South Hadley, Massachusetts, Employer Agrees to Restore Unpaid Pension Funds to Plan Participants as the Result of U.S. Labor Department Lawsuit

Archived News Release — Caution: Information may be out of date.

Raymond Turcotte, the president and owner of the now defunct Quantum Electric, Inc., of South Hadley, Massachusetts, has agreed to pay to the participants of his company’s pension plan over $66,000 in contributions (including interest) which the company failed to pay into the plan over the past three years, the U.S. Labor Department announced today.

According to James Benages, Boston Regional Director for the department’s Pension and Welfare Benefits Administration (PWBA), the agreement is part of a consent judgment and order obtained as the result of a lawsuit filed by his agency against Quantum Electric, Inc. and Raymond Turcotte.

The suit alleged that the company was the sponsor of the Quantum Electric Prevailing Wage Pension Plan established in 1994, and that the company and Turcotte were fiduciaries with respect to the Plan. The suit charged that the defendants failed to ensure that at least $58,733.50 in contributions for the year 1998 were paid to the Plan on behalf of its participants, who were employees of Quantum Electric. The suit also alleged that the defendants handled funds of the Plan without obtaining a fidelity bond. These were alleged violations of the federal Employee Retirement Income Security Act (ERISA), which protects employee pension and welfare benefit plans and which is administered by PWBA.

The consent judgment and order, signed by U.S. District Judge Frank Freedman on January 11, 2001 permanently prohibits Quantum Electric from acting as a plan administrator to any ERISA-covered plan. It also prohibits Raymond Turcotte from ever again acting as a fiduciary or service provider to any ERISA-covered plan. The order also requires Turcotte to pay a total of $66,451.53 (plus interest until the judgment is satisfied) to the participants of the Quantum Electric Prevailing Wage Pension Plan. The judgment allows Turcotte to make the payment in installments into an independently administered interest-bearing account over a period of years.

Benages noted that Quantum was an electrical contractor which had worked on various prevailing wage federal, state and municipal contracts. Consequently, the company’s employees working on those contracts were due fringe benefits under both federal and state prevailing wage laws. The pension plan had been established to provide those fringe benefits. The company is no longer in business.

The department’s legal action against the defendants followed an investigation by the Boston Regional Office of the Pension and Welfare Benefits Administration. That office is located in Room 575 of the John F. Kennedy Federal Building in Boston. The telephone number is 617.565.9600.

(Herman v Quantum Electric, Inc., and Raymond Turcotte
Civil Action No. 01-30005-FHF)

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Archived News Release — Caution: Information may be out of date.