Archives: Multiemployer Pension Plans

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January 20, 2017; A Historical Day

This is another article in our series addressing the continued deterioration and downward spiral of multi-employer defined benefit pension funds and the resulting impact upon participants, unions and most importantly on employers. As the American public focuses on January 20, 2017 as the beginning of the Trump administration, the day may also have historical significance … Continue Reading

Pension Plan Suffers Cybersecurity Attack, ERISA Advisory Council Offers Cybersecurity Recommendations to DOL

It has been reported that infamous bank robber, Slick Willie Sutton, once said, “I rob banks because that’s where the money is.” Data thieves, understandably, have a similar strategy – go where the data is. The retail industry knows this as it has been a popular target for payment card data. The healthcare and certain … Continue Reading

Crash Landing for Central States – What now for Multi-employer Pension Funds?

In the aftermath of the rejection of the Central States Southeast and Southwest Areas Pension Plan (“Central States”) application to reduce core benefits by Treasury Special Master Kenneth Feinberg, it is critical that contributing employers to multi-employer pension funds recognize the harsh reality that help to those funds will not be forthcoming from the government in … Continue Reading

Tenth Circuit Expands Withdrawal Liability of Construction Industry Employer

In a case of first impression, the United States Circuit Court of Appeals for the Tenth Circuit held that work performed by a non-union company acquired after a construction industry employer ceased contributing to a multiemployer pension plan (MEP) triggered withdrawal liability.  The case, Ceco Concrete Construction, LLC v. Centennial State Carpenters Pension Trust, Nos. … Continue Reading

“High Noon” for the Central States Pension Fund?

For the past several months, we have been reporting on the application filed by the Central States Southeast and Southwest Areas Pension Fund  (“Central States”) to the Department of Treasury to reduce “core” benefits to participants.    This extraordinary remedy is permitted by the  Kline-Miller Multiemployer Pension Reform Act of 2014 (“Kline-Miller Act”). Public hearings conducted … Continue Reading

The Continuing Downward Spiral of the Multi-Employer Pension Plan

We have been monitoring and reporting on several disquieting events which have occurred in the multi-employer pension plan world within the past few months. In September 2015, the Central States Southeast and Southwest Area Pension Fund availed itself of the relief permitted under the Kline-Miller Multiemployer Pension Reform Act of 2014 (“Kline-Miller Act”) by applying … Continue Reading

Multiemployer Pension Plan Lowers Threshold That Triggers Partial Withdrawal Liability Payments

The United Food and Commercial Workers International Union (“UFCW”) National Pension Fund (which, according to its website has over 500 contributing employers and over 100,000 active participants) has adopted a new rule effective as of the plan year ending on June 30, 2014 which increases the risk that a participating employer will unknowingly create a … Continue Reading

“The Beat Goes On!” Third Multi-Employer Pension Plan Seeks to Reduce Core Benefits

The third multi-employer pension plan since September 2015 has filed an application with the Department of the Treasury in which it is seeking to reduce core benefits under the Multiemployer Pension Reform Act of 2014 (“MPRA”). The Teamsters Local 469 Pension Plan (“469 Fund”) which is administered in Hazlet, New Jersey has now joined the … Continue Reading

Second Multiemployer Pension Plan Seeks to Reduce Core Benefits

On October 28, 2015, we reported that the Central States Southeast and Southwest Area Pension Fund (“Central States”) — one of the largest multiemployer pension plans in the country — had filed an application with the Department of the Treasury (“Treasury”) seeking to reduce core benefits under the Multiemployer Pension Reform Act of 2014 (“MPRA”) and had sent … Continue Reading

Application by Central States Pension Fund to Reduce Core Benefits

Since the passage of the Multiemployer Pension Plan Amendments Act of 1980 (“MPPAA”) the financial well-being of employers contributing to multi-employer defined benefit pension plans has been tied to the funding of those plans, many of which have been underfunded for decades. The downward spiral has been exacerbated by several unalterable factors: an increase in … Continue Reading

Asset Purchasers Face Increased Exposure for the Multiemployer Pension Debts of Sellers

Both buyers and sellers in asset sale transactions should be cognizant of the ongoing erosion of the common law rule that the purchaser is not responsible for the seller’s liabilities absent a contractual assumption of such liabilities, as evidenced by a recent Ninth Circuit case finding that the theory of successor liability may be used … Continue Reading

New Regulatory Guidance Issued on Plan Benefit Suspensions and Plan Partitions for Multiemployer Pension Plans at Risk of Insolvency

As part of on-going efforts to prevent the collapse of financially troubled multiemployer pension plans, the Pension Benefit Guaranty Corporation (“PBGC”) and Internal Revenue Service (“IRS”) have issued regulatory guidance under the Multiemployer Pension Reform Act of 2014 (“MPRA”). Together, the Treasury Proposed and Temporary Regulations, a new Revenue Ruling, and PBGC interim rule prescribe … Continue Reading

MULTIEMPLOYER BENEFIT PLANS — REDUCING AN EMPLOYER’S EXPOSURES

Employers with collectively bargained employees need to be aware that the costs of participating in a union sponsored benefit fund (i.e., a multiemployer plan) may be much greater than the negotiated contributions. The greatest exposure commonly comes from withdrawal liability — generally an employer’s pro rata share of a multiemployer pension plan’s unfunded vested benefits … Continue Reading

FASB Draft Would Require Additional Financial Statement Disclosure of Liabilities of Multiemployer Plans

The Financial Accounting Standards Board ("FASB") issued an Exposure Draft (the "Draft") September 1, 2010, proposing changes to U.S. Generally Accepted Accounting Principles ("GAAP"), which, if adopted, would require participating employers in multiemployer pension plans to disclose in their financial statements additional information concerning their obligations to such plans. The Draft would apply to public companies for fiscal years ending after December 15, 2010 and to non-public companies exactly one year later.… Continue Reading

Dealing with 100% Excise Tax on Late Employer Contributions to Underfunded Multiemployer Plans Face 100% Excise Tax

The Pension Protection Act of 2006 (“PPA”) created certain funding classifications for multiemployer pension plans. Seriously underfunded plans are classified as either “critical” (“red zone”) or endangered (“yellow zone”). Plans that fall in between these two levels are considered “seriously endangered” (“orange zone”) plans. Such plans must send participating employers a notice about the plan’s … Continue Reading
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