I 

111TH CONGRESS 

1ST SESSION H. R. 4281 

To amend the Employee Retirement Income Security Act of 1974 and title 

11, United States Code, to provide necessary reforms for employee pension benefit plans. 

IN THE HOUSE OF REPRESENTATIVES 

DECEMBER 10, 2009 

Mr. VISCLOSKY introduced the following bill; which was referred to the Committee on Education and Labor, and in addition to the Committee on the 

Judiciary, for a period to be subsequently determined by the Speaker, in 

each case for consideration of such provisions as fall within the jurisdiction of the committee concerned 

A BILL 

To amend the Employee Retirement Income Security Act 

of 1974 and title 11, United States Code, to provide 

necessary reforms for employee pension benefit plans. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Employees’ Pension 

5 Security Act of 2009’’. 


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1 TITLE I—TRUSTEESHIP OF 

2 SINGLE-EMPLOYER PLANS 

3 SEC. 101. REQUIREMENTS RELATING TO TRUSTEESHIP OF 

4 SINGLE-EMPLOYER PLANS. 

5 (a) IN GENERAL.—Section 403(a) of the Employee 

6 Retirement Income Security Act of 1974 (29 U.S.C. 

7 1103(a)) is amended— 

8 (1) by redesignating paragraphs (1) and (2) as 

9 subparagraphs (A) and (B), respectively; 

10 (2) by inserting ‘‘(1)’’ after ‘‘(a)’’; and 

11 (3) by adding at the end the following new 

12 paragraph: 

13 ‘‘(2)(A) The assets of a pension plan which is a sin14 gle-employer plan shall be held in trust by a joint board 

15 of trustees, which shall consist of two or more trustees 

16 representing on an equal basis the interests of the em17 ployer or employers maintaining the plan and the interests 

18 of the participants and their beneficiaries. 

19 ‘‘(B)(i) Except as provided in clause (ii), in any case 

20 in which the plan is maintained pursuant to one or more 

21 collective bargaining agreements between one or more em22 ployee organizations and one or more employers, the trust23 ees representing the interests of the participants and their 

24 beneficiaries pursuant to subparagraph (A) shall be des25 ignated by such employee organizations. 


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1 ‘‘(ii) Clause (i) shall not apply with respect to a plan 

2 described in such clause if the employee organization (or 

3 all employee organizations, if more than one) referred to 

4 in such clause file with the Secretary, in such form and 

5 manner as shall be prescribed in regulations of the Sec6 retary, a written waiver of their rights under clause (i). 

7 ‘‘(iii) In any case in which clause (i) does not apply 

8 with respect to a pension plan which is a single-employer 

9 plan because the plan is not described in clause (i) or be10 cause of a waiver filed pursuant to clause (ii), the trustee 

11 or trustees representing the interests of the participants 

12 and their beneficiaries shall consist of one or more partici13 pants under the plan elected to serve as such in accord14 ance with this clause. The Secretary shall provide by regu15 lation for a secret ballot of the participants under the plan 

16 for purposes of such election, and for certification of the 

17 results thereof to the participants (and any employee orga18 nization referred to in clause (ii)) and to the employer.’’. 

19 (b) CONFORMING AMENDMENTS.—Section 403(a)(1) 

20 of such Act (as redesignated under subsection (a)) is 

21 amended— 

22 (1) by striking ‘‘Such trustee or trustees’’ and 

23 inserting ‘‘Except as provided in paragraph (2), such 

24 trustee or trustees’’; 


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1 (2) by striking ‘‘fiduciary, and upon accept2 ance’’ and inserting ‘‘fiduciary. Upon acceptance’’; 

3 and 

4 (3) in subparagraph (A) (as so redesignated), 

5 by striking ‘‘the plan’’ the first place it appears and 

6 inserting ‘‘in the case of a plan other than a pension 

7 plan which is a single-employer plan, the plan’’. 

8 SEC. 102. EFFECTIVE DATE. 

9 The amendments made by this title shall apply with 

10 respect to plan years beginning after 180 days after the 

11 date of the enactment of this Act. The Secretary of Labor 

12 shall prescribe the initial regulations necessary to carry 

13 out the provisions of such amendments not later than 90 

14 days after the date of the enactment of this Act. 

