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Pension issues for EDS alumni  (Electronic Data Systems Corporation)  (Updated Mar 30, 2022.)

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See all of HPAA's information for EDS alumni -- stock, career, benefits, networking, EDS history/culture  -- whether or not you ever worked for HP: https://www.hpalumni.org/eds

1. Legal successors and company names. 

- EDS sale to Hewlett-Packard. In 2008, due to declining growth and profits, EDS stock was down to $19 from $72 in 2001. EDS management and board negotiated a $13.9 billion sale to HP at a 32% premium -- which was completed Aug 26, 2008. (Founder Ross Perot had sold the company to GM in 1984; GM spun out EDS in 1996.)

- HP Breakup. HP Inc, Hewlett Packard Enterprise, DXC, and Perspecta are completely separate companies. Details: HP Breakup

- HP Inc. is the legal successor to the companies acquired by Hewlett-Packard before the company was split into HP Inc. and Hewlett Packard Enterprise. Responsibility for commitments to former employees of Compaq, EDS, etc. remain with HP Inc. -- regardless of whether their last business unit ended up in HP or HPE. Includes employment verification and any retiree health, pension, etc. plans. HPE is responsible for commitments to former employees of companies acquired by HPE.

- At completion of the sale on Aug 26, 2008, EDS was temporarily structured as a wholly-owned subsidiary called "EDS, an HP Company." On Sep 23, 2009, it was renamed "HP Enterprise Services."

DXC is a completely separate company -- not a legal successor corporation to HP or HPE.

Which HP-related companies have me classified as a retiree or former employee? Given HP's history of acquisitions and spinoffs, this may not be obvious. If any doubt, check here: Which Company

Make sure that the legal successor to every company you ever worked for has your current postal address. Even if not classified by the company as a "Retiree" or if long gone -- in case of pension plan changes, employment lawsuits, settlements, or other issues. Update address at former company

For details of a U.S. employer retirement or health plan, obtain a copy of the legal Summary Plan Description ("SPD"). Log into the plan administrator's website or call. They are required by law to provide the SPD upon request. The current SPD takes precedence over any other written, online, or verbal information you may be given -- but is still subject to change. How to use an SPD

Other benefits issues for EDS alumni -- including 401(k), stock, HP and HPE retiree benefits, vehicle discounts. Death or disability of a former employee. https://www.hpalumni.org/edsBenefits

2. HP pension change. If you have been receiving monthly U.S. HP, DEC, or EDS pension payments that commenced on or before November 1, 2020 -- your pension is probably among the 41,000 converted in September 2021 from a company pension administered by Fidelity to an insured annuity provided by Prudential. Details: https://www.hpalumni.org/pension2021

Pension contacts:

- U.S. The HP Retirement Service Center is the primary administrator for HP U.S. pension and 401(k) accounts, including any accounts that HP predecessor companies (such as Compaq, DEC, and EDS) may have had. Operated by Fidelity Investments. 1-800-457-4015 (Outside US 1-508-787-9902 collect.) Fidelity (Don't go to a local Fidelity office.)   Member advice

- UK -- HP, DEC, EDS. HP Limited Retirement Benefits Plan, administered by Equiniti. https://hprbp.com  Second Equiniti site: https://edspensions.co.uk

- Former employee contacts for all countries  HP Worldwide External HR Support

3. "Potential Private Retirement Benefit" letter from Social Security. If "Type of Benefit" is "A" -- you rolled to a different plan, bought an annuity, or took cash. How to decode and what to do: hpalumni.org/PotentialBenefitLetter.

4. EDS pension plans:

If you were employed in the U.S. by EDS or "EDS, an HP Company" before January 1, 2009 you may have an EDS pension that you have forgotten about. If you are not collecting on (or did not cash in) an EDS pension, check for an EDS pension account with Fidelity.

"You may have a benefit in the [EDS Retirement] Plan if you were employed by EDS before HP acquired EDS on Aug 26, 2008, or if you joined "EDS, an HP Company" [quotation marks added] between Aug 26, 2008 and December 31, 2008. The plan was closed to new participants on January 1, 2009. Eligibility to earn Pay-Based Credits to Personal Pension Accounts (PPAs) under the Plan ended on December 31, 2008, although Interest Credits continue to accrue on existing PPA accounts"

"Before December 31, 2008, participation was open to full-time and part-time employees who were employed by EDS or an adopting U.S. subsidiary of EDS. Participation began immediately upon being hired into an eligible classification. Effective December 31, 2008, the Plan was closed to new participants.

"Individuals classified by EDS in the following classifications or other similar classifications were not eligible for Plan participation:
- A resident or nonresident alien not subject to U.S. federal income taxation;
- An employee eligible to participate in the EDS Puerto Rico Savings Plan;
- An employee designated and paid as a leased employee, consultant or independent contractor."

