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Guest Article


(From the January 23, 2006 issue of Deloitte's Washington Bulletin, a periodic update of legal and regulatory developments relating to Employee Benefits.)

DOL Final Regulations on Annual Funding Notice by Multiemployer Plans

The Department of Labor has issued final rules implementing the annual funding notice for multiemployer defined benefit plans. 71 FR 1904 (January 11, 2006). The final regulations, which are effective February 10, 2006 and apply to plan years beginning after December 31, 2004, provide guidance on the content requirements for the annual notice, the timing requirements for the notice, and who is entitled to receive the notice. Additionally, the final regulations include a model notice multiemployer plans can use -- but do not have to use -- to satisfy the annual notice requirement. Single-employer plans are not subject to the annual funding notice requirement.


Congress added section 101(f) to the Employee Retirement Income Security Act (ERISA) as part of the Pension Funding Equity Act (PFEA) of 2004. ERISA § 101(f) requires administrators of multiemployer defined benefit plans to provide an annual funding notice to "each plan participant and beneficiary, to each labor organization representing such participants or beneficiaries, to each employer that has an obligation to contribute under the plan, and to the Pension Benefit Guaranty Corporation." The notice must include information about the plan's funded current liability percentage, the value of the plan's assets, and a summary of the rules governing insolvent multiemployer plans. Additionally, ERISA § 101(f) requires the plan administrator to provide the annual funding notice no more than two months after the deadline (including extensions) for filing the plan's Form 5500.


As noted, ERISA § 101(f) establishes specific content requirements for the annual funding notice. In addition to the items listed in the statute, the regulations state the annual funding notice must include the following information:

  • The plan name;
  • The plan administrator's address and phone number (and the address and phone number for the plan's principal administrative officer, if different from the plan administrator);
  • The plan sponsor's employer identification number; and
  • The plan number.

The regulations also clarify that the plan administrator can include additional information that is "necessary or helpful to understanding the mandatory information in the notice." This information, if included, must be placed at the end of the notice under the heading "Additional Explanation."


According to the regulations, the plan administrator must furnish the annual funding notice within nine months after the close of the plan year unless the IRS has granted the plan administrator an extension to file the plan's Form 5500. In the latter case the funding notice must be provided within two months after the extension period closes.

Who Gets the Notice?

As noted, the plan administrator must provide the annual funding notice to the following:

  • Each participant covered under the plan on the last day of the plan year to which the notice relates;
  • Each beneficiary receiving benefits under the plan on the last day of the plan year to which the notice relates;
  • Each labor organization representing participants under the plan on the last day of the plan year to which the notice relates;
  • The PBGC; and
  • Each employer that, as of the last day of the plan year to which the notice relates, is a party to the collective bargaining agreement(s) pursuant to which the plan is maintained or who otherwise may be subject to withdrawal liability pursuant to ERISA § 4023.

The preamble to the final regulations clarifies that plan administrators do not have to provide the annual funding notice to employers just because they are in the same controlled group as an employer entitled to receive the notice. Additionally, plan administrators do not have to provide the notice to withdrawn employers.

DeloitteThe information in this Washington Bulletin is general in nature only and not intended to provide advice or guidance for specific situations.

If you have questions or need additional information about articles appearing in this or previous versions of Washington Bulletin, please contact: Robert Davis 202.879.3094, Elizabeth Drigotas 202.879.4985, Taina Edlund 202.879.4956, Laura Edwards 202.879.4981, Mike Haberman 202.879.4963, Stephen LaGarde 202.879-5608, Bart Massey 202.220.2104, Diane McGowan 202.220.2077, Martha Priddy Patterson 202.879.5634, Tom Pevarnik 202.879.5314, Carlisle Toppin 202.220.2067, Tom Veal 312.946.2595, Deborah Walker 202.879.4955.

Copyright 2006, Deloitte.

BenefitsLink is an independent national employee benefits information provider, not formally affiliated with the firms and companies who kindly provide much of the content and advertisements published on this Web site, including the article shown above.
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