A news release from the Pension Benefit Guaranty Corporation (PBGC) said the employer agreed to make a $39-million plan contribution and to waive an existing $23-million carryover balance. The pension insurer said the Spectrum plan remains under Cooper’s sponsorship, covering about 7,000 workers and retirees, including some 1,300 employed at the Albany, Georgia, plant scheduled to close later this year.
By stopping the Albany operations, Cooper could have faced an obligation to provide protection against $62 million in potential liabilities, which prompted the PBGC to seek the additional funding, the announcement said.
The agency relied on provisions of the Employee Retirement Income Security Act of 1974 (ERISA) permitting PBGC intervention when a plant closing causes more than 20% of covered workers to lose their jobs.
“The PBGC keeps a constant watch for corporate actions that can put pensions and the pension insurance program at greater risk,” said PBGC Acting Director Vince Snowbarger, in the announcement. “But in this instance, when Cooper Tire planned to close their Albany facility, they approached us to negotiate suitable pension funding protections like those announced today.”
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