The use of the “Segal Blend” to calculate a company’s withdrawal liability when it withdrew from a multiemployer pension plan violated the Employee Retirement Income Security Act (ERISA), as amended by the Multiemployer Pension Plan Amendments Act (MPPAA), because it was not the actuary’s best estimate, the federal appeals court in Cincinnati has held in
Multiemployer
Court Rejects Equitable Exception to MPPAA’s ‘Pay Now, Dispute Later’ Regime
A withdrawing employer must make withdrawal liability installment payments during the pendency of an arbitration proceeding contesting the existence of withdrawal liability, a federal court has affirmed, rejecting the employer’s attempt to recognize an equitable exception to the general “pay now, dispute later” requirement. Boilermaker-Blacksmith National Pension Trust v. PSF Industries, No. 18-2467-JWL (D.…
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…