15 TITLE II—INVESTMENT 

16 INFORMATION 

17 SEC. 201. PROVISION TO PARTICIPANTS AND BENE18 FICIARIES OF MATERIAL INVESTMENT IN19 FORMATION IN ACCURATE FORM. 

20 (a) IN GENERAL.—Section 404(c) of the Employee 

21 Retirement Income Security Act of 1974 (29 U.S.C. 

22 1104(c)) is amended by adding at the end the following 

23 new paragraph: 

24 ‘‘(6) PROVISION OF ACCURATE MATERIAL IN25 VESTMENT ADVICE.—The plan sponsor and plan adVerDate Nov 24 2008 05:47 Dec 12, 2009 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H4281.IH H4281

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1 ministrator of a pension plan described in paragraph 

2 (1) shall have a fiduciary duty to ensure that each 

3 participant and beneficiary under the plan, in con4 nection with the investment by the participant or 

5 beneficiary of plan assets in the exercise of his or 

6 her control over assets in his account, is provided 

7 with all material investment information regarding 

8 investment of such assets to the extent that the pro9 vision of such information is generally required to be 

10 disclosed by the plan sponsor to investors in connec11 tion with such an investment under applicable secu12 rities laws. The provision by the plan sponsor or 

13 plan administrator of any misleading investment in14 formation shall be treated as a violation of this para15 graph.’’. 

16 (b) ENFORCEMENT.— 

17 (1) IN GENERAL.—Section 502(c) of such Act 

18 (29 U.S.C. 1132(c)) is amended— 

19 (A) by redesignating the second paragraph 

20 (10) (relating to ongoing consultation between 

21 the Secretary of Labor and the Secretary of 

22 Health and Human Services) as paragraph 

23 (12); and 

24 (B) by inserting after the first paragraph 

25 (10) the following new paragraph: 


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1 ‘‘(11) SECRETARIAL ENFORCEMENT AUTHORITY

2 RELATING TO PROVISION OF ACCURATE MATERIAL

3 INVESTMENT ADVICE.—The Secretary may assess a 

4 civil penalty against any person of up to $1,000 a 

5 day from the date of the person’s failure or refusal 

6 to comply with the requirements of section 404(c)(6) 

7 until such failure or refusal is corrected.’’. 

8 (2) CONFORMING AMENDMENT.—Section 

9 502(a)(6) of such Act (29 U.S.C. 1132(a)(6)) is 

10 amended by striking ‘‘(8), or (9)’’ and inserting 

11 ‘‘(8), (9), (10), or (11)’’. 

12 SEC. 202. EFFECTIVE DATE OF TITLE. 

13 The amendments made by this title shall apply with 

14 respect to investments made on or after the date of the 

15 enactment of this Act. 

16 TITLE III—STRENGTHENED PRO17 TECTIONS AGAINST ABUSE 

18 OF THE BANKRUPTCY AND 

19 TERMINATION PROCESS 

20 SEC. 301. ADDITIONAL REQUIREMENTS FOR TERMINATION. 

21 (a) ADDITIONAL REQUIREMENTS FOR DISTRESS

22 TERMINATION.—Section 4041(c)(2) of the Employee Re23 tirement Income Security Act of 1974 (29 U.S.C. 

24 1341(c)(2)) is amended by adding at the end the fol25 lowing: 


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1 ‘‘(E) ADDITIONAL REQUIREMENTS.—Not2 withstanding any other provision of this section, 

3 unless the corporation or the court, in the case 

4 of a distress termination pursuant to subpara5 graph (B)(ii), has determined that reasonable 

6 efforts to consider available alternatives to ter7 mination (including, but not limited to, alter8 natives described in section 4042(c)(4)) have 

9 been undertaken by such person (and, in the 

10 case of a plan maintained pursuant to a collec11 tive bargaining agreement, have been under12 taken by the bargaining parties in good faith 

13 bargaining), the plan may not be terminated. A 

14 participant or beneficiary of the plan or an em15 ployee organization representing such partici16 pants or beneficiaries may bring an action in 

17 the appropriate court to challenge such deter18 mination by the corporation and seek equitable 

19 relief or must be afforded an opportunity to be 

20 heard by the appropriate court if a court is 

21 making such determination.’’. 

