DoL Requires Funding Notice for Multiemployer Pension Plans

According to a press release the requirement falls under the provisions of the Pension Funding Equity Act of 2004 (See  PBGC Issues Guidance on Participant Notice of Underfunding  ).

The regulation requires that a notice be sent annually to multiemployer plan participants, beneficiaries, labor organizations, contributing employers and the Pension Benefit Guaranty Corporation (PBGC).   The notice must include basic financial information about the multiemployer plan, including a statement as to whether or not the plan is 100% funded.  

In addition, the notice must provide a comparison of the plan’s assets to benefit payments, a description of the law governing insolvent multiemployer plans, and the benefits guaranteed under the PBGC’s multiemployer program.   The DoL included a model notice in the rules to aid in compliance for administrators.

“These rules will ensure that workers and employers receive important information about the funding status of their multiemployer plans and encourage sound funding so that sufficient assets are available to pay future benefits,” said Ann Combs, assistant secretary of labor for employee benefits security, in the release.   “The rules will result in greater transparency for individuals, employers and the government.”

The rules will be published in the Federal Register on Wednesday.