Independent Fiduciary Services (IFS), which was appointed earlier this year as part of an agreement between United parent UAL and the US Department of Labor (DoL) (See United, DoL Agree to Independent Fiduciary ), will ask that the company’s minimum pension funding requirements be designated as “administrative priority expenses” and released, Dow Jones reported.
As per terms of its appointment, IFS was authorized to
- review the funding policy of the plans
- assert claims
- file lawsuits about the plans’ funding and the company’s contributions.
“IFS has reviewed documents and conducted investigations contemplated by its agreement,” according to documents expected to be filed with the court, Dow Jones reported. “Based on its investigation, IFS has determined that United has not only failed to pay mandatory (pension) contributions required by the Internal Revenue Service Code which came due (after the bankruptcy filing), but also those contributions directly attributable to the post-petition service of its employees.”
In June, the airline’s Board of Directors changed the structure for managing its retirement plans by eliminating the plans’ administrative committee and appointing UAL, the parent company, as the sole plan fiduciary. On July 15, UAL did not make a required $72 million contribution to three of the plans, claiming its bankruptcy financing prohibited it from doing so. (See United Skipping Fall Pension Payment ).