Insights on benefits counseling and litigation issues impacting employers nationwide
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An employer can contest a withdrawal liability assessment and ultimately prevail. That is the moral of Bulk Transport Corp. v. Teamsters Union No. 142 Pension Fund, No. 23-1563 (7th Cir. Mar. 22, 2024).
Withdrawal liability is a statutory liability imposed on employers whose obligation to contribute to union pension funds (called…
Unionized employers participating in an underfunded multiemployer pension plan face significant financial exposure when withdrawing (completely or partially) from the plan. The cost (called “withdrawal liability”) is generally based on the employer’s pro rata share of the pension plan’s unfunded vested benefits and typically amounts to hundreds of thousands or millions of dollars. This withdrawal…
The SECURE 2.0 Act of 2022 (SECURE 2.0) provides welcome relief to private sector single employer sponsors of defined benefit pension plans (Pension Plan(s)). Effective for plan years beginning on and after January 1, 2024, SECURE 2.0 caps the variable rate premium paid by Pension Plan sponsors to the Pension Benefit Guaranty Corporation (PBGC) at…
Withdrawal liability is a statutory obligation under the Employee Retirement Income Security Act (ERISA) that any unionized employer may have to confront. Exemptions from liability include one applicable to construction industry employers. More…
The recently published final regulation implementing last year’s massive multiemployer pension plan bailout contains a very thin silver lining, but overall, more bad news for already overburdened employers.
Last year, the Pension Benefit Guaranty Corporation (PBGC) issued its interim final rule on the process for eligible troubled Multiemployer Pension Plans (MEPPs) to apply for and…
It’s no secret that the statutory deck under ERISA is stacked heavily in favor of multiemployer pension plans (MEPPs) and against employers contributing to (or withdrawing from) Taft-Hartley trust funds. For example, an employer who receives a demand to pay its alleged allocable share of a multiemployer pension plan’s unfunded vested benefits (Withdrawal Liability) will…
The Multiemployer Pension Plan Amendments Act (MPPAA), the Employee Retirement Income Security Act’s (ERISA) progeny, can create significant unexpected liabilities for companies that have agreed to collective bargaining agreements (CBAs) requiring participation in and contributions to multiemployer-defined benefit pension funds (often referred to as Taft-Hartley Funds). However, a special exemption is available to employers in…
An employer’s permanent cessation of contributions to a multiemployer pension plan can trigger withdrawal liability. This liability may reach affiliated trades or businesses with sufficient common ownership to be under “common control” with the employer. The affiliates would be jointly and severally liable for withdrawal liability incurred and unpaid by the withdrawing affiliate.
Courts often…
In the clamor that surrounded the current administration’s adoption of the American Rescue Act of 2021 (ARPA), quietly tucked in as Subtitle H is the Butch Lewis Emergency Pension Plan Relief Act of 2021 (Butch Lewis). Butch Lewis has been unsuccessfully bouncing around Congress since 2019. While Butch Lewis is long on rhetoric, at this…
