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Our Perspective

Multiemployer Plan Withdrawal Liability: DC Circuit Says Discount Rate Used for Withdrawal Liability Must be Similar to Discount Rate Used for Funding

On July 8, 2022, a three-judge panel of the DC Circuit Court of Appeals reversed the decision of a lower court in United Mine Workers of America 1974 Pension Plan v. Energy West Mining Company, ordering that the discount rate used to calculate multiemployer pension plan withdrawal liability must be similar to the discount rate the Enrolled Actuary uses in performing funding calculations for the plan. In doing so, the DC Circuit joins the Sixth Circuit (see our article Multiemployer plan withdrawal liability: Sixth Circuit strikes down “Segal Blend”) in coming to this conclusion. This is welcome news for contributing employers that withdraw from multiemployer pension plans.

July 2022 Annuity Purchase Update

Annuity Purchase interest rates hit a record high as of July 1 2022, with the average duration 7 and 15 rates over 4%.

July 2022 legislative update – review of key bipartisan retirement policy reform proposals

On March 29, 2022, the House of Representatives, by a 414-5 vote, approved the Securing a Strong Retirement Act of 2022 (SECURE 2.0), a synthesis of the Ways and Means Committee’s Securing a Strong Retirement Act of 2021 and the Education and Labor Committee’s RISE Act. On June 14, 2022, the Senate Health, Education, Labor, and Pensions (HELP) Committee, by a voice vote, passed the Retirement Improvement and Savings Enhancement to Supplement Healthy Investments for the Nest Egg Act (the RISE & SHINE Act). And, on June 22, 2022, the Senate Finance Committee unanimously approved the Enhancing American Retirement Now (EARN) Act. In what follows we provide a brief summary of certain key provisions of these three bills.

June 2022 Pension Finance Update

Stocks tumbled again in June, driving the worst month of the year for pension finance. Both model plans1 we track lost ground last month: Plan A lost more than 3% but remains up 2% for the year, while the more conservative Plan B lost 1%, ending the first half of 2022 down 1%

Senate Finance Chair releases outline of broad, bipartisan retirement legislation

On June 17, 2022, Senate Finance Committee Chair Ron Wyden (D-OR) released an outline of the bipartisan Enhancing American Retirement Now (EARN) Act. The Committee is expected to take up this legislation beginning the week of June 20. The EARN Act, together with the Retirement Improvement and Savings Enhancement to Supplement Healthy Investments for the…Read More

Annuity Purchase Update – June 2022

Annuity Purchase interest rates hit a record-setting high in June, with the average duration 7 rate at 3.82% and average duration 15 rate at 3.87%.

Which participants can sue?

A number of recent cases have addressed the issue of which participants have “standing” to bring an ERISA fiduciary action against plan fiduciaries. The cases generally focus on the issue of whether the participant-plaintiffs have a “concrete stake” in the dispute. In what follows, we discuss two recent cases involving participant-plaintiffs in defined contribution plans…Read More

May 2022 Pension Finance Update

Financial markets continued to roil in May, but the net impact on pension finance was modest. Both model plans1 we track were close to even on the month. Through the first five months of 2022, Plan A remains up 4%-5% while the more conservative Plan B is holding at even on the year: Assets Stocks…Read More

IRS proposes new regulations/mortality tables for DB valuations

On April 28, 2022, the IRS published proposed regulations/mortality tables for determining the present value of benefits under defined benefit plans for purposes of determining the plan’s ERISA minimum funding requirements, Pension Benefit Guaranty Corporation variable-rate premiums, and lump-sum valuations.