Headlines about "Multiemployer plans"
Gathered from the web by the editors at BenefitsLink.com.
GASB Issues Guidance on Multi-Employer OPEB Plans
Excerpt: "The Governmental Accounting Standards Board (GASB) has issued an exposure draft of a proposed statement that addresses issues related to the use of the alternative measurement method and the frequency and timing of measurements by employers that participate in agent multiple-employer other postemployment benefit (OPEB) plans. The proposed Statement would amend paragraphs 33 - 35 of Statement No. 45, Accounting and Financial Reporting by Employers for Postemployment Benefits Other Than Pensions, to permit an agent employer that has an individual-employer OPEB plan with fewer than 100 total plan members to use the alternative measurement method, at its option, regardless of the number of total plan members in the agent multiple-employer OPEB plan in which it participates." (PLANSPONSOR.com; free registration required)
Results from Survey of Calendar-Year Plans' 2009 Zone Status and Freeze Elections, Spring 2009 (PDF)
4 pages. Excerpt: "The market downturn has had a dramatic impact on the zone status of multiemployer pension plans. The [survey] found that, compared to one year earlier, many more plans are now in the red zone and the yellow zone while the number of plans in the green zone has dropped precipitously. In addition, the survey found that the average PPA'06 funded percentage for calendar-year plans declined. The survey also reports the number of calendar-year plans that elected to freeze their zone status, as allowed by the Worker, Retiree and Employer Recovery Act of 2008." (The Segal Group, Inc.)
Cautions To Employers Considering a Multiemployer Plan
Excerpt: "Are you a small employer that has been faced with the possibility of participating in a multiemployer plan for your union employees? If so, before you sign up, you should carefully consider the pros and cons (especially cons!) of such a plan." (Chang, Ruthenberg & Long)
[Guidance Overview] Office of Labor Management Standards Extends Comment Period for Proposed Regulations on LM-2 and LM-3 Forms
Excerpt: "The regulations were issued on April 21, 2009 and orginally, the comment period was scheduled to end on May 21, 2009. The new deadline is June 22, 2009. The notice of proposed rulemaking proposes to withdraw a rule published in the Federal Register on January 21, 2009, pertaining to the filing by labor organizations of the Form LM-2, an annual financial report required by the Labor-Management Reporting and Disclosure Act of 1959, as amended (LMRDA)." (International Foundation of Employee Benefit Plans)
[Guidance Overview] IRS Provision of WRERA Funding Relief Election Procedures (PDF)
5 pages. Excerpt: "These developments affect sponsors of and participants in qualified multiemployer defined benefit plans. They do not affect single-employer plans, multiple employer plans, governmental plans or church plans that do not elect to be covered by ERISA ('non-electing church plans'). . . . On December 23, 2008, President Bush signed into law the Worker, Retiree, and Employer Recovery Act of 2008 (WRERA). In response to the current economic crisis, WRERA provides welcome funding relief for multiemployer plans. For plan years beginning on or after October 1, 2008, and before October 1, 2009, WRERA allows plans to temporarily freeze their funding status based on the prior year's actuarial certification. In addition, the sponsor of a multiemployer plan may elect for a plan year beginning in 2008 or 2009 to extend the plan's applicable funding improvement plan or rehabilitation plan by three years.The IRS recently issued Notice 2009-31 to provide guidance relating to the elections offered under WRERA." (Prudential Retirement)
[Official Guidance] Text of 'IRS Retirement News for Employers' -- Spring 2009 Edition (PDF)
14 pages. Excerpt: "The EP Team Audit (Large Case Program) web pages have been updated to include: EPTA Trends and Tips (now organized according to plan type): Common Trends Across All Plan Types; Multiemployer Plan Trends; 401(k) Plan Trends; Defined Benefit Plan Trends; 403(b) Tax-Sheltered Annuity Plan, 457 Plan and Governmental Plan Trends; 'EPTA Trends and Tips' includes links to videos on the EPTA program and on finding, fixing and avoiding plan errors; Internal Controls Questionnaire - Examples of questions asked by EP examiners to understand the system procedures and internal controls; Taxpayer Documentation Guide - This guide, developed by EPTA agents and outside practitioners, provides a comprehensive list of documents that need to be made available for examination." (Internal Revenue Service)
[Guidance Overview] Extension of Election Date for Sponsors of Multiemployer Defined Benefit Plans That Are Significantly Underfunded
