To embed, copy and paste the code into your website or blog: On January 7, 2021, the Pension Benefit Guaranty Corporation (“PBGC”) issued final regulations updating its guidance under sections 4211 and 4219 of the Employee Retirement Income Security Act of 1974 (“ERISA”), which govern the calculation of an employer’s withdrawal liability and the payment of that liability, respectively. Specifically, the regulations provide simplified methods for calculating withdrawn employers’ allocable share of the plan’s unfunded vested benefits disregarding certain benefit reductions and contribution increases, as required by law. The final regulations closely follow proposed regulations that PBGC issued on February 6, 2019. Background The Pension Protection Act of 2006 (“PPA”) permits plans in critical status to reduce “adjustable benefits”, which most commonly include early retirement subsidies for participants not in pay status and benefit improvements that have been in effect for less than 5 years. In certain circumstances, PPA also provides for mandatory employer contribution rate increases and contribution surcharges. The law requires that plans disregard cuts to adjustable benefits when calculating an employer’s withdrawal liability, and directs PBGC to provide simplified methods for implementing this requirement. Additionally, PPA specifies that employer surcharges are disregarded when allocating unfunded vested benefit liabilities to a withdrawn employer.