Employers that completely or partially withdraw from underfunded multiemployer pension funds are well aware that they may owe the fund withdrawal liability—an assessment against the employer of its allocable share of the fund’s underfunding, provided under ERISA. Imagine an employer that finds out its withdrawal liability is reduced to zero under the “de minimis reduction,” …
Buyers Beware: Sixth Circuit Holds That Asset Purchaser Can Be Sued for Predecessor’s Unpaid Pension Liability
In a typical asset sale transaction, the purchaser takes great care to disclaim any responsibility for the seller’s business debts. When the seller is a sponsor of a defined benefit pension plan, this typically includes a disclaimer for any pension liability (e.g., unpaid plan contributions, PBGC premiums, and liability upon plan termination). The purchaser will …
The PBGC’s Missing Participant Program Now Allows Terminating Defined Contribution Plans to Participate
Especially upon plan termination, locating missing participants can be a major headache for plan sponsors, who have a fiduciary obligation to locate participants and distribute benefits under the terminating plan. In one development that may help in this regard, the Pension Benefit Guaranty Corporation (“PBGC”) issued final regulations that expand, revise and simplify its Missing …