Private Pension Reform Act of 1981

Private Pension Reform Act of 1981 - Amends the Internal Revenue Code to allow to a married individual whose compensation is less than that of his or her spouse the same deduction for retirement savings. Includes as compensation, for purposes of calculating such deduction, alimony and separate maintenance payments.

Amends the Employee Retirement Income Security Act of 1974 (ERISA) and the Internal Revenue Code to require pension plans which pay benefits in the form of an annuity to provide a survivor's annuity for the spouse of a participant who dies before the annuity starting date. Specifies that such annuity shall not be less than the payment to which the surviving spouse would be entitled if the participant had died after the annuity starting date. Requires, for the election by a participant not to take a joint and survivor annuity, the written consent of the participant's spouse.

Allows the assignment of pension plan benefits pursuant to a specific court order relating to child support, alimony, or marital property rights.

Lowers from 25 to 21 the minimum age of participation by employees in a pension plan.

Includes approved maternity or paternity leave in the determination of an employee's years of service with an employer, calculated according to a formula which grants 20 hours of service for each week of such leave.