Information to Be Supplied to Employers and Unions Upon Written Request
The Pension Protection Act of 2006 (“PPA”) has expanded the disclosure requirements to not only participants and beneficiaries, but to employers and unions.
Specifically, the PPA added ERISA Sections 101(k), 101(l) and 104(d).
To assist the Fund Office in reviewing requests for information from employers, we developed an outline of the disclosure categories/documents. All requests for information must be submitted in writing to the Fund Office.
Pursuant to ERISA §101(l), the Pension Fund must provide an estimate of an employer’s potential withdrawal liability and an explanation of how such estimated liability amount was determined. The Pension Fund must provide said information within 180 days after receiving such a request. Each employer is entitled to an estimate upon request once every 12 months.
ERISA §101(k) requires multiemployer plans to furnish the following information to any plan participant or beneficiary, employee representative or any employer that has an obligation to contribute to the plan: (1) any periodic actuarial report; (2) any quarterly, semi-annual or annual financial report prepared for the plan by any plan investment manager or advisor or other fiduciary; and (3) any application filed with the Secretary of the Treasury requesting an amortization extension and the determination of such application. Said information under ERISA§101(k) must be provided within 30 days after such a request is received and exclude individually identifiable information or proprietary information.