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Regulation and Compliance > Federal Regulation

PBGC Proposes Rules For Facility Closings

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NU Online News Service, Feb. 25, 2005, 4:08 p.m. EST

The federal pension insurance agency wants to standardize the rules that apply when an employer shuts down a large facility.[@@]

The agency, the Pension Benefit Guaranty Corp., requires companies that leave multi-employer pension plans to contributes extra cash to the PBGC to protect the PBGC against the possibility that the departing employee may stop supporting its pension plan.

Federal law requires a large employer that shuts down a facility that employs more than 20% of its pension plan members to make a similar payment.

The proposed rule, published today in the Federal Register, would create a rule describing the procedure the PBGC has been using on a case-by-case basis to handle facility closings all along, the PBGC says.

The PBGC has posted a notice describing the proposed rule in the Federal Register at //