Excerpt: "Because some sponsors of multiemployer plans have identified a legitimate need for additional time to make these elections in particular situations, the IRS has extended the applicable date from April 30, 2009 to June 30, 2009. In addition, if: (1) as of the otherwise applicable deadline (i.e., the deadline for a plan as modified) for making an election under section 204 or 205, a plan sponsor has been unable to reach agreement as to whether to make the election, so that the decision must be resolved through an arbitration process; (2) the plan sponsor makes an election by the otherwise applicable deadline that is contingent on the resolution of the arbitration; and (3) the resolution is to not make an election, then the IRS will automatically approve a request to revoke the election." (Wolters Kluwer)
[Official Guidance] IRS Gives Multiemployer Plans More Time to Freeze their Funding Status
Excerpt: "Responding to requests from plan sponsors for more time to decide whether to freeze their multiemployer plan's funding status under IRC ? 432, the Internal Revenue Service extended the election deadline from April 30 to June 30. Moreover, where the decision requires arbitration, the IRS will accept a timely contingent election that can be revoked later if the arbitration results in a decision not to freeze." (Deloitte via BenefitsLink.com)
Funding Status of Many Multiemployer Plans Hurt by Investment Losses in 2008
Excerpt: "In 2008, 80.2% of 237 multiemployer defined benefit plans were at least 80% funded (in safe status); while 11.0% were 65%-80% funded (in endangered status) and 8.9% were less than 65% funded (in critical status). For 2009, funded status decreased significantly: 20.7% were in safe status; 41.4% were in endangered status; and 37.9% were in critical status." (Wolters Kluwer)
[Guidance Overview] IRS Deadline Extension for WRERA Zone Status Freeze
Excerpt: "On April 30, 2009, the Internal Revenue Service (IRS) released Notice 2009-42,1 extending the deadline for certain multiemployer plans to make elections under Sections 204 and 205 of the Worker, Retiree, and Employer Recovery Act of 2008 (WRERA). . . . Under the new guidance: The deadline for a zone freeze election under WRERA ?204 is now the later of June 30, 2009 (instead of April 30, 20094) and the date that is 30 days after the due date of the annual certification of endangered or critical status for the election year. The earliest date by which an election for a correction period extension under WRERA ?205 is required to be made is now June 30, 2009." (The Segal Group, Inc.)
[Official Guidance] Text of IRS Notice 2009-42: April 30 Deadline Extended to June 30 for Multiemployer Plans to Elect Relief under Sections 204 and 205 of WRERA (PDF)
2 pages. Excerpt: "Some sponsors of multiemployer plans have identified a legitimate need for additional time to make these elections in particular situations. Accordingly, this Notice hereby substitutes 'June 30, 2009' for each reference to 'April 30, 2009' in . . . Notice 2009-31. In addition, if (1) as of the otherwise applicable deadline (i.e., the deadline for a plan as modified by this notice) for making an election under section 204 or 205, a plan sponsor has been unable to reach agreement as to whether to make the election, so that the decision must be resolved through an arbitration process; (2) the plan sponsor makes an election by the otherwise applicable deadline that is contingent on the resolution of the arbitration; and (3) the resolution is to not make an election, then the IRS will automatically approve a request to revoke the election." (Internal Revenue Service)
Number of Endangered Multiemployer Plans Quadrupled in Last Year
Excerpt: "A new survey from the International Foundation of Employee Benefit Plans (IFEBP) shows that the number of multiemployer pension plans less than 80% funded has quadrupled in the last year. In 2008, 80% of multiemployer DB plans were certified as safe (in the green zone), while only 11% were endangered or seriously endangered (the yellow or orange zone), and 9% were critical (the red zone). For survey respondents who have calculated their plan status in 2009, only 20% remain in the safe zone, and the majority of plans were either endangered or seriously endangered (41%) or critical (38%), according to an IFEBP announcement." (PLANSPONSOR.com; free registration required)
[Guidance Overview] A Periodic Snapshot of What's Happening in the Multiemployer Health Plan Environment (PDF)
1 page. Excerpt: "This report: Provides information about recent developments in health care and the multiemployer marketplace. Presents data including consumer price index (CPI) and Segal health trends. Provides context for what's happening to health plans." (The Segal Group, Inc.)
