The U.S. Department of Labor has proposed a regulation to impose fines on sponsors of multiemployer defined benefit pension plans under financial stress if they fail to act to correct their problems.
The Pension Protection Act of 2006 amended the Employee Retirement Income Security Act and the Internal Revenue Code to require any plan certified to be endangered or critical to adopt a remedial plan within 240 days of the certification. Under the PPA, the DOL can assess civil monetary penalties of up to $1,100 per day against plan sponsors that fail to file a rehabilitation or improvement plan on time, the DOL points out.
The proposed regulation lays down procedures for assessing and disputing such penalties. The rule, “Civil Penalties Under ERISA Section 502(c)(4,)” was published in the Sept. 4 Federal Register. To view it, click here.