Outlook Improves for Multiemployer Reform in 2021, 2022
Democratic control of Congress could help break the deadlock over passing legislation to protect pensions and the PBGC.
There’s an improved chance Congress will pass legislation over the next year or two to prevent multiemployer pension plans and the Pension Benefit Guaranty Corporation (PBGC)’s multiemployer insurance program from becoming insolvent, according to law firm Morgan Lewis.
In a blog post on the firm’s website, Morgan Lewis Senior Director Timothy Lynch and Partner Daniel Salemi wrote that the biggest factor that could lead to a legislative solution is the fact that the Democratic Party controls the White House and both houses of Congress. They also say the Biden administration may see greater urgency in moving for a solution due to the major economic fallout that would occur if PBGC’s multiemployer program were to become insolvent in 2026, as is currently projected.
Fire Fighters Union Boss Schaitberger Accused of Skimming $6M
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Harold Schaitberger (in photo), longtime head of the International Association of Fire Fighters (IAFF), has a reputation for wielding unchallenged power. But that power soon may dissipate in the wake of a memo prepared by the union’s number-two man. On March 20, IAFF Secretary-Treasurer Edward Kelly circulated a 105-page internal memorandum accusing Schaitberger and Kelly predecessor Thomas Miller of misusing or outright stealing about $6 million in union funds, especially pension assets. The memo, which followed an outside audit, also accuses Schaitberger of concealing these losses from the union executive board. Schaitberger disputes the charges, calling them “reckless and destructive.” But the IRS, the Department of Labor and the U.S. Attorney’s Office are conducting a probe that may conclude otherwise.
On January 12, 2021, the Department of Labor (DOL) released a triple shot of guidance related to helping retirement plan fiduciaries meet their obligations under the Employee Retirement.
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The ongoing effort to provide relief for troubled multiemployer pension plans took many twists and turns in 2020, and the year ended once again without an agreed-upon solution. Looking forward to 2021, the incoming Biden administration and the new 117th Congress will continue to grapple with how best to avoid the looming insolvency of both the Pension Benefit Guaranty Corporation’s (PBGC) multiemployer pension insurance program and a growing number of plans in critical and declining status.
Over the past two years, several proposed solutions were put forward. One of the first legislative initiatives to receive congressional support was HR 397, the Rehabilitation for Multiemployer Pensions Act, a federally-backed loan program for ailing plans. Better known as the “Butch-Lewis” Act, HR 397 passed the House of Representatives in July 2019 by a 264-169 vote, including 29 Republican House members. Although there was a co
Carpenters in Detroit denounce draconian pension cuts proposed under 2014 federal law
The general assault on the pensions of US workers under the Obama era Kline-Miller Multiemployer Pension Reform Act of 2014 has now taken aim at the pensions of tens of thousands of construction workers in southeast Michigan. Nearly 20,000 active and retired carpenters and millwrights in the Detroit metropolitan area are facing deep cuts in their pensions in July 2021.
The Warren, Michigan-based Carpenters and Millwrights fund submitted a revised application in 2020 to Treasury Secretary Steven Mnuchin under the Application for Suspension of Benefits required by the 2014 federal legislation. The current Board of Trustees includes now president of the Michigan Regional Council of Carpenters and Millwrights, Mike Barnwell, and other officials of the carpenters and millwrights regional and local unions.