Employee Benefits & Executive Compensation Blog

The View from Proskauer on Developments in the World of Employee Benefits, Executive Compensation & ERISA Litigation

Category Archives: PBGC

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Let’s Talk – PBGC Pilot Mediation Project is Now Permanent

The Pension Benefit Guaranty Corporation (the “PBGC”) launched a Pilot Mediation Project in October 2017 to provide plan sponsors an opportunity to negotiate resolutions in Early Warning Program cases and in termination liability cases (see our prior post). Following its trial run, the PBGC announced last month that it would make the Mediation Program permanent, … Continue Reading

The Bipartisan Budget Act’s Impact on Retirement Plans

On Friday, February 9, 2018, Congress passed, and the President signed, the Bipartisan Budget Act of 2018 (the “Budget Act”). The Budget Act contains a number of provisions that affect qualified retirement plans.  Plan sponsors should consider the impact of the Budget Act on their retirement programs. Hardship Withdrawals. The Budget Act relaxes the rules … Continue Reading

New PBGC-Plan Sponsor Pilot Mediation Project for Early Warning Program and Termination Liability Cases

The Pension Benefit Guaranty Corporation (the “PBGC”) launched a new Pilot Mediation Project to facilitate negotiations with (i) plan sponsors involved in corporate transactions under the purview of the PBGC’s Early Warning Program and (ii) the former plan sponsors of terminated pension plans that are subject to termination liability for the plans’ unfunded benefit liabilities.… Continue Reading

Sun Capital Court Finds Co-Investing Funds Part of Controlled Group and Liable for Portfolio Company’s Pension Liabilities

As we previously reported, in Sun Capital, the U.S. Court of Appeals for the First Circuit held in 2013 that a private investment fund, pursuant to the so-called “investment plus” test first articulated by the Pension Benefit Guaranty Corporation (the PBGC), was engaged in a “trade or business” under the Employee Retirement Income Security Act … Continue Reading

Bipartisan Budget Act Extends MAP-21 Pension Funding Relief and Increases PBGC Premiums

On Monday, November 1, 2015, President Obama signed into law the Bipartisan Budget Act of 2015 (the “BBA”) which brings familiar changes for sponsors of defined benefit pension plans. Similar to the Moving Ahead for Progress in the 21st Century Act in 2012 (“MAP-21”), the BBA provides relief from pension funding obligations while increasing PBGC … Continue Reading

2015 PBGC Premium Filings Must Include Risk Transfer Disclosures

The Pension Benefit Guaranty Corporation (the “PBGC”) recently finalized its premium filing requirements for 2015.  In addition to higher premium rates and other more minor changes, plan sponsors are now required to report information about the number of former employees involved in certain risk transfer activities (i.e., annuity purchases and lump sum windows) that occurred … Continue Reading

PBGC Issues Final Regulations Regarding Rollovers from Defined Contribution Plans to Pension Plans

The PBGC has recently initiated efforts to enhance retirement security for Americans by promoting lifetime income options (i.e., annuitized benefits).  As part of these efforts, as well as those of the IRS and U.S. Department of Labor, the PBGC issued final regulations regarding the treatment of rollovers from defined contribution plans to defined benefit plans … Continue Reading

The PBGC Changes Flat-Rate Premium Due Date for Large Plans

The PBGC finalized a proposed rule that changes the flat-rate premium due date for large plans to the same as their variable-rate due date, which is 9.5 calendar months after the beginning of the premium payment year (October 15th for calendar-year plans), effective as of the 2014 plan year. Large plans are plans that had … Continue Reading

The PBGC Not Entitled to Administrative Deference for Involuntary Plan Termination

As we previously noted (https://www.erisapracticecenter.com/2013/04/28/pbgc-seeks-involuntary-plan-termination-before-plan-sponsors-proposed-share-sale/), the PBGC filed a complaint (E.D. Pa. Case No. 13-02069) to involuntarily terminate a defined benefit plan prior to a corporate transaction that would change the plan sponsor’s controlled group. The PBGC claimed that the plan sponsor, Saint-Gobain Containers, Inc., would join a financially weaker controlled group after it is … Continue Reading

PBGC Releases 4062(e) Enforcement Guidelines

ERISA section 4062(e) addresses situations in which an employer ceases operations at a facility in any location and, as a result, separates more than 20% of its employees who participate in the employer’s defined benefit plan. If a 4062(e) event occurs, the employer is subject to a liability that equals the plan’s unfunded benefit liabilities … Continue Reading

PBGC Seeks Involuntary Plan Termination before Plan Sponsor’s Proposed Share Sale

On April 18, 2013, PBGC filed a complaint (PBGC v. Saint-Gobain Corp. Benefits Comm., E.D. Pa. Case No. 13-02069) to involuntarily terminate a defined benefit plan sponsored by Saint-Gobain Containers, Inc. before Ardagh Group, S.A. acquires Saint-Gobain through a share purchase. PBGC alleges that the plan is underfunded by approximately $523.7 million and that the … Continue Reading

Ninth Circuit Rules on Breach of Fiduciary Duty Claim in Investment Options Case

In Tibble v. Edison Int’l, 10-cv-56406, 2013 WL 1174167 (9th Cir. Mar. 21, 2013), the Ninth Circuit Court of Appeals ruled that 401(k) plan fiduciaries breached their duty of prudence in selecting investment options for the plan and unreasonably relied on a consultant’s advice because they could not prove that either they– or the consultant … Continue Reading
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