Determining When to Set Up Payee Records

You set up retiree records at the time that an employee retires. By setting up the retiree job at the beginning of the retirement process, you ensure that a record is in place to use as you track retirement activities and record optional form selections, tax elections, and other payee information.

You set up terminated deferred-vested records when an employee terminates. You complete the setup all the way through setting up payments, based on the default optional form. Of course, you do not actually start paying the person; you indicate that the payments are in deferred status so that the payment process cannot inadvertently pick up the payment instructions. However, setting up the payments ahead of time provides liability information for the actuarial valuation.

You set up beneficiary records after a retiree dies. It is then that you can be sure that the beneficiary will outlive the retiree and receive survivor benefits. Because you do not set up a beneficiary record until the retiree's death, you can also be sure that the retiree record already exists. This is important, since you associate each beneficiary record with the retiree record for the benefit. Complete the setup all the way through the payment schedule, as with terminated deferred-vested employees. If there is an administrative delay before you start payments, give the schedule a deferred status. This way the information is available for the actuarial valuation even if you have not started payments.

You set up QDRO alternate payee records at the time that you determine that the court order is qualified and you record the amount due to the alternate payee. This is necessary because you record the amount due under the QDRO alternate payee's ID. You do not need to set up the alternate payee's job record until you are ready to run the QDRO calculation, which does require a job record.

In all cases, you should update the pension status at the same time you that set up a payee record.