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Compliance January 11, 2010
PBGC Takes Chicago Clothing Manufacturer's Plan
January 11, 2010 (PLANSPONSOR.com) - The Pension Benefit Guaranty Corp.
(PBGC) has assumed responsibility for the underfunded pension plan covering
nearly 13,000 former workers and retirees of Hartmarx Corp.
Reported by Rebecca Moore
The agency said it stepped in because the plan faced abandonment after the company, in bankruptcy since January 23, 2009, sold all of its assets to purchasers who did not assume responsibility for financing or administering the plan. The PBGC estimates the Hartmarx Retirement Income Plan is 47% funded, with assets of $142.8 million to cover $306.6 million in benefit liabilities, and expects to be responsible for $158.5 million of the $163.8 million shortfall.
The plan ended on August 7, 2009.
Hartmarx, a clothing manufacturer based in Chicago, Illinois, produced and marketed business, casual, and golf apparel under its own brands, which included Hart Schaffner Marx, Hickey-Freeman, Palm Beach, and Coppley among others. The PBGC said a dropoff in demand for tailored clothing led to poor sales, and the company and 51 affiliates sought Chapter 11 protection in the U.S. Bankruptcy Court in Chicago.