[Guidance Overview] Office of Labor Management Standards Delays and Withdraws Regulations on LM-2 and LM-3 Forms
Excerpt: "The Department of Labor's Office of Labor Management Standards (OLMS) delays the effective date and proposes to withdraw new rules on LM2/LM3 financial disclosure forms. Comments on the proposed rule must be received on or before May 21, 2009." (International Foundation of Employee Benefit Plans)
[Guidance Overview] Multiemployer Pension Plan Funding Relief: Action Needed by April 30
Excerpt: "The relief applies to plan years beginning on or after October 1, 2008, and not later than September 30, 2009; for calendar year plans, elections must be made by April 30, 2009." (McDermott Will & Emery)
[Guidance Overview] Collective Bargaining Agreements Can Prevent Employers from Reducing or Terminating Retiree Medical Benefits
Excerpt: "While we recognize that the negotiation of collective bargaining agreements is an art in and of itself, this decision should remind employers that the text of such an agreement can bind them to employee benefit obligations they may never have intended, for many years into the future. In the Sixth Circuit, at least, precise text appears to be required to specify that retiree medical benefits are not vested, to sever retiree medical benefit eligibility from pension benefit eligibility, to preserve the right to reduce or eliminate employer contributions, and to preserve the right to amend or terminate the retiree medical plan." (Porter Wright Morris & Arthur LLP)
More Taft-Hartley Funds Sue Over Madoff Losses
Excerpt: "Two more civil complaints, both seeking class-action status, have been filed in U.S. District Court in New York against Austin Capital Management in connection with losses from the firm's investment in a hedge fund that was involved in the Madoff Ponzi scheme. The most recent suit was filed April 8 on behalf of two Las Vegas Taft-Hartley retirement plans: the $335 million Construction Industry and Laborers Joint Pension Trust/Laborers Union Local 872, and the $138 million Plumbers and Pipefitters Union Local 525." (Pensions & Investments)
[Guidance Overview] Guidance on Notice and Election Procedures for Significantly Underfunded Multiemployer Plans
Excerpt: "The guidance also contains information on special notice requirements for plans in neither endangered nor critical status as a result of a freeze election. In addition, the IRS describes the effect of a WRERA election on Form 5500, Schedule MB, and Schedule R filings." (Wolters Kluwer)
[Guidance Overview] Public Sector Retirement Plan Compliance Wrap-up (PDF)
Excerpt: "This Bulletin discusses the following major public sector provisions of [The Worker, Retiree and Employer Recovery Act of 2008 (WRERA)]: Rate of Return for Crediting Interest, Rollovers, Temporary Waiver of Required Minimum Distributions, and Self-Funded Plans Eligible for Special Tax Exclusion for Retired Public Safety Officers under PPA'06. This Bulletin also provides information about extensions by the Internal Revenue Service (IRS) of several important compliance deadlines for public sector retirement plans." (The Segal Group, Inc.)
[Guidance Overview] IRS's Guidance on Multiemployer Pension Plan Funding Relief
Excerpt: "The IRS has provided guidance for sponsors of multiemployer defined benefit plans relating to the funding relief provided by the Worker, Retiree, and Employer Recovery Act of 2008 (WRERA), and corresponding notice requirements. Section 204(a) of WRERA provides that a multiemployer plan sponsor may elect to temporarily freeze the plan's funding status (critical, endangered, or neither) so that it is the same as the plan's status for the plan year immediately prior to the election year. Specifically, section 204(a)(1) of WRERA provides that a multiemployer plan sponsor may elect that the plan's funding status for the first plan year beginning on or after October 1, 2008 and not later than September 30, 2009 be the same as the plan's status for the prior year." (PLANSPONSOR.com; free registration required)
