Source: https://www.federalregister.gov/documents/2015/08/19/2015-20505/pendency-for-request-for-approval-of-special-withdrawal-liability-rules-the-service-employees
Timestamp: 2018-04-22 06:26:40
Document Index: 89700558

Matched Legal Cases: ['§\u20094203', '§\u20094041', '§\u20094203', '§\u20094203', '§\u20094208', '§\u20094203', '§\u20094208', '§\u20094203', 'art 4203', '§\u20094041', '§\u20094203']

Federal Register :: Pendency for Request for Approval of Special Withdrawal Liability Rules: The Service Employees International Union Local 1 Cleveland Pension Plan
A Notice by the Pension Benefit Guaranty Corporation on 08/19/2015
80 FR 50339
2015-20505
https://www.federalregister.gov/d/2015-20505 https://www.federalregister.gov/d/2015-20505
This notice advises interested persons that the Pension Benefit Guaranty Corporation (“PBGC”) has received a request from the Service Employees International Union Local 1 Cleveland Pension Plan for approval of a plan amendment providing for special withdrawal liability rules. Under section 4203(f) of the Employee Retirement Income Security Act of 1974 and PBGC's regulation on Extension of Special Withdrawal Liability Rules, a multiemployer pension plan may, with PBGC approval, be amended to provide for special withdrawal liability rules similar to those that apply to the construction and entertainment industries. Such approval is granted only if PBGC determines that the rules apply to an industry with characteristics that make use of the special rules appropriate and that the rules will not pose a significant risk to the pension insurance system. Before granting an approval, PBGC's regulations require PBGC to give interested persons an opportunity to comment on the request. The purpose of this notice is to advise interested persons of the request and to solicit their views for it.
Bruce Perlin (Perlin.Bruce@PBGC.gov), 202-326-4020, ext. 6818 or Jon Chatalian (Chatalian.Jon@PBGC.gov), ext. 6757, Office of the Chief Counsel, Suite 340, 1200 K Street NW., Washington, DC 20005-4026; (TTY/TDD users may call the Federal relay Start Printed Page 50340service toll-free at 1-800-877-8339 and ask to be connected to 202-326-4020.)
For construction industry plans and employers, § 4203(b)(2) of ERISA provides that a complete withdrawal occurs only if an employer ceases to have an obligation to contribute under a plan and the employer either continues to perform previously covered work in the jurisdiction of the collective bargaining agreement, or resumes such work within five years without renewing the obligation to contribute at the time of resumption. In the case of a plan terminated by mass withdrawal (within the meaning of ERISA § 4041(A)(2)), § 4203(b)(3) provides that the five year restriction on an employer resuming covered work is reduced to three years. Section 4203(c)(1) of ERISA applies the same special definition of complete withdrawal to the entertainment industry, except that the pertinent jurisdiction is the jurisdiction of the plan rather than the jurisdiction of the collective bargaining agreement. In contrast, the general definition of complete withdrawal in § 4203(a) of ERISA includes the permanent cessation of the obligation to contribute regardless of the continued activities of the withdrawn employer.
Congress also established special partial withdrawal liability rules for the construction and entertainment industries. Under § 4208(d)(1) of ERISA, “[a]n employer to whom § 4203(b) (relating to the building and construction industry) applies is liable for a partial withdrawal only if the employer's obligation to contribute under the plan is continued for no more than an insubstantial portion of its work in the craft and area jurisdiction of the collective bargaining agreement of the type for which contributions are required.” Under § 4208(d)(2) of ERISA, “[a]n employer to whom § 4203(c) (relating to the entertainment industry) applies shall have no liability for a partial withdrawal except under the conditions and to the extent prescribed by the [PBGC] by regulation.”
PBGC's regulations on Extension of Special Withdrawal Liability Rules (29 CFR part 4203) prescribe procedures for a multiemployer plan to ask PBGC to approve a plan amendment that establishes special complete or partial withdrawal liability rules. The regulation may be accessed on PBGC's Web site (http://www.pbgc.gov). Section 4203.5(b) of the regulation requires PBGC to publish a notice of the pendency of a request for approval of special withdrawal liability rules in the Federal Register, and to provide interested parties with an opportunity to comment on the request.
PBGC received a request, dated September 16, 2011, from the Service Employees International Union Local 1 Cleveland Pension Plan (the “Plan”), for approval of a plan amendment providing for special withdrawal liability rules. Subsequently, the Plan requested that PBGC suspend review of the amendment. On January 24, 2014, the Plan requested that PBGC again consider the amendment and provided updated actuarial information. PBGC's summary of the actuarial reports provided by the Plan may be accessed on PBGC's Web site (http://www.pbgc.gov). A copy of the complete filing may be requested from the PBGC Disclosure Officer. The fax number is 202-326-4042. It may also be obtained by writing the Disclosure Officer, PBGC, 1200 K Street NW., Suite 11101, Washington, DC 20005.
In summary, the Plan is a multiemployer pension plan currently covering employees who work in the commercial building cleaning and security industries in the greater Cleveland, Ohio area. The Plan represents in its submission that the industry for which the rule is requested—the commercial building cleaning industry—has characteristics similar to those of the construction industry. According to the Plan's submission, the principal similarity is that when a contributing employer's contract to clean a building expires, the cleaning work will generally continue to be performed by employees covered by the Plan, irrespective of the employer retained to perform the cleaning services. Under the proposed amendment, a complete withdrawal of an employer whose employees substantially all work in the commercial building cleaning industry shall occur only when: (a) The employer ceases to have an obligation to contribute under the Plan and (b) the employer continues to perform work in the jurisdiction of the Plan of the type for which contributions were previously required or resumes such work within five (5) years after the date on which the obligation to contribute under the plan ceases and does not renew the obligation at the time of the resumption. In the case of termination by mass withdrawal (within the meaning of ERISA § 4041A(a)(2)), the proposed amendment provides that § 4203(b)(3), Start Printed Page 50341the provision that allows a construction employer to resume covered work after three years of withdrawal opposed to the standard five year restriction, is not applicable to withdrawing commercial building cleaning industry employers. Therefore, in the event of a mass withdrawal, there is still a five year restriction on resuming covered work in the jurisdiction of the Plan. The request includes the actuarial data on which the Plan relies to support its contention that the amendment will not pose a significant risk to the insurance system under Title IV of ERISA.
Issued in Washington, DC, on this 12th day of August, 2015.
[FR Doc. 2015-20505 Filed 8-18-15; 8:45 am]