PBGC has worked with Sears for several years to improve funding for the company’s plans.
A final rule adjusts penalties for inflation.
The early financial assistance from PBGC, together with benefit reductions that are required as a condition for receiving assistance, will help a Pennsylvania union pension plan avoid insolvency.
The new instructions include an expanded list of common filing errors.
A new table will be used for determining expected retirement ages for participants in pension plans undergoing distress or involuntary termination with valuation dates falling in 2019.
One plan type for which coverage determinations are most frequently requested is church plans, according to the agency.
The Pension Analytics Group says the only solution is to reduce benefits across the board, or many of these plans will become insolvent and participants will end up with only pennies on the dollar of the benefits they have accrued.
Senators and co-chairmen Orrin Hatch and Sherrod Brown said they missed their stated deadline for voting on a package of solutions, but the Joint Select Committee on the Solvency of Multiemployer Pension Plans will continue its work during the new session of Congress.
The assistance, along with benefit reductions, will help the plan avoid insolvency.
Modifications to the Form 5500 and Form 5500-SF and their schedules and instructions have been highlighted.
Findings reported in a new white paper suggest that government-subsidized loans would not be an effective mechanism for preventing multiemployer pension plan insolvencies.
The PBGC is proposing in a renewal request that all reportable events filings include controlled group information, company financial statements, and the plan’s actuarial valuation report.
A table on the PBGC’s website shows that the flat-rate premium for single-employer plans has grown from $31 in 2007 to $80 in 2019, and the variable-rate premium has grown from $9 to $43.
The Pension Benefit Guaranty Corporation says that mergers can protect the benefits earned by workers and retirees and extend the solvency of troubled plans.
The PBGC expanded the examples about how to determine premiums in a year when a plan is involved with a spinoff, merger or consolidation, and it expanded the section about short plan years to provide additional information for plans expecting to distribute assets during the 2018 plan year pursuant to a standard termination.
Among other things, a federal appellate court rejected a district court’s decision that the PBGC standards for establishing successor liability are outlined in the Multiemployer Pension Plan Amendment Act of 1980 (MPPAA) and do not apply to single-employer plans.
If there are missing participants that plan sponsors have not made a genuine effort to find, “the entire plan could be disqualified under the tax code and the plan fiduciaries may be found to have breached their ERISA duties,” says Norma Sharara, a partner with Mercer.
The agency identifies information that would be helpful for plan sponsors to provide to help it evaluate proposed alternative terms and conditions to satisfy withdrawal liability.