[Official Guidance] Text of IRS Notice 2009-31: Election and Notice Procedures for Multiemployer Plans under Sections 204 and 205 of WRERA (PDF)
Excerpt: "WRERA provides that a multiemployer plan sponsor may elect, notwithstanding the actuarial certification of the plan's section 432 status . . . for the plan year for which the election is made[,] . . . to temporarily freeze the plan's section 432 status so that it is the same as the plan's section 432 status for the plan year immediately prior to the election year . . . . Section 204(c)(2) of WRERA provides special notice rules that apply when an election . . . is made to freeze a plan's section 432 status and that modify the otherwise applicable notice requirements under section 432(b)(3)(D) of the Code." (Internal Revenue Service)
[Guidance Overview] Office of Labor-Management Standards' Intended Rulemaking to Revise Form LM-30 (Labor Organization Officer and Employee Report)
Excerpt: "The Office of Labor-Management Standards (OLMS) has announced that it will publish in the spring 2009 Semi-Annual Regulatory Agenda notice of an intended rulemaking to revise the Form LM-30 (Labor Organization Officer and Employee Report). The rulemaking is intended to review questions of policy and law surrounding these reporting requirements. The rulemaking will focus on the changes resulting from a 2007 regulatory revision of the Form and instructions." (International Foundation of Employee Benefit Plans)
[Guidance Overview] IRS Revises Employer Quarterly Federal Tax Reporting Form, But Does Not Yet Address Multiemployer Plan Reimbursement for COBRA Subsidy
Excerpt: "The Internal Revenue Service (IRS) has revised this year's Form 941, which is used for an employer's quarterly federal tax return, to reflect the new temporary program to provide a subsidy for premiums payments for continued health coverage under the Consolidated Omnibus Budget Reconciliation Act (COBRA). . . . The instructions for Form 941 have also been updated." (The Segal Group, Inc.)
[Guidance Overview] Defined Benefit Pension Plan Annual Funding Notices ? DOL Field Assistance Bulletin 2009-1 (PDF)
2 pages. Excerpt: "Model notices for single and multiemployer plans are provided in the appendices to FAB 2009-1. Although not mandatory, the models, if properly completed, will satisfy the content requirements. The annual funding notice may be given electronically, provided that the notice is reasonably accessible to participants, beneficiaries and other required recipients." (Kelly, Hannaford & Battles P.A.)
Winter 2009 Report of Results from the 2008 Survey of Withdrawal Liability Funded Ratios (PDF)
4 pages. Excerpt: "The Segal Company's 2008 Survey of Withdrawal Liability Funded Ratios found: The average withdrawal liability funded ratio of multiemployer pension plans was unchanged from the prior year's survey: 84 percent. This finding is not surprising given that the 2008 survey is based on data from before the economic downturn." (The Segal Group, Inc.)
Pendency of Request for Approval of Special Withdrawal Liability Rules; Service Employees International Union Local 1 Pension Trust Fund
Excerpt: "The Pension Benefit Guaranty Corporation ('PBGC') has received a request from the Service Employees International Union Local 1 Pension Trust Fund for approval of a plan amendment providing for special withdrawal liability rules. Under section 4203(f) of the Employee Retirement Income Security Act of 1974 and the PBGC's regulation on Extension of Special Withdrawal Liability Rules, a multiemployer pension plan may, with PBGC approval, be amended to provide for special withdrawal liability rules similar to those that apply to the construction and entertainment industries. Such approval is granted only if the PBGC determines that the plan amendment will be used in an industry with characteristics that would make use of the special rules appropriate and that the plan amendment would not pose a significant risk to the PBGC. This notice advises interested persons of the pendency of this request and invites public comment." (FIND, Inc. via COMTEX via Technology Marketing Corp.)