22 (b) ADDITIONAL REQUIREMENTS FOR COURT DE23 CREES.—Section 4042(c)(1) of such Act (29 U.S.C. 

24 1342(c)(1)) is amended— 


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1 (1) by inserting after the first sentence the fol2 lowing new sentences: ‘‘The court may not enter 

3 such a decree unless that court has found that rea4 sonable efforts to consider available alternatives to 

5 termination (including, but not limited to, alter6 natives described in paragraph (4)) have been under7 taken by the plan sponsor (and, in the case of a plan 

8 maintained pursuant to a collective bargaining 

9 agreement, have been undertaken by the bargaining 

10 parties in good faith bargaining). There is a pre11 sumption that a plan need not be terminated if the 

12 plan sponsor can continue in business, outside a case 

13 under title 11, United States Code (or under any 

14 similar law of a State or a political subdivision of a 

15 State) in which reorganization is sought, without 

16 terminating the plan.’’; and 

17 (2) in the sentence following the sentences in18 serted by paragraph (1), by striking ‘‘the preceding 

19 sentence’’ and inserting ‘‘the first sentence of this 

20 paragraph,’’. 

21 (c) RIGHT TO INTERVENE TO CHALLENGE COURT

22 DECREE.—Section 4042(c) of such Act (as amended by 

23 subsection (b)) is further amended by inserting after the 

24 fourth sentence the following new sentence: ‘‘If any party 

25 consisting of the plan sponsor, a plan participant, or (in 


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1 the case of a plan maintained pursuant to a collective bar2 gaining agreement) the employee organization rep3 resenting plan participants for purposes of collective bar4 gaining disagrees with any such determination by the cor5 poration, such party may intervene in the proceeding to 

6 challenge the determinations of the corporation.’’. 

7 (d) CONSIDERATION OF ALTERNATIVES BY COR8 PORATION AND PLAN SPONSOR.—Section 4042(c) of such 

9 Act (as amended by the preceding provisions of this sec10 tion) is further amended by adding after the seventh sen11 tence the following: ‘‘The corporation and the plan admin12 istrator may proceed with such an agreement only if they 

13 have made reasonable efforts to consider available alter14 natives to termination (including, but not limited to, alter15 natives described in paragraph (4) of this subsection) and 

16 the plan participants and beneficiaries have been provided 

17 with at least 60 days notice before such agreement is given 

18 effect. During such 60-day period, a participant or bene19 ficiary of the plan or an employee organization rep20 resenting such participants or beneficiaries may bring an 

21 action in the appropriate court to seek appropriate equi22 table relief if such reasonable efforts have not been 

23 made.’’. 

24 (e) EFFORTS BY THE CORPORATION AT CONSULTA25 TION WITH PARTIES.—Section 4042(c) of such Act is 


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1 amended by adding at the end the following new para2 graph: 

3 ‘‘(4) CONSULTATION REGARDING REASONABLE

4 AVAILABLE ALTERNATIVES TO TERMINATION.— 

5 ‘‘(A) IN GENERAL.—Prior to making any 

6 determination referred to in the preceding pro7 visions of this subsection, the corporation shall 

8 consult with the plan participants and (in the 

9 case of a plan maintained pursuant to a collec10 tive bargaining agreement) the employee orga11 nization representing plan participants for pur12 poses of collective bargaining to determine 

13 whether there are any reasonable available al14 ternatives to termination (including, but not 

15 limited to, alternatives described in subpara16 graph (B)). 

17 ‘‘(B) REASONABLE ALTERNATIVES TO

18 TERMINATION.—The reasonable alternatives to 

19 termination referred to in subparagraph (A) 

20 consist of measures which are in the best inter21 est of plan participants and which include (but 

22 are not limited to) the following: — 

23 ‘‘(i) Financing or loans sought by any 

24 member of the plan sponsor’s controlled 

25 group, with or without assistance from the 


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1 corporation, in order to obtain plan financ2 ing, including back-up guarantees to any 

3 such financing which the corporation is 

4 hereby authorized to provide for such pur5 pose. 

