I 

110TH CONGRESS 

2D SESSION H. R. 5754 

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

11, United State Code, to provide necessary reforms for employee pension 

benefit plans. 

IN THE HOUSE OF REPRESENTATIVES 

APRIL 9, 2008 

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 State 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 2008’’. 


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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 Aug 31 2005 03:32 Apr 11, 2008 Jkt 069200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H5754.IH H5754

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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 paragraph (9) as 

20 paragraph (10); and 

21 (B) by inserting after paragraph (8) the 

22 following new paragraph: 

23 ‘‘(9) The Secretary may assess a civil penalty against 

24 any person of up to $1,000 a day from the date of the 

25 person’s failure or refusal to comply with the requirements 


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1 of section 404(c)(6) until such failure or refusal is cor2 rected.’’. 

3 (2) CONFORMING AMENDMENT.—Section 

4 502(a)(6) of such Act (29 U.S.C. 1132(a)(6)) is 

5 amended by striking ‘‘(7), or (8)’’ and inserting 

6 ‘‘(7), (8), or (9)’’. 

7 SEC. 202. EFFECTIVE DATE OF TITLE. 

8 The amendments made by this title shall apply with 

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

10 enactment of this Act. 

11 TITLE III—STRENGTHENED PRO12 TECTIONS AGAINST ABUSE 

13 OF THE BANKRUPTCY AND 

14 TERMINATION PROCESS 

15 SEC. 301. ADDITIONAL REQUIREMENTS FOR TERMINATION. 

16 (a) ADDITIONAL REQUIREMENTS FOR DISTRESS

17 TERMINATION.—Section 4041(c)(2) of the Employee Re18 tirement Income Security Act of 1974 (29 U.S.C. 

19 1341(c)(2)) is amended by adding at the end the fol20 lowing: 

21 ‘‘(E) ADDITIONAL REQUIREMENTS.—Not22 withstanding any other provision of this section, 

23 unless the corporation or the court, in the case 

24 of a distress termination pursuant to subpara25 graph (B)(ii), has determined that reasonable 


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1 efforts to consider available alternatives to ter2 mination (including, but not limited to, alter3 natives described in section 4042(c)(4)) have 

4 been undertaken by such person (and, in the 

5 case of a plan maintained pursuant to a collec6 tive bargaining agreement, have been under7 taken by the bargaining parties in good faith 

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

9 participant or beneficiary of the plan or an em10 ployee organization representing such partici11 pants or beneficiaries may bring an action in 

12 the appropriate court to challenge such deter13 mination by the corporation and seek equitable 

14 relief or must be afforded an opportunity to be 

15 heard by the appropriate court if a court is 

16 making such determination.’’. 

17 (b) ADDITIONAL REQUIREMENTS FOR COURT DE18 CREES.—Section 4042(c)(1) of such Act (29 U.S.C. 

19 1342(c)(1)) is amended— 

20 (1) by inserting after the first sentence the fol21 lowing new sentences: ‘‘The court may not enter 

22 such a decree unless that court has found that rea23 sonable efforts to consider available alternatives to 

24 termination (including, but not limited to, alter25 natives described in paragraph (4) have been underVerDate Aug 31 2005 03:32 Apr 11, 2008 Jkt 069200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H5754.IH H5754

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1 taken by the plan sponsor (and, in the case of a plan 

2 maintained pursuant to a collective bargaining 

3 agreement, have been undertaken by the bargaining 

4 parties in good faith bargaining). There is a pre5 sumption that a plan need not be terminated if the 

6 plan sponsor can continue in business, outside a case 

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

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

9 State) in which reorganization is sought, without 

10 terminating the plan.’’; and 

11 (2) in the sentence following the sentences in12 serted by paragraph (1), by striking ‘‘the preceding 

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

14 paragraph,’’. 

15 (c) RIGHT TO INTERVENE TO CHALLENGE COURT

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

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

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

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

20 the case of a plan maintained pursuant to a collective bar21 gaining agreement) the employee organization rep22 resenting plan participants for purposes of collective bar23 gaining disagrees with any such determination by the cor24 poration, such party may intervene in the proceeding to 

25 challenge the determinations of the corporation.’’. 


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1 (d) CONSIDERATION OF ALTERNATIVES BY COR2 PORATION AND PLAN SPONSOR.—Section 4042(c) of such 

3 Act (as amended by the preceding provisions of this sec4 tion) is further amended by adding after the seventh sen5 tence the following: ‘‘The corporation and the plan admin6 istrator may proceed with such an agreement only if they 

7 have made reasonable efforts to consider available alter8 natives to termination (including, but not limited to, alter9 natives described in paragraph (4) of this subsection) and 

10 the plan participants and beneficiaries have been provided 

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

12 effect. During such 60-day period, a participant or bene13 ficiary of the plan or an employee organization rep14 resenting such participants or beneficiaries may bring an 

15 action in the appropriate court to seek appropriate equi16 table relief if such reasonable efforts have not been 

17 made.’’. 