VEBA Not Resolved in Tentative UAW Deals
Excerpt: "Although the UAW said Tuesday that it has reached tentative deals with each of the Detroit Three to modify its 2007 labor contract, the union acknowledged that the largest, and most contentious, issue remains. The tentative deal does not include an agreement on how to fund a critical health care trust -- commonly called a VEBA -- and no deal will be final until that gets worked out." (Detroit Free Press)
UAW Yields to Market: Wage Reductions, Job Cuts and Loss of Benefits Among Likely Recovery Concessions
Excerpt: "The United Auto Workers, which once set the standard for organized labor for wages and job protection, said yesterday that it is making concessions as part of the recovery plans submitted by General Motors and Chrysler. The plans are expected to accelerate wage reductions, job cuts and loss of benefits, changes already spurred by foreign competition, declining sales and the worst economic conditions since the Great Depression." (The Washington Post; free registration required)
[Guidance Overview] Solving a Multiemployer Pension Plan's PPA Issues
Excerpt: "The Pension Protection Act of 2006 (PPA) requires that multiemployer defined benefit pension plans arrange and report annual actuarial certification of their plans' funded status to the IRS within three months of the end of each plan year. Plans that are currently at least 80% funded and projected to meet minimum funding requirements for the next seven years are certified as healthy plans ('green' zone)." (Milliman)
Fear of Union Litigation Gives Whirlpool Standing in Retiree Benefit Suit
Excerpt: "The U.S. District Court for the Southern District of Iowa has denied a motion to dismiss Whirlpool's lawsuit seeking the right to modify retiree medical benefits set forth in a now-expired collective bargaining agreement. U.S. District Court Judge James E. Gritzner pointed out in his opinion that 'In the absence of an alleged actual injury, a plaintiff seeking a declaratory judgment must show that 'it is in immediate danger of sustaining threatened injury traceable to an action of [the defendant],' and in the present case the potential injury is litigation. Gritzner agreed with the company that it had a reasonable uncertainty that it could modify retirees' benefits without the affected parties suing based on the local chapter of the International Union, United Automobile, Aerospace, and Agricultural Implement Workers' (UAW) refusal to bargain and UAW's frequent litigation in cases with identical facts." (PLANSPONSOR.com; free registration required)
Retiree Benefit Cutbacks Roil Courts: Circuits Split on Benefit Promises
Excerpt: "A bad economy, aging workers and long-ago company promises of lifetime health benefits for retirees have combined to produce a spate of conflicting federal appellate standards as companies try to cut back those benefits. In a dozen cases, the 6th U.S. Circuit Court of Appeals, based in the heavily unionized Rust Belt, has embraced broad acceptance of the premise that retiree benefit rights vest if evidence is bolstered by evidence outside the contract. The 7th Circuit is tougher. It generally assumes that benefit promises expire with the labor contract. And the 3d and 4th circuits take an even harder line, requiring retirees to show a 'clear and express' contract statement that benefits vest. 'It's a mess,' said James P. Baker, co-chairman of the Jones Day employee benefits practice in the firm's San Francisco office." (The National Law Journal)
UAW Retiree Health Care Looms as Obstacle in Bailout Talks
Excerpt: "UAW Retiree Health Care Looms as Obstacle in Bailout Talks Health care for UAW retirees is looming as a major controversy in crucial bailout negotiations at General Motors. The United Auto Workers won't accept further concessions on retiree health care costs unless GM creditors make substantial sacrifices to reduce the automaker's crushing debt burden, said a source familiar with the union's position. Only six days remain until GM and Chrysler file viability plans with the federal government. Those plans are supposed to include major cost-cutting sacrifices by all stakeholders." (Workforce Management; free registration required)
DOL Multiemployer Plan Model Funding Notice (PDF)
5 pages. (U.S. Department of Labor via American Benefits Council)
[Guidance Overview] New PBGC Regulation Offering Multiemployer Plans Additional Options for Withdrawal Liability (PDF)
4 pages. Excerpt: "The PBGC has published a final regulation that implements changes made by the Pension Protection Act of 2006 (PPA) in withdrawal liability calculations. The new regulation also offers additional options to plans and changes the method of allocating liability following a mass withdrawal." (Cheiron, Inc.)
[Guidance Overview] IRS's Multiemployer Plan Amortization Extension Procedures (PDF)
3 pages. Excerpt: "On November 12, 2008, the IRS issued Revenue Procedure 2008-67 to provide guidance for sponsors of multiemployer plans that want to obtain IRS approval of an amortization period extension under the rules as revised by the Pension Protection Act of 2006 (PPA). Under PPA, an amortization extension can be used to keep a plan out of 'endangered' status but cannot be used to keep a plan out of 'critical' status. The submission and notification rules described in this revenue procedure apply to all amortization period extensions requested for plan years beginning after December 31, 2007." (Prudential Retirement)
[Guidance Overview] Multiemployer Defined Benefit Plans in a Time of Crisis: Keeping a Long-Term Perspective (PDF)
6 pages. Excerpt: "The following are among the issues related to the content of this NewsLetter that Trustees should consider: Weighing the advantages and disadvantages of the relief options available in the Worker, Retiree and Employer Recovery Act of 2008, Revisiting the actuarial asset valuation methodology used, Evaluating the effect of potential plan design changes, Assessing the employment outlook, Creating pension funding parameters for plans that are fortunate enough to be in the green zone, Performing deterministic or stochastic projections, and Preparing 'crisis' communications to educate participants about their plan." (The Segal Group, Inc.)