--from the HPAA's copy of the Summary Plan Description (SPD.)

The EDS pension plan has survived the sale to GM in 1984, spin-out from GM in 1996, sale to HP, and the split of HP into HP and HPE. One person referred to EDS founder Ross Perot on the EDS Alumni LinkedIn Group: "Ross is the gift that doesn't stop giving."

EDS Retirement Plan: "EDS Retirement Plan, a sub-plan of the Hewlett-Packard Company Pension Plan" A defined benefit plan.

- EIN: 94-1081436 -- Plan number: 003. Abbreviated as: 94-1081436-003   ("EIN" = IRS Employer Identification Number.)

- HPAA's copy, which may be out of date: EDS Retirement Plan Summary Plan Description (SPD)   [Browser tab displays: "HA Normal" -- where "HA" means "Hewitt Associates."]

Log into the plan administrator's website or call. They are required by law to provide the SPD upon request. (The mailing about the 2020 EDS lump-sum pension buyout offer did not include the SPD -- which covers many key details, including annual interest credit, QDRO, and surviving spouse provisions.)

U.S. The HP Retirement Service Center is the primary administrator for HP U.S. pension and 401(k) accounts, including any accounts that HP predecessor companies (such as Compaq, DEC, and EDS) may have had. Operated by Fidelity Investments. 1-800-457-4015 (Outside US 1-508-787-9902 collect.) Fidelity (Don't go to a local Fidelity office.)

Key points:

The account is growing at 5% per year if you left EDS after July 1, 1998. (HP's own legacy pension plans do not have that feature.)

What if HP goes under? The plan is backed by a trust fund -- and is listed on the federal PBGC website as insured. (Full payout not guaranteed for larger pensions -- $5,812 per month maximum for someone who starts taking pension at 65. See this table:
https://www.pbgc.gov/wr/benefits/guaranteed-benefits/maximum-guarantee )

If employee dies before payments begin, generally payable to surviving spouse or beneficiary. (Details on SPD page 26.)

Key document: "EDS Retirement Plan Summary Plan Description" (the "SPD") Our copy of the SPD is "Updated as of January 2012" Contact Fidelity to determine if there is a newer version.

There are at least two vintages of the EDS plan. Download the SPD from Fidelity that specifically applies to you -- based on when you left EDS.

For example, the "Updated as of January 2012" copy of the SPD does not apply if you left EDS before July 1, 1998. 
It says on page 1: "Benefits for participants who terminated from EDS before July 1, 1998 are subject to separate provisions not described in this SPD. For more information about these benefits, contact the HP Retirement Services Center."

If you left EDS on or after July 1, 1998 -- and have not cashed out or started taking the pension -- the account has been and will continue to grow at 5% per year. "Personal Pension Accounts ...continue to receive Interest Credits, even after ceasing to earn Pay-Based Credits. Your PPA is credited with Interest Credits at a predetermined rate thatís adjusted annually each January 1 subject to a minimum rate of 5% per year. Interest Credits continue to accumulate until your PPA is paid to you or converted to an annuity at retirement." [Page 9 of the Summary Plan Description.]

HP lump-sum payout offers. HP made several lump-sum payout offers to specific segments of EDS retirees over the years:

- 2016: A pension buyout offer was made to those with a "lump-sum present value of your accrued benefit as of Aug 1, 2016" between $5K to $100K. 2016 Pension Lump-Sum Offer

- 2019: EDS folks with small pensions were offered lump-sum payouts -- apparently to reduce admin costs. "At the present time... the Plan does not allow lump-sum distributions for amounts over $5,000. We donít speculate if that policy will change. However, if Plan provisions do change to allow lump sums over $5000, affected participants will be notified via mail." --email in response to inquiry from an EDS alum, April 19, 2019. 

- 2020: A lump-sum pension buyout offer was made to some who have legacy DEC and EDS pension plans. Deadline was July 15, 2020; extended to July 22, 2020. Details: 2020 Pension Lump-Sum Offer

EDS Early Retirement Offer. From the  2007 EDS Annual Report:

- 2007: "We increased the number of employees in Best Shore locations from approximately 32,000 persons at the end of 2006 to approximately 41,000 at the end of 2007... Our 2007 initiatives to increase capabilities in Best Shore locations included the transfer of certain internal administrative functions... We expect to significantly increase our overall investment in workforce alignment in 2008 compared to 2007. During the third quarter of 2007, we announced an early retirement offer ("ERO") for approximately 12,000 U.S. employees. Approximately 2,400 employees accepted the ERO. Employees accepting the offer will receive enhanced retirement benefits payable through normal payment options under the EDS Retirement Plan."

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