Description
The coronavirus pandemic has significantly impacted many businesses, forcing them to furlough or lay off their employees. These furloughs and extended layoffs may trigger a full or partial withdrawal from multiemployer pension plans, which can lead to significant liability. For companies with single-employer pension plans, furloughs and layoffs could lead to “shutdown liability,” resulting in additional contributions required to be made to the plan. In both scenarios, the resulting liabilities are joint and several obligations of the employer’s controlled group.
Employers must act to mitigate these risks. This means having a complete understanding of the applicable rules regarding withdrawal and shutdown liability and how furloughs or layoffs might give rise to liability. Employers should consider structuring furloughs and layoffs in a way that decreases the risk of incurring significant liability during an already challenging time.
Employers faced with furloughs or layoffs should also consider issues relating to their health and welfare plans, such as whether they are required to offer COBRA coverage, whether they can subsidize premium payments, and whether employees may change their existing elections.
Justin S. Alex, Senior Counsel at Proskauer Rose, Katherine B. Kohn, Of Counsel at Groom Law Group, and Emily C. Lucco, Associate at Groom Law Group, will guide employee benefits counsel on potential pension withdrawal and shutdown liability issues and other legal implications of furloughs and layoffs.
Presented By
Mr. Alex is a member of the firm's Employee Benefits & Executive Compensation Group. He advises private and public companies on all aspects of their employee benefits and executive compensation arrangements and plans, including the treatment of such arrangements and plans in corporate financings and transactions. In addition, he spends a significant portion of his time advising employers and financial sponsors with respect to underfunded single-employer and multiemployer pension plans. Previously, he was a lawyer in the Office of Chief Counsel at the Pension Benefit Guaranty Corporation, where he gained significant experience with pension termination and underfunding issues. He also represented the PBGC in corporate bankruptcies and federal court litigation.
Ms. Kohn is a partner in the firm’s Employee Benefits & Executive Compensation group. She counsels small businesses, Fortune 500 companies, nonprofits, individual owners, boards of directors, unsecured creditors’ committees and plan sponsors on qualified and nonqualified retirement plans, multiemployer (union) plans and health plans with a specific focus on bankruptcies, mergers and acquisitions and corporate planning. Ms. Kohn assists her clients in finding practical and valuable solutions regarding plan mergers and spinoffs, plan de-risking transactions, plan terminations, plan corrections, overfunded plans and corporate transactions and reorganizations involving retirement and health plans. She also counsels her clients on matters related to multiemployer plan issues, including withdrawal liability and benefits litigation. Ms. Kohn advises private funds and benefit plan investors on ERISA compliance issues, particularly with regard to disclosure, plan investment issues and negotiations.
Ms. Lucco advises clients on a variety of health law matters, counseling plan sponsors, insurers, and third-party administrators on a broad array of issues relating to ERISA, COBRA, the ACA, and the Mental Health Parity and Addiction Equity Act. She also advises clients on compliance issues related to wellness programs under HIPAA, the Americans with Disabilities Act, and the Genetic Information Nondiscrimination Act. Ms. Lucco represents employers designing health plans as well as insurers designing new products. Recently she has helped insurers conduct internal ACA audits of their business. She has also been involved in helping both employers and insurers defend government investigations.
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This 90-minute webinar is eligible in most states for 1.5 CLE credits.
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Date + Time
- event
Thursday, July 30, 2020
- schedule
1:00 p.m. ET./10:00 a.m. PT
- Impact of COVID-19 on retirement plan administration
- Overview of multiemployer pension plans
- Legal implications of furloughs and layoffs
- Litigation, arbitration, and settlement approaches
The panel will review these and other key issues:
- Critical questions to consider in the event of extended furloughs or layoffs
- Rules associated with partial and complete withdrawals that may apply in the event of furloughs or layoffs
- Legal trigger for shutdown liability
- Consequences of temporary or permanent reductions in pension plans
- Impact of joint and several controlled group exposure
- How furloughs or layoffs impact health and welfare benefits
- Best practices for employers, administrators, and employee benefits counsel
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