[Guidance Overview] IRS Guidance and Special Options for EGTRRA Determination Letter Cycle D Plans (PDF)
2 pages. Excerpt: "Each year, the IRS publishes a 'Cumulative List of Changes in Plan Qualification Requirements' that must be reflected in the individually-designed plan documents submitted for determination letters in the filing cycle beginning on the next February 1. The 2008 Cumulative List applies to plans submitted in Filing Cycle D. Single employer plans sponsored by employers with employer identification numbers (EINs) ending in 4 or 9 and multiemployer plans must file requests for Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA) determination letters in Cycle D. The Cycle D submission period opens on February 1, 2009, and will close on January 31, 2010. In addition to listing the provisions that must be reflected in Cycle D plan documents, the 2008 Cumulative List provides some special options for Cycle D plans." (Prudential Retirement)
[Guidance Overview] Sixth Circuit Refuses To Vest Health Care Benefits Before Active Union Workers Actually Retire (PDF)
Excerpt: "In a rare retiree benefits decision favorable to employers, the Sixth Circuit refused yesterday to find that a long-expired labor contract (CBA) between Caterpillar Inc. and the United Automobile Workers of America ('UAW') vested (i.e., guaranteed) lifetime retiree health care benefits for active workers when they became eligible for pensions and years before they actually retired. Winnett v. Caterpillar Inc., 2009 WL 170598 (6th Cir. 2009)." (Seyfarth Shaw LLP via American Benefits Council)
Sixth Circuit Refuses To Vest Health Care Benefits Before Active Union Workers Actually Retire
Excerpt: "In a rare retiree benefits decision favorable to employers, the Sixth Circuit refused yesterday to find that a long-expired labor contract (CBA) between Caterpillar Inc. and the United Automobile Workers of America ('UAW') vested (i.e., guaranteed) lifetime retiree health care benefits for active workers when they became eligible for pensions and years before they actually retired. Winnett v. Caterpillar Inc., 2009 WL 170598 (6th Cir. 2009)." (Seyfarth Shaw LLP)
[Official Guidance] DOL Advisory Opinion 2009-01A on Use of Certain Bank Collective Investment Funds
Excerpt: "This is in response to your request for an advisory opinion on behalf of AmeriServ Trust and Financial Services Company (ATFSC) concerning the application of section 408(b)(4) of the Employee Retirement Income Security Act of 1974, as amended (ERISA), and the parallel provisions under section 4975(d)(4) of the Internal Revenue Code of 1986, as amended (the Code),(1) to the use of deposit accounts of its banking affiliate for investment of cash of certain bank collective investment funds for which it serves as trustee, under the circumstances as described herein." (U.S. Employee Benefits Security Administration)
[Guidance Overview] Segal's Multiemployer Health Plans 1st Quarter 2009 TRENDS Report (PDF)
1 page. Excerpt: "This report includes recent developments in health care and the multiemployer marketplace and data including consumer price index (CPI) and Segal health trends." (The Segal Group, Inc.)
[Guidance Overview] Milliman's Monthly Benefits News and Developments. Jan. 2009 Edition (PDF)
2 page list of principal employee benefits news and developments in December, 2008. (Milliman)
[Guidance Overview] PBGC's Final Regs on Reallocation Liability Upon Mass Withdrawal
Excerpt: "The Pension Benefit Guaranty Corporation (PBGC) has issued final regulations implementing provisions of the Pension Protection Act of 2006 (P.L. 109-280; PPA) to change the allocation of unfunded vested benefits to withdrawing employers from a multiemployer pension plan and make adjustments in determining an employer's withdrawal liability when a multiemployer plan is in critical status. The final regulations are substantially the same as proposed rules issued in March 2008." (Wolters Kluwer)
DOL Recovers $750M for Georgia Plumbers Health Plan
Excerpt: "The U.S. Department of Labor (DoL) has obtained consent judgments restoring an additional $250,000 to the Georgia Plumbers Trade Association Health Plan in Griffin, Georgia, and requiring the payment of a $50,000 civil penalty to the federal government." (PLANSPONSOR.com; free registration required)
[Guidance Overview] Massachusetts Minimum Creditable Coverage Certification
Excerpt: "Important guidance concerning Massachusetts Health Care Reform was released on November 25, 2008. This guidance sets out how a group health plan that does not meet the Massachusetts minimum creditable coverage (MCC standards) may be 'deemed' to comply with these requirements through 'MCC certification.' The guidance also explains the application process for collectively bargained plans that wish to apply for an extension of time to comply with the MCC rules." (The Segal Group, Inc.)
