My Spouse Has A Pension?

A common question which people going through a divorce ask involves a pension plan.  The person who has the pension wants to know what if any part of the pension is the other spouse entitled and conversely, the spouse that does not have the pension wants to know what if any portion of the pension are they entitled.  The leading case in this area is Majauskas v. Majauskas.

In Majauskas, the husband was a police officer and after ten years on the job, his pension rights vested.  An action for divorce started, and his wife sought part of the pension as marital property.  The first step of the analysis is to determine what marital property is to be distributed.   By New York statute, marital property is defined as all property acquired by either or both spouses during the marriage and before the execution of a separation agreement or the commencement of a matrimonial action.  Excluded from this definition is property acquired before marriage or through gift or inheritance or compensation for personal injury. However, these funds cannot be comingled or else they lose their separate property category. Separate property can also be designated by agreement between spouses. 

Now that we have a working definition of marital property, vested rights in a pension plan that were acquired between the date of marriage and the commencement of an action for divorce is marital property.  In Majauskas, the husband unsuccessfully argued that his pension began before marriage and therefore should be considered separate property.  The Courts held that even though the plan started before the commencement of the marriage, the spouse is entitled to her share of the pension plan which accrued during the marriage.  Thus, the Courts determined a formula that is: one half of each pension check multiplied by the fraction of the number of months the parties were married bears to the total months the plaintiff earned in retirement.  For example, if you were married five years, and you have a pension with twenty years of service, you first divide the pension in half.  Take that number and multiply by the years married/total years for the pension.  Years married—five—divided by 20 total years equals 25%.  Your spouse would be entitled to 25% of half of the pension.

This formula determines your pension which you are entitled to and for the party with the pension this calculation would determine the percentage of pension that you would be obligated to give your soon to be ex-spouse.