hi Walker.

If it's as clear-cut as it seems (superficially), and you're talking to your solicitor over it, it's reasonable for me to assume then that you've put your case to the company and they've told you to get stuffed?
Being employed by a US multinational, as you said at the start, I assume you're non-unionised, so you have to do your own negotiation. Without knowing what's being said - and don't tell me here in case it backfires on you - it would seem like a good idea to keep pestering the company directly as - if it's the company i think it is - they have more lawyers than workers on their books, just waiting to see you swallowed up by the Man!

If you feel face to face discussion is not feasible, then think about doing what i and Victor suggested in previous posts

Interesting point from Victor on Data Protection, and worth checking out with your adviser. I'd imagine though that he's owned by the company in his contract, and you've probably waived any rights to privacy in yours! US law enschrines a corporation's status as an entity, with a right to survival!!!

Walker34

Clause (3) of the policy states:-

"Subject to section (4) of this Provision while a disability benefit is being paid, the annual amount of the benefit shall be increased on each anniversary of the due payment of the first installment by five per cent of the amount paid in the first year."

Sounds straight-forward to me Ted.!

Clause (4) is the one I previously quoted.
If I were to publicize this whole messy process in a website which I'm thinking of hosting would the company have grounds to sue me for disclosure or something equally obscene.

Walker34

That should have read ........"of the amount paid in the previous year" a subtle but critical difference.

Deesse

Well now it really does look simple! It should be compounded annually by the lesser of 5%, or some cost of living/inflation index by my reading. The maximum increase in, say, year 13 of your pension would be FV=PVx(1+0.05)^12, so it should be around 1.8 times the original payment.
Is it that they have made zero increase (looks like it from your little burst of sarcasm in post#5) over the original payment, or is your bone on contention with the inflation/cost of living rates they have applied to determine the increments? Perhaps they use US figures if it's a US company? Perhaps there's some other small print that factors in the currency exchange rates maybe?
I'm no expert, but I'd hold off sticking contracts or exact details up on a web page anywhere, just in case this ends up in court and you prejudice yourself in some way.

Walker34

The way it works Deesse is that an insurance company actually makes the payment to me through the company I worked for. Its like the policy covers the company against the risk that one of their employees should become disabled or ill, either short term or long term. The insurance company,in this case, is a well known UK based company. Its the standard practice of corporations to outsource the management of things which do not fit within their immediate core competency to other entities who specialize in those things. In this case its outsourcing longterm disability management to the insurance sector.

Walker34

For the first few years(2) it seemed to increase correctly, but then it stopped and did not increase at all. I got a spreadsheet of the payments for the past ten years and on 2 occasions, once off payments were made with a note attached which said, "increase due was not made in 199x hence x is being paid as recompense"......but that totally ignores the "compound" term. Its a complete mess really and by my own calculations on a simple Excel spread sheet the current amount falls well short of where it should be.

I keep trying to examine the phrasing and semantics to see if I am missing something obvious in the meaning of the policy, but, as you suggested, I am seeing another solicitor on Monday to discuss it with him. He advised me as to the options available to me back when I was first diagnosed, and at that point based on the best available information,taking the LTD option was the prudent thing to do.As with many US multinationals, "Re-orgs" happened on a quarterly basis and each time one did the workforce was pruned. Thanks for your input though and learn from my experience.

Victor

Walker34 wrote: »

Clause (3) of the policy states:-

"Subject to section (4) of this Provision while a disability benefit is being paid, the annual amount of the benefit shall be increased on each anniversary of the due payment of the first installment by five per cent of the amount paid in the first year."

This is simple interest, not compound interest.

Year |No adjustment |Simple |Compound
1 | £10,000 | £10,000 | £10,000
2 | £10,000 | £10,500 | £10,500
3 | £10,000 | £11,000 | £11,025
4 | £10,000 | £11,500 | £11,576
5 | £10,000 | £12,000 | £12,155
6 | £10,000 | £12,500 | £12,763
7 | £10,000 | £13,000 | £13,401
8 | £10,000 | £13,500 | £14,071
9 | £10,000 | £14,000 | £14,775
10 | £10,000 | £14,500 | £15,513

Thats insurers for you.

Deesse

No Victor, it's compound. If you have a look at post #9, Walker corrects his previous typo in #8.

Victor

Oooops.

Check with the insurer that the policy you have matches their understanding then.

I wonder who is the ultimate underwriter here. The pension trust, the employer or the insurer.