[Guidance Overview] Following Precedent, 6th Circuit Rules CBA Covering a 3-Year Period Creates a Permanent Obligation for Retiree Health Benefits (PDF)
At p. 4 of 8. Excerpt: "Following its decision in Noe v. Polyone Corp., 520 F.3d 548 (6th Cir. 2008) . . ., the Sixth Circuit in Cole v. ArvinMeritor, Inc., 2008 WL 5211802 (6th Cir. Dec. 16, 2008), held that retirees had vested in their retiree health benefits because the applicable collective bargaining agreements ('CBAs') did not contain language that expressly limited the duration of the company's commitment to provide health benefits to its retirees." (Proskauer Rose LLP)
UAW Will Seek Worker Approval for Contract Changes
Excerpt: "UAW president Ron Gettelfinger said Tuesday, January 6, that the union would seek rank-and-file approval for any changes it makes to labor agreements to help the Detroit Three comply with provisions of the federal bailout. The UAW's bargaining team from the General Motors department was scheduled to begin discussing their negotiating strategies Tuesday, Gettelfinger said in an interview with Automotive News. The union's bargaining teams from Ford Motor Co. and Chrysler will begin meeting later this week, he said." (Workforce Management; free registration required)
[Guidance Overview] Temporary Funding Relief for Multiemployer Plans (PDF)
2 pages. (Milliman)
[Official Guidance] Text of Final ERISA Regs on Civil Penalties Under Pension Protection Act of 2006 (PDF)
5 pages. Excerpt: "The regulation is necessary to reflect recent amendments to section 502(c)(4) by the Pension Protection Act of 2006, under which the Secretary of Labor is granted authority to assess civil penalties not to exceed $1,000 per day for each violation of section 101(j), (k), or (l), or section 514(e)(3) of ERISA. . . . [T]he PPA amended . . . ERISA by adding a new disclosure requirement . . . under which the plan administrator of a single-employer defined benefit pension plan must provide written notice of limitations on benefits and benefit accruals to participants and beneficiaries . . . . A notice of benefit limitations must be furnished within 30 days after a plan becomes subject to an ERISA section 206(g) funding-based restriction . . . . [PPA made other amendments that are subject to the new rules, as described herein.]" (Employee Benefits Security Administration, U.S. Department of Labor)
[Guidance Overview] Overview of the Worker, Retiree and Employer Recovery Act of 2008
Excerpt: "Emergency Funding Relief For Defined Benefit Plans . . . Technical Modifications to the PPA . . . Non-Technical Retirement Security Provisions . . . Mental Health Parity and Addiction Equity Act For Collectively Bargained Plans . . . ." (McGuireWoods)
[Official Guidance] PBGC Final Regs: Allocation of Unfunded Vested Benefits to Withdrawing Employers from a Multiemployer Pension Plan (PDF)
10 pages. Excerpt: "This final rule . . . [implements] provisions of the Pension Protection Act of 2006 that provide for changes in the allocation of unfunded vested benefits to withdrawing employers from a multiemployer pension plan, and that require adjustments in determining an employer's withdrawal liability when a multiemployer plan is in critical status. . . . [It] also amends this regulation to provide additional modifications to the statutory methods for determining an employer's allocable share of unfunded vested benefits [and] amends PBGC's regulation on Notice, Collection, and Redetermination of Withdrawal Liability (29 CFR part 4219) to improve the process of fully allocating a plan's total unfunded vested benefits among all liable employers in a mass withdrawal. Finally, this final rule amends [PBGC regulations To reflect the definition of a 'multiemployer plan' added by [PPA 2006]." (Pension Benefit Guaranty Corporation)
[Guidance Overview] Technical Correction Clarification of Mental Health Parity Effective Date for Plans Maintained Under Collective Bargaining Agreements
Excerpt: "The original legislation included an ambiguous provision that could have been interpreted to require some collectively bargained plans to comply with the expanded mental health parity provisions on January 1, 2009 -- even before the effective date for non-collectively bargained plans. This technical correction clears up confusion by providing that the earliest compliance date for plans maintained pursuant to a collective bargaining agreement is January 1, 2010. (Of course, such plans may have a later effective date based on the termination of the longest-running collective bargaining agreement under which the group health plan is maintained.)" (Employee Benefits Institute of America)
