Severance Pay Plan February 2016 AGENDA Notice and Severance Pay - - PowerPoint PPT Presentation

Notice and Severance Pay Plan

February 2016

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AGENDA

• Notice and Severance Pay Plan (NSPP)
• Medical, Dental, Retiree Medical, COBRA
• Flexible Spending Accounts
• Health Savings Accounts
• Life Insurance and Disability Coverages
• Savings Plan
• Supplemental Retirement Plan II
• Supplemental Savings Plan
• Other Retirement Plans
• Employee Stock Purchase Plan
• Long-Term Incentive Plan
• Vacation
• Health Advocate – EAP
• Health Advocate – Advocacy
• Other Programs
• Educational Assistance
• Matching Gifts

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• Payments on regular paydays in regular base pay amount
• Payroll deductions continue (i.e., taxes, benefit deductions)
• Payroll direct deposit continues
• All benefits continue through Notice; medical and dental through

Severance

• Health Advocate services continue through Severance
• Employee Assistance Program (EAP)
• Advocacy

NOTICE AND SEVERANCE

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• Notice (two months)
• Severance
• Full vesting in Savings Plan
• Medical and Dental continue through Severance
• Enhanced Retiree Medical Eligibility
• Requires signed “Separation Agreement and General Release”

to receive Severance

• Service calculation for Severance
• Based on service through end of Notice Period
• Rounds to nearest whole year:
• For example, 4 years + 5 months = 4 years

NOTICE AND SEVERANCE – OPTION A

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• Provides two months Notice Pay plus Severance Pay up to ten

months depending on years of CRC service (includes Oxy service)

NOTICE AND SEVERANCE – OPTION A

Years of Service ice Not

• tice

ice Severa erance nce Less than 4 years 2.0 months 1.0 month 4 years 2.0 months 1.5 months 5 years 2.0 months 2.0 months 6 years 2.0 months 2.5 months … … … 20 or more 2.0 months 10.0 months

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• Notice only (two months)
• No Severance
• Full vesting in Savings Plan
• Participation in all benefit plans and programs ceases at end
• f Notice
• Regular Retiree Medical Eligibility
• Age 55 with 10 years of service

NOTICE AND SEVERANCE – OPTION B

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• During Severance Payments
• If you or your covered dependent(s) will not be eligible for Medicare at the end
• f Severance payments
• Participation in medical and dental plans continues at employee rates on

an after-tax basis

• May change from HMO to Aetna plan if relocate out of service area

MEDICAL AND DENTAL COVERAGE – OPTION A ONLY

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• During Severance Payments
• If prior to the end of Severance, you or a dependent will be eligible for

Medicare and you will not be eligible for retiree medical and dental coverage

• Participation in medical and dental plans continues at employee rates on

an after-tax basis

• May change from HMO to Aetna plan if relocate out of service area

MEDICAL AND DENTAL COVERAGE – OPTION A ONLY

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• During Severance Payments
• If prior to the end of Severance, you or a dependent will be eligible for

Medicare and you will be eligible for retiree medical and dental coverage

• Participation in the dental plan at employee rates continues on an after-tax basis and

continues to be deducted from NSPP payments

• Medical payroll deductions cease at the end of Notice
• Continued medical coverage will be under the CRC Retiree Medical Plan immediately

following Notice

• Monthly contributions for retiree medical coverage will be sent to PayFlex (CRC’s

billing administrator)

• You and/or your Medicare-eligible dependent(s) should enroll in Medicare Part B, to

be immediately effective following Notice (or attainment of Medicare eligibility, if later)

MEDICAL AND DENTAL COVERAGE – OPTION A ONLY

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• Enhanced eligibility
• 30 or more years of service
• Age 50 or older with at least 5 years of CRC service, with combined age and

service = 65+

• Example:

RETIREE MEDICAL AND DENTAL ELIGIBILITY – OPTION A – ENHANCED ELIGIBILITY

Age 51 years, 8 months + Service 14 years, 6 months = 66 years, 2 months Age 58 years, 5 months + Service 7 years, 6 months = 65 years, 11 months

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• Immediate enrollment (first of the month following Notice)
• Age 55 with 10 years service
• If you waive Retiree Medical Coverage at this time, you must show proof of loss
• f other coverage before you may enroll for CRC Retiree Medical Coverage

RETIREE MEDICAL AND DENTAL ELIGIBILITY – OPTION B

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• Two options available under the CRC Retiree Medical Plan
• Aetna Option - Plan similar to the Aetna Core medical plan option for active

employees

• Once eligible for Medicare, Medicare becomes your primary coverage and the CRC

plan becomes secondary

• Kaiser Option –
• Traditional Plan (same as the Kaiser plan for active employees) for non-Medicare

eligible participants, and

• Senior Advantage Plan (a Medicare Advantage HMO) for Medicare-eligible

participants

• You and/or your spouse must enroll in Medicare Part A (hospital)

and Part B (medical) as soon as you become eligible for

• Medicare. If you do not timely enroll for Medicare Part B,

Medicare will impose a lifetime financial penalty

• You do not need to enroll in a Medicare Part D prescription

coverage plan

RETIREE MEDICAL COVERAGE

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RETIREE MEDICAL CONTRIBUTIONS

