The Pension Benefit Guaranty Corporation approved a special financial assistance program from a local sheet metal workers’ pension plan in Massillon, Ohio, on Wednesday.
The plan covered 1,649 sheet metal trade participants. About 850 of them saw their benefits reduced by an average of 24% in May 2020 under the Multi-Employer Pension Reform Act 2014. The SFA will pay $28.8 million to make up the shortfall.
The MPRA has allowed trustees of multi-employer plans to submit a request to the Treasury Department to reduce pension payments if such a reduction is necessary to prevent the fund from running out of money.
Labor Secretary Marty Walsh explained: “The special financial assistance approved today means that these 1,649 construction workers and retirees will receive the full pension benefits they have earned. Since 2020, they have been receiving reduced pension benefits through no fault of their own. »
The SFA program was adopted as part of the American Rescue Plan Act. The Act provided funding for troubled multi-employer pension plans. To date, PBGC has approved nearly $7.8 billion for plans covering 156,000 people.
In order to receive funds from SFA, plan administrators must monitor the money they receive as well as investment income separately from other funds. It also requires the funds to invest the money only in high quality bonds.
The National Pension Fund for Sheet Metal Workers did not return a request for comment.
Tags: Department of Labor, PBGC