Publications

PBGC Proposed Regulations – Withdrawal Liability
04/04/2008

The Pension Benefit Guaranty Corporation (PBGC) has issued proposed regulations that would make certain modifications to ERISA’s multiemployer pension plan withdrawal liability rules. These new rules could, in some cases, dramatically alter the amount of withdrawal liability that would otherwise be assessed to an employer withdrawing from a multiemployer pension plan. The proposed regulations, which primarily reflect statutory changes made by the Pension Protection Act of 2006 (PPA), address (1) the PPA’s new “fresh start” rule, (2) mandated adjustments to the withdrawal liability calculation for multiemployer plans that are in “critical status,” (3) the PPA’s limited exception that allows an employer to delay making withdrawal liability payments until a final decision is rendered by a court or arbitrator, and (4) the allocation of a plan’s total unfunded vested benefits (UVBs) among employers in a mass withdrawal. The proposed regulations also modify the definition of “multiemployer plan.”


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