Points ts Non-Medica edicare Eligible ible Medicar icare e Eligible ible 65 – 69 4 times 2 times 70 – 74 3 times 2 times 75 – 79 2 times 2 times 80 or more 1 times 1 times

• Retiree Medical Plan contributions are multiple of the Retiree

Medical Base Rate based on a combination of age and service as of the last day of NSPP payments 2016 Monthly thly Ret etiree iree Medical ical Base e Rates es Ret etiree ee Only Ret etiree ee + One Family ily Aetna $120 $240 $360 Kaiser $90 $180 $270

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• Aetna is the only available Retiree Dental Plan option
• Plan similar to the Aetna Dental Plan for active employees
• Retiree dental coverage is not subsidized, so retirees pay the full

cost of coverage

RETIREE DENTAL COVERAGE

2016 Monthly thly Ret etiree iree Denta tal Rates es Retiree Only Retiree + One Family $47 $94 $141

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• COBRA continuation coverage available following NSPP payments
• Up to 18 months
• COBRA notice mailed to home at end of NSPP payments
• Charge is 102% of full cost
• If you are eligible for retiree dental coverage, you may elect COBRA dental

for up to 18 months prior to enrolling in retiree dental coverage

MEDICAL AND DENTAL PLANS – COBRA

2016 Monthly thly COB OBRA RA Rates es

Employee Only Employee + One Family Aetna Core $618.12 $1,236.24 $1,854.36 Aetna High Deductible $519.18 $1,038.36 $1,557.54 Kaiser $439.88 $879.76 $1,407.61 United Healthcare $574.75 $1,149.47 $1,850.69 Aetna Dental $39.78 $79.56 $138.72

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• Elected 2016 contributions continue through Notice
• Expenses incurred during the period contributions are made may

be submitted for reimbursement

• Reimbursement rules:
• Health Care – as incurred through end of Notice, up to full election amount
• Dependent Care – as incurred through end of Notice, up to balance in

account

• After Notice, Health Care FSA election may continue (after-tax)

through COBRA

• Ultimate submission deadline for 2016 spending accounts is

March 31, 2017

FLEXIBLE SPENDING ACCOUNTS

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• Payroll deduction of HSA contributions will cease at end of

Notice

• You may continue to make direct contributions to your HSA on an

after-tax basis, as long as you are enrolled in a high deductible health plan

• You will be responsible for the monthly administration fee

beginning after Notice, currently $4.00/month

• Your account is eligible to be moved to other banking institutions

that offer HSA accounts

HEALTH SAVINGS ACCOUNT

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• Basic Life coverage continues through the end of Notice
• Conversion to individual policy available – Contact Prudential within 31 days

after coverage ends at 800-562-9874

• Occupational Accidental Death & Dismemberment continues

through end of Notice

• Accidental Death & Dismemberment continues through end of

Notice

• Coverage may be cancelled or reduced at any time by contacting

CRCBenefits@CRC.com

• Conversion to individual policy available – Contact AC Newman within 31

days after coverage ends at 877-226-8711

LIFE INSURANCE PLANS

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• Deductions continue through end of Notice
• Portable to individual policy
• Contact Prudential at 800-562-9874, to change or arrange

continuation of coverage

• You may cancel your coverage at any time by contacting

Prudential

GROUP UNIVERSAL LIFE (GUL)

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• Coverage ceases at the end of Notice
• Conversion to an individual policy not available

SHORT-TERM DISABILITY (STD) AND LONG-TERM DISABILITY (LTD)

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• Contributions and Match continue through Notice
• Applies to accrued vacation payout
• Vesting
• Employee and Company matching contributions – always 100% vested
• Company retirement contributions – 100% vested at the end of Notice

CRC SAVINGS PLAN

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• Payroll deductions will continue for loan repayments during

Notice

• Fidelity will send information regarding your loan status

approximately 30 to 60 days following Notice

• You can continue to make monthly loan payments directly to Fidelity
• If monthly payments not set up at Fidelity, and outstanding balance not paid in

full, loan will default and be treated as taxable distribution

• Non-repayment does not affect your credit score
• Tidelands savings plan loan payments can also continue, contact

Prudential at 877-778-2100

CRC SAVINGS PLAN – LOANS

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• You have the option to defer distribution until age 70 ½
• Distribution available after end of Notice
• Request distribution via Fidelity website at www.401k.com or call

800-835-5097

• Distribution Options
• Cash distribution
• Partial cash distribution
• Rollover to IRA, Roth or other qualified plan