18 (e) EFFORTS BY THE CORPORATION AT CONSULTA19 TION WITH PARTIES.—Section 4042(c) of such Act is 

20 amended by adding at the end the following new para21 graph: 

22 ‘‘(4) CONSULTATION REGARDING REASONABLE

23 AVAILABLE ALTERNATIVES TO TERMINATION.— 

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

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1 visions of this subsection, the corporation shall 

2 consult with the plan participants and (in the 

3 case of a plan maintained pursuant to a collec4 tive bargaining agreement) the employee orga5 nization representing plan participants for pur6 poses of collective bargaining to determine 

7 whether there are any reasonable available al8 ternatives to termination (including, but not 

9 limited to, alternatives described subparagraph 

10 (B). 

11 ‘‘(B) REASONABLE ALTERNATIVES TO

12 TERMINATION.—The reasonable alternatives to 

13 termination referred to in subparagraph (A) 

14 consist of measures which are in the best inter15 est of plan participants and which include (but 

16 are not limited to) the following: 

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

18 member of the plan sponsor’s controlled 

19 group, with or without assistance from the 

20 corporation, in order to obtain plan financ21 ing, including back-up guarantees to any 

22 such financing which the corporation is 

23 hereby authorized to provide for such pur24 pose. 


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

2 the parties, such as transfer of plan liabil3 ities to multiemployer plans, new benefit 

4 formulas for new hires or non-vested par5 ticipants, or other plan restructuring alter6 natives agreed to by the parties. 

7 ‘‘(iii) Reinsurance which the corpora8 tion is hereby authorized to obtain for the 

9 plan. 

10 ‘‘(iv) An agreement by the parties au11 thorizing alternative funding schedules, ap12 proved by the corporation, which would 

13 modify plan funding, subject to the min14 imum funding requirements for the plan 

15 under part 3 of subtitle B of title I. 

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

17 an annuity contract to cover liabilities of 

18 the plan, which the corporation is hereby 

19 authorized to guarantee as necessary to se20 cure such a contract.’’. 

21 (f) NOTICE OF RIGHT TO CHALLENGE DETERMINA22 TIONS RELATING TO PLAN TERMINATION.— 

23 (1) PROCEDURE FOR STANDARD TERMI24 NATIONS.—Section 4041(b)(2)(B) of such Act (29 

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


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1 striking ‘‘and’’ at the end, in clause (ii)(V) by strik2 ing ‘‘require.’’ and inserting ‘‘require, and’’, and by 

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

4 ‘‘(iii) the right of participants and 

5 beneficiaries to challenge determinations 

6 under this section.’’. 

7 (2) TERMINATION PROCEEDINGS FOR DISTRESS

8 TERMINATIONS AND TERMINATIONS COMMENCED BY

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

10 1342(a)) is amended by adding at the end the fol11 lowing new sentence: ‘‘Prior to commencing pro12 ceedings under this section with respect to any plan, 

13 the corporation shall provide notice to plan partici14 pants and beneficiaries of the right to challenge de15 terminations under this section, written in a manner 

16 likely to be understood by the participant or bene17 ficiary.’’. 

18 SEC. 302. EFFECTIVE DATE OF TITLE. 

19 The amendments made by this title shall apply with 

20 respect to any plans undergoing termination proceedings 

21 pursuant to section 4041 or 4042 of the Employee Retire22 ment Income Security Act of 1974 which are pending on 

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


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1 TITLE IV—RECOVERY OF BEN2 EFIT LIABILITIES WHICH ARE 

3 NOT GUARANTEED 

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

5 STATES CODE. 

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

7 amended by adding at the end the following: 

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

9 and (C), allowed unsecured claims for benefit li10 abilities to participants and beneficiaries under 

11 a single-employer plan (as defined in section 

12 4001(a)(15) of the Employee Retirement In13 come Security Act of 1974) in connection with 

14 the termination of the plan, in excess of the 

15 benefits payable to the participants and bene16 ficiaries by the Pension Benefit Guaranty Cor17 poration under section 4022 of the Employee 

18 Retirement Income Security Act of 1974 in 

19 connection with such termination.’’. 

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

21 (a) EFFECTIVE DATE.—Except as provided in sub22 section (b), section 401 and the amendment made by such 

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

24 this Act. 


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1 (b) APPLICATION OF AMENDMENT.—The amendment 

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

3 commenced under title 11 of the United States Code be4 fore the date of the enactment of this Act. 

Æ 


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