Compliance September 20, 2019

PBGC Releases New Forms Relating to ERISA Section 4062(e)

In 2014, President Barack Obama signed into law major changes to Section 4062(e), which requires companies with defined benefit (DB) plans to report to the PBGC when they stop operations at a facility and employees lose their jobs.

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The Pension Benefit Guaranty Corporation (PBGC) has released new forms related to Employee Retirement Income Security Act (ERISA) Section 4062(e), which requires companies with defined benefit (DB) plans to report to the PBGC when they stop operations at a facility and employees lose their jobs. 

In such a case, 4062(e) requires the company to provide financial security to protect the plan. The PBGC typically requires companies to make additional contributions or provide a financial guarantee. 

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In 2012, the agency implemented a pilot program under which it would generally take no action to enforce section 4062(e) liability against creditworthy companies or small plans and target its 4062(e) enforcement efforts to companies where the risk remained substantial. In 2014, President Barack Obama signed into law H.R. 83, which made major changes to Section 4062(e).

The new forms include:

  • Form 4062(e)-01, used to notify the PBGC of a substantial cessation of operations;
  • Form 4062(e)-02, used to notify the agency of an election to make additional annual contributions;
  • Form 4062(e)-03, used to notify the PBGC of a payment of an additional contribution, termination of obligation for future contributions, or receipt of a funding waiver from the IRS; and
  • Form 4062(e)-04, used to notify the agency of a failure to pay an additional contribution.

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