CRC SAVINGS PLAN – DISTRIBUTION

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• Distributions of before-tax account balances are subject to

taxation unless rolled over to an IRA or another employer’s qualified plan

• 10% additional federal early withdrawal penalty generally applies

unless:

• Payments for life or life expectancy (annuities)
• You leave employment in the year you attain age 55 or later
• After attainment of age 59 ½
• Direct transfer to an IRA or another employer’s qualified plan
• Taxable amounts not directly transferred to an IRA or another

employer’s qualified plan are generally subject to a mandatory 20% federal withholding and a 2% California state withholding

• Special tax treatment may be available
• Consult with a qualified tax advisor
• Contact Fidelity for more information

CRC SAVINGS PLAN – DISTRIBUTION TAX CONSIDERATIONS

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• All SRP II participants are fully vested in account balance
• Distribution
• According to your previously elected option
• Total Cash Payment – made in the first 90 days of the year following the year in which

your Notice ends

• Annual Installments – the first installment will occur in the first 90 days of the year

following the year in which your Notice ends

• If your balance is $50,000 or less or if you did not submit a distribution

election within the first 30 days of your SRP II plan entry date, you will receive a total cash payment in the first 90 days of the year following the year in which your Notice ends

• Interest allocations will continue to accrue monthly at the prevailing

rate of return specified in the SRP II (currently 5-year Treasury Bills plus 2%) through the end of the processing month prior to the month in which a payment is processed

• Your payments will be taxable to you as ordinary income and are not

eligible to be rolled over to an IRA or another employer’s qualified or nonqualified plan

SUPPLEMENTAL RETIREMENT PLAN II (SRP II)

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• This is a new non-qualified plan to provide company matching

and retirement contributions missed due to the IRS qualified plan limits

• Eligible participants were sent information in January. If you

become eligible during 2016, information will be sent to you during the first quarter of 2017.

• Distribution option – If your balance is $50,000 or less, you will

receive a total cash payment in the first 90 days of the year following the end of Notice

• Your payments will be taxable to you as ordinary income and are

not eligible to be rolled over to an IRA or another employer’s qualified or nonqualified plan

SUPPLEMENTAL SAVINGS PLAN (SSP)

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• Tidelands and THUMS employees may have a vested benefit

under either the Tidelands Oil Production Company Employees’ Pension Plan or the THUMS Employees’ Pension Plan

• Participants will be eligible to take distributions following Notice
• For information regarding your THUMS or Tidelands pension

benefit contact CRC Pension Service Center at 888-909-4156

OTHER RETIREMENT PLANS

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• Contributions cease at the end of Notice
• If you are age 65 or over at end of Notice, accumulated

contributions will be utilized to purchase stock at the end of the quarter

• If you are under age 65, accumulated contributions will be paid
• ut following end of Notice
• You can withdraw from the quarterly purchase at any time during

the quarter

• Purchased stock remains in your account
• 3 month hold still apples

EMPLOYEE STOCK PURCHASE PLAN

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• All outstanding long-term incentive awards will be reduced on a

prorated basis and become immediately payable following the end of Notice

• Proration is based on the number of days employed during the

vesting period

• Payment will be processed by Morgan Stanley and CRC payroll

LONG-TERM INCENTIVE PLAN

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• Vacation earned through end of Notice
• Accrued and unused vacation paid as soon as practicable

following end of Notice

VACATION

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• EAP services remain available to employees and their dependents

through the end of Notice and Severance payments and while on COBRA continuation coverage

• Company-paid, confidential counseling resource
• Up to 8 face-to-face sessions
• Obtain help for a variety of situations
• Stress, depression, anxiety
• Marital relationships, family/parenting issues
• Anger, grief and loss
• Addiction, eating disorders
• Elder care assistance and much more
• Available if enrolled in the CRC Retiree Medical Plan
• EAP services are provided through Health Advocate 24/7
• By phone at 866

866-799-2728, or

• Online at HealthAdvocate.com/members, enter “California Resources

Corporation”

EMPLOYEE ASSISTANCE PROGRAM (EAP)

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• Health Advocacy
• Provides help with a full range of health care issues including,
• Finding network providers
• Untangling insurance claims
• Navigating Medicare
• Assisting with elder care issues
• Scheduling appointments with specialists
• Health condition coaching
• Assisting with special needs
• Advocacy services remain available to you and your family members through

the end of Notice and Severance payments

• If enrolled in retiree medical coverage, advocacy services remain available to

you and your family

HEALTH ADVOCATE - ADVOCACY

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• Educational Assistance – expenses applied for and approved for

reimbursement prior to Notice will be eligible for reimbursement (even if course of study is completed during or after the end of your Notice and Severance payments)

• Matching Gifts – Company will match all eligible gifts submitted

prior to end of Notice

OTHER PROGRAMS

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Following this meeting send questions to: CRCBenefits@crc.com

QUESTIONS