quoted McGuireWoods associate
Robert Wynne in a
July 14, 2021, article on the new interim regulations released by the Pension Benefit Guaranty
Titled “New PBGC Regs Leave Employers Scratching Their Heads,” the article
noted that while the regulations describe how a $94 billion financial
assistance program for troubled union pension plans will work, the impact
on employer withdrawals is unclear.
A number of factors have made funding for union pension plans an issue for
years. Although a Biden administration fix in the American Rescue Plan
addressed pension insolvencies, it did not specify the impact on employers
that want to withdraw from those plans.
"PBGC was clear in stating that they do not want these special financial
assistance payments to indirectly subsidize employer withdrawals, so I
suspect it will tend to have the result of the liability being greater, but
it's hard to say at this point, and it remains to be seen how it all will
play out," Wynne said.
For more on this topic, read Wynne’s July 13, 2021, client alert,
New Withdrawal Liability Rules for Pension Bailout Recipients.