6 ‘‘(ii) New plan structures agreed to by 

7 the parties, such as transfer of plan liabil8 ities to multiemployer plans, new benefit 

9 formulas for new hires or non-vested par10 ticipants, or other plan restructuring alter11 natives agreed to by the parties. 

12 ‘‘(iii) Reinsurance which the corpora13 tion is hereby authorized to obtain for the 

14 plan. 

15 ‘‘(iv) An agreement by the parties au16 thorizing alternative funding schedules, ap17 proved by the corporation, which would 

18 modify plan funding, subject to the min19 imum funding requirements for the plan 

20 under part 3 of subtitle B of title I. 

21 ‘‘(v) Purchase by the plan sponsor of 

22 an annuity contract to cover liabilities of 

23 the plan, which the corporation is hereby 

24 authorized to guarantee as necessary to se25 cure such a contract.’’. 


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1 (f) NOTICE OF RIGHT TO CHALLENGE DETERMINA2 TIONS RELATING TO PLAN TERMINATION.— 

3 (1) PROCEDURE FOR STANDARD TERMI4 NATIONS.—Section 4041(b)(2)(B) of such Act (29 

5 U.S.C. 1341(b)(2)(B)) is amended in clause (i) by 

6 striking ‘‘and’’ at the end, in clause (ii)(V) by strik7 ing ‘‘require.’’ and inserting ‘‘require, and’’, and by 

8 inserting after clause (ii) the following new clause: 

9 ‘‘(iii) describing the right of partici10 pants and beneficiaries to challenge deter11 minations under this section.’’. 

12 (2) TERMINATION PROCEEDINGS FOR DISTRESS

13 TERMINATIONS AND TERMINATIONS COMMENCED BY

14 THE PBGC.—Section 4042(a) of such Act (29 U.S.C. 

15 1342(a)) is amended by adding at the end the fol16 lowing new sentence: ‘‘Prior to commencing pro17 ceedings under this section with respect to any plan, 

18 the corporation shall provide notice to plan partici19 pants and beneficiaries of the right to challenge de20 terminations under this section, written in a manner 

21 likely to be understood by the participant or bene22 ficiary.’’. 

23 SEC. 302. EFFECTIVE DATE OF TITLE. 

24 The amendments made by this title shall apply with 

25 respect to any plans undergoing termination proceedings 


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1 pursuant to section 4041 or 4042 of the Employee Retire2 ment Income Security Act of 1974 which are pending on 

3 or after the date of the enactment of this Act. 

4 TITLE IV—RECOVERY OF BEN5 EFIT LIABILITIES WHICH ARE 

6 NOT GUARANTEED 

7 SEC. 401. AMENDMENT TO TITLE 11 OF THE UNITED 

8 STATES CODE. 

9 Section 507(a)(1) of title 11, United States Code, is 

10 amended by adding at the end the following: 

11 ‘‘(D) Subject to subparagraphs (A), (B), 

12 and (C), allowed unsecured claims for benefit li13 abilities to participants and beneficiaries under 

14 a single-employer plan (as defined in section 

15 4001(a)(15) of the Employee Retirement In16 come Security Act of 1974) in connection with 

17 the termination of the plan, in excess of the 

18 benefits payable to the participants and bene19 ficiaries by the Pension Benefit Guaranty Cor20 poration under section 4022 of the Employee 

21 Retirement Income Security Act of 1974 in 

22 connection with such termination.’’. 

23 SEC. 402. EFFECTIVE DATE; APPLICATION OF AMENDMENT. 

24 (a) EFFECTIVE DATE.—Except as provided in sub25 section (b), section 401 and the amendment made by such 


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1 section shall take effect on the date of the enactment of 

2 this Act. 

3 (b) APPLICATION OF AMENDMENT.—The amendment 

4 made by section 401 shall not apply with respect to cases 

5 commenced under title 11 of the United States Code be6 fore the date of the enactment of this Act. 

Æ 


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