Can You Collect a Union Pension and Still Work Full-Time?

Union pensions provide a predictable income stream after working careers conclude. Many recipients consider supplementing their income through continued employment. Understanding the specific regulations governing union pensions, particularly concerning re-employment, is important for managing personal finances. This involves navigating plan provisions that dictate how earned income interacts with pension benefits.

Pension Eligibility and Working Status

Eligibility for union pension benefits hinges on meeting specific criteria related to age and years of service within covered employment. Plans require individuals to reach a certain age and accumulate a defined number of service years to become vested and receive a pension. Some plans define “retirement” as formally ceasing employment with a contributing employer.

While many union pension plans permit retirees to work in other industries or for non-contributing employers without impacting benefits, working within the same industry or for a contributing employer can lead to benefit adjustments. This is often termed “disqualifying employment” or “prohibited employment.” The rules for such employment vary significantly, depending on the retiree’s age and the nature of the work. Some plans may suspend benefits if an individual returns to work for a participating employer, while others might allow work for a non-participating employer without suspension.

Impact of Earned Income on Union Pension Benefits

Earning income while receiving a union pension can directly affect benefits, often leading to a reduction or temporary suspension of payments. Many union pension plans, particularly defined benefit plans, incorporate “suspension of benefits” rules. These rules involve specific thresholds for earned income or hours worked within “disqualifying” or “prohibited” employment. Defined benefit plans promise a specific monthly payment in retirement, often based on factors like salary history and years of service, and are funded by the employer.

Exceeding the set limits, such as working more than 40 hours per month in covered employment, can trigger a suspension of pension payments for that month. For example, some plans suspend payments for individuals under age 65 engaged in prohibited employment, while for those between ages 65 and 70.5, the suspension might occur if they work more than 40 hours per month in such employment. Plans often have different rules for those under normal retirement age compared to those at or above it. Once individuals reach a certain age, such as 70.5 or 72, many plans allow them to work without any restrictions on their pension benefits.

Accessing Your Union Pension Plan Details

To understand how working might affect individual pension benefits, review the specific details of your union’s pension plan. The Summary Plan Description (SPD) is a legally required document that outlines the plan’s rules, including eligibility, benefit calculations, and re-employment provisions. It provides information on re-employment rules, earnings limitations, and specific definitions of “retirement” or “covered employment.” Plan administrators are legally obligated to provide the SPD free of charge to participants.

The SPD details the types of employment considered “disqualifying” and the age at which these restrictions may no longer apply. It explains the procedures for reporting re-employment and the consequences of not adhering to these rules, which can include benefit suspension. For personalized advice or clarification, contacting the plan administrator directly is recommended. They can provide guidance on your specific circumstances and ensure you comply with all plan requirements to avoid unintended benefit suspensions.

Social Security Earnings Considerations

Working full-time while collecting a pension also requires understanding Social Security earnings limits, which operate independently of union pension rules. If an individual claims Social Security benefits before reaching full retirement age, annual limits apply to earned income before benefits are reduced. For instance, in 2025, if you are under full retirement age, Social Security deducts $1 from benefits for every $2 earned above $23,400.

In the year an individual reaches full retirement age, a higher earnings limit applies before that month. For 2025, this limit is $62,160, and Social Security deducts $1 for every $3 earned above this amount. Once an individual reaches full retirement age, there is no limit on earnings, and Social Security benefits are not reduced. Pensions, annuities, investment income, and other retirement distributions are not counted as earned income for Social Security earnings test purposes.