The U.S. Department of Labor (DOL) published a final rule on multiemployer pension plan transparency on Feb. 26, 2010. The rule, Multiemployer Pension Plan Information Made Available on Request, establishes new guidelines on the disclosure of funding and other financial information to workers participating in multiemployer retirement plans. These plans are subject to collective bargaining between unions and groups of employers.
A 2009 survey by the nonprofit International Foundation of Employee Benefit Plans found that the number of multiemployer pension plans less than 80 percent funded had quadrupled from a year earlier (see Multiemployer Defined Benefit Plans: Only 20% Rate 'Safe' Funded Status).
The final rule seeks to ensure transparency by guaranteeing that workers can monitor the financial condition and day-to-day operations of their retirement investments better, as described in a fact sheet posted by the DOL. The rule will go into effect in April 2010.
The rule requires the administrator of a multiemployer pension plan, on the written request of any plan participant, beneficiary, employee representative (e.g., union) or any employer that has an obligation to contribute to the plan, to furnish copies of requested financial and actuarial reports of the plan. The documents required to be furnished are:
• Periodic actuarial reports.
• Quarterly, semi-annual or annual financial reports.
• Certain applications filed with the secretary of the treasury and related determinations (amortization extensions).
A plan administrator must furnish the requested documents within 30 days from the request. The secretary of labor may assess a civil penalty against any person of up to $1,000 a day for each violation.
Stephen Miller is an online editor/manager for SHRM.
Multiemployer Alert: Final Rule Issued on Participant-Requested Documents, Milliman, March 2010
Multiemployer Defined Benefit Plans: Only 20% Rate 'Safe' Funded Status, SHRM Online Benefits Discipline, May 2009
Multiemployer Pension Plans: Proposed IRS, PBGC Rules Shine Spotlight on Funding Liabilities, SHRM Online Benefits Discipline, March 2008
SHRM Online Benefits Discipline