This is another blog on our monitoring the status of defined benefit multi-employer pension funds. Since this author last wrote to you, it has been revealed that the Central States Pension Fund is scheduled to become insolvent sometime in 2025. Worse yet, it has been announced that the multi-employer fund of the Pension Benefit … Continue Reading
As our earlier article reported, Judge Robert W. Sweet of the U.S. District Court for the Southern District of New York had recently held that a multiemployer pension fund’s use of the “Segal Blend” to calculate a withdrawn employer’s withdrawal liability violated the provisions of the Employee Retirement Income Security Act (“ERISA”), as amended by … Continue Reading
Under the Employee Retirement Income Security Act (“ERISA”), as amended by the Multiemployer Pension Plan Amendments Act (“MPPAA”), an employer that has assumed an obligation to contribute to collectively-bargained and jointly-administered defined benefit pension plans ( “multiemployer plans”) is liable for its allocable share of any underfunding upon the permanent cessation of that obligation. This … Continue Reading
This is the most recent article in our series which focuses on the impact on employers of the downward spiral and death knell of the multi-employer defined benefit plan. The Eleventh Circuit has dealt another blow to employers who contribute to multi-employer defined benefit funds. In Westrock RKT Company v. Pace Industry Union-Management Pension Fund … Continue Reading
This is another article in our series which has focused on the deterioration and downward spiral of the multi-employer defined benefit pension fund. Death Notice Decedent: The New York Teamsters Road Carriers Local 707 Pension Fund Date of Death: March 2017 Cause of Death: The failure of successive administrations and Congresses to address the serious underfunding … Continue Reading
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
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
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
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
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
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
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 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
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
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
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
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
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
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
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
