The multiemployer pension plan system is facing a funding crisis with over 100 plans projected to become insolvent in the next 10 to 20 years. This rate of plan insolvency was projected to cause the collapse of the Pension Benefit Guaranty Corporation’s (PBGC’s) multiemployer benefit insurance fund. Insolvency of both underfunded multiemployer pension plans and the PBGC would have left millions of Americans without retirement benefits.
The American Rescue Plan Act of 2021 (ARPA) creates a new PBGC special financial assistance fund for troubled multiemployer pension plans, as well as several other relief provisions that will assist multiemployer pension plans in weathering the loss of contributions and financial distress caused by the COVID-19 public health emergency.
This update examines in detail each form of multiemployer pension plan relief under the ARPA, as well as potential impacts of the ARPA on employers participating in underfunded multiemployer pension plans. Read the full article.