Withdrawal Liability And Retirement Plans
One of the promises an organization makes to its employees when it offers a retirement plan is that the funds needed to fund their post-work life will be there when they retire. To protect participating employees from experiencing an underfunded account, the Multiemployer Pension Plan Amendments Act was passed in 1980, as an amendment to the Employee Retirement and Income Security Act (ERISA). It requires employers who intend to pull out of defined benefit plans sponsored by several employers to pay a share of the plan’s unfunded vested benefits.
Pitta LLP is a leader in labor law issues. Our attorneys have been representing unions and the trustees and fiduciary agents of retirement plans for more than four decades, and we can guide your union through this complex area of the law.
Why Your Organization Needs To Understand Withdrawal Liability
Retirement benefits are often the largest financial investment most employees will make. If your union has negotiated specific terms related to a defined benefit plan or another type of retirement account, an employer’s withdrawal from the plan may jeopardize both the future security of your members and your organization’s credibility.
Our firm can advise you on many factors related to this topic, including:
- Exemptions that the law provides for the construction, entertainment, trucking and retail food industries
- What actions by an employer do and do not constitute a withdrawal
- How withdrawal liability amounts are calculated and payment plans for employers enacted
- How arbitration is conducted between an employer and a multiemployer plan
As our client, our firm will investigate the exact circumstances of the potential withdrawal and advise you how best to proceed to protect employee benefits.