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Play nice.

Does anyone really believe the government won't bailout the PBGC when the time comes? Back in the '80s everyone one of my finance prof said the same thing. Legally Freddie and Fanny were not guarantee by the government but their bonds sell like their is an implied government guarantee. The market was right and the lawyers who said there was no legal obligation were wrong. The government couldn't afford to allow the repercussions of Freddie and Fanny going under. The market saw the political reality. The simple fact is if the PBGC defaults you are going to have the news showing you pictures of retirees many of whom took pension cuts because the PBGC payment cap now being told they might get little or nothing more from the PBGC and congress will fold and vote the funds to pay those people. So if you were to ask me about the pension I have earned at a former employers: Which would you prefer PBGC protection or the idea Pru won't go insolvent I would pick PBGC every time. Don't get me wrong. Nothing I am saying here makes me believe these people have a case for court or if my former employer de-risked I would be up in arms over getting a Pru annuity. I think the odds of Pru going insolvent is very, very low. I just so happen to think that the PBGC in fact has a very rich sugar daddy that won't ever allow it to go insolvent.

There's no blanket exemption for multiemployer plans but there is a rule that allows you to exclude bargained employees from testing (see Internal Revenue Code § 410(b)(3) which is referenced by § 401(a)(4)). That generally makes such testing unnecessary. However, multiemployer plans do need to worry about discrimination testing with respect to any nonunion employees covered under the plan (e.g., union officials covered under a special agreement).