EBSA Releases 2008 M-1 Form for MEWAs
Excerpt: "The U.S. Department of Labor's Employee Benefits Security Administration (EBSA) on Wednesday announced the availability of the 2008 Form M-1 annual report for multiple employer welfare arrangements (MEWAs). An EBSA news release said plan administrators may use EBSA's online filing system to expedite processing of the form. MEWAs generally are arrangements that offer medical benefits to the employees of two or more employers or to their beneficiaries." (PLANSPONSOR.com; free registration required)
Escaping the PPA Red Zone - A Case Study of a Multiemployer Plan
Excerpt: "In a mutual effort to improve a Taft-Hartley multiemployer plan's funded status, the employers and the union had agreed in May 2006 on a contract with significant annual contribution increases extending into 2009. Then on August, 17, 2006, the Pension Protection Act of 2006 (PPA) was enacted. Under PPA rules, this plan would be considered in critical status, or in the 'red zone.' The trustees of a plan in critical status are required to work with their actuary to develop optional 'rehabilitation' plans that will allow the actuary to certify that the plan is projected to emerge from critical status." (Milliman)
Congress Fixes Mental Health Parity Deadline for Certain Bargained Health Plans
Excerpt: "Congress has clarified the effective date for mental health and substance abuse parity rules for collectively bargained plans. The new rules will apply the later of (1) plan years starting on or after Jan. 1, 2010, or (2) the termination date of the last bargaining agreement (CBA) relating to the plan. . . . President Bush is expected to sign the measure. [The target page has a link to the full text of the technical correction bill.]" (Mercer LLC)
[Guidance Overview] Bill's Provisions Provide Multiemployer Pension Relief (PDF)
2 pages. Excerpt: "Trustees of multiemployer pension plans must decide whether to elect the zone-status freeze described in the Bulletin, a much more complicated question than it appears at first blush. Similarly, those that are in or will go into the red zone must decide whether to add the extra three years in their rehabilitation plan. This, too, will often require more analysis than appears on the surface, since for many plans recovery from critical status could take longer than the extended 13-year period." (The Segal Group, Inc.)
[Official Guidance] Text of PPA Technical Corrections Bill (H.R. 7327) as Approved by Senate: 'Worker, Retiree, and Employer Recovery Act of 2008'
(U.S. Library of Congress)
Worker, Retiree and Employer Recovery Act also Includes Number of Technical Updates to Pension Protection Act on Pension Funding
Excerpt: "For example, H.R. 7327 also includes: clarification of pension plan 'smoothing,' allowing plans to recognize unexpected asset gains and losses over 24 months; multiemployer plan relief, permitting plan sponsors to elect to temporarily freeze the status of certain multiemployer plans at the same funding status held in the previous plan year; a rule easing the requirement that would otherwise compel employers to restrict the accrual of pension benefits; and improved transition to the new funding rules, in which the phased-in funding threshold would hold at 92% for another year." (PLANSPONSOR.com; free registration required)
[Guidance Overview] Cycle D 2008 Cumulative List of Changes for ERISA Qualified Plans
Excerpt: "According to the IRS, this list is principally to be used by plan sponsors of individually designed plans which are considered Cycle D plans. Generally, a plan is considered a Cycle D plan if the plan sponsor's EIN ends in either 4 or 9, or if it is a multiemployer plan under ?414(f)." (Aiken & Aiken)
[Opinion] UAW Workers Cost the Big Three Automakers $70 an Hour
Excerpt: "The United Auto Workers (UAW) wants Congress to bail out General Motors, Ford, and Chrysler to prevent their undergoing restructuring in bankruptcy proceedings. In bankruptcy, a judge could order union contracts to be renegotiated to reflect competitive realities. Many analysts have objected that hourly autoworkers at the Big Three are some of the most highly paid workers in America, costing the Big Three over $70 an hour in wages and current and future benefits. All taxpayers should not be taxed to preserve the affluence of a few." (The Heritage Foundation)
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