Is Your Organization Contributing To A Multi-Employer Pension Plan?

A number of employers who contribute to multi-employer pension plans do not know that their financial liability is not limited to the contribution they undertook to pay in the collective agreement. The current financial situation of pension plans could result in a rude awakening.

Multi-employer pension plans are generally set up by a union and participating employers undertake to contribute to the plan in their collective agreements with the union. Many of these plans are both defined benefit and defined contribution plans in the sense that the plan promises a pension (defined benefit) financed by contributions payable pursuant to the collective agreements. For purposes of the Supplemental Pension Plans Act ("SPPA"), this type of plan is treated as a defined benefit plan.