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Treasury Department Rejects Central States Pension Fund's Benefit Reduction Proposal

Treasury Department Rejects Central States Pension Fund's Benefit Reduction Proposal

Federal Court Finds Private Equity Funds Liable for Pension Liabilities of Portfolio Company

In a much-anticipated decision addressing the reach of multiemployer pension plans in imposing withdrawal liability, a U.S. District Court ruled on March 28, 2016 that three private equity funds were engaged in a “trade or business” and their investment in a portfolio company was made through a “partnership-in-fact,” thereby subjecting the funds to withdrawal liability. The ruling in Sun Capital Partners III, LP v. New England Teamsters & Trucking Indus. Pension Fund by the U.S. District Court for the District of Massachusetts comes almost three years after the high-profile decision of the U.S. Court of Appeals for the First Circuit that one of the funds managed by Sun Capital Advisors (“Sun Capital”) was engaged in a “trade or business,” setting the stage for the district court’s recent decision.

IRS Proposes Permanent Nondiscrimination/Coverage Relief for Closed Pension Plans

The Internal Revenue Service (IRS) has issued proposed regulations that would provide permanent relief from certain coverage and nondiscrimination testing requirements to defined benefit plans that are closed to new participants, but that provide ongoing accruals to “grandfathered” employees, i.e. some or all employees who were participants in the plan as of a specified date. In recent years, many employers have closed their defined benefit plans to new participants except to groups of grandfathered employees, who continue accruing benefits in the closed plan (this is often referred to as a “soft freeze”). Over time, a soft-frozen plan may become more concentrated with highly-compensated employees (since longer-service employees tend to be higher paid on average). This often makes it difficult for closed plans to pass the Internal Revenue Code’s nondiscrimination/coverage testing requirements.

Pension Funding Relief Legislation Becomes Law

On Friday, the Moving Ahead for Progress in the 21st Century Act, or “MAP-21” Act, became law. The Act increases the interest rates that are used for valuing single-employer, non-governmental pension liabilities. For many pension plan sponsors, this will significantly reduce the amount of required annual contributions in the short term. And in some cases, plan sponsors that are currently restricted from paying lump sum distributions to participants will be able to remove those restrictions.

Retirement Plan Dollar Amounts Get a Boost for 2012

The Internal Revenue Service announced the cost-of-living adjustments applicable to the dollar limitations for qualified retirement plans that will allow employees to increase their retirement savings for 2012. This Alert highlights some of the new limits, comparing the new limits to the limits of the prior seven years. Many of the limits had remained unchanged for several years, but the cost-of-living index has now met the statutory thresholds, which has triggered adjustments for 2012.
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Ogletree Deakins | California | The Opportunities and Obligations of Venture Capital and Private Equity in the #MeToo Environment (February 01, 2018)

Fisher Phillips | California | Glimmers of Hope? Pair of Recent PAGA Cases Provide Rare Procedural Victories for California Employers (January 31, 2018)

Ogletree Deakins | California | California’s Salary History Ban: Answers to Frequently Asked Questions (January 23, 2018)

Fisher Phillips | California | The ICEman Cometh? Recent War of Words Puts California Employers in the Crosshairs of National Immigration Debate (January 22, 2018)

Jackson Lewis P.C. | California | Trial Court Properly Denied Attorneys’ Fees To Plaintiff Who Proved His Termination Was Substantially Motivated By His Disabilities, But Was Not The Prevailing Party At Trial (January 21, 2018)

Ogletree Deakins | California | Cal/OSHA Approves Long-Awaited Housekeeper Injury Prevention Regulations (January 24, 2018)

Fisher Phillips | California | DLSE Publishes Voluntary Template for Required Employer AB 450 Notice (February 11, 2018)

Fisher Phillips | California | Cal/OSHA Approves Hotel Housekeeping Injury Standard – Likely to Go Into Effect Later This Year (January 21, 2018)

Ogletree Deakins | California | As Marijuana Shops Thrive, California Employers Revisit Drug Policies (January 18, 2018)

Jackson Lewis P.C. | California | California Labor Department Releases Form for Employers Responding to Immigration Agency Inspection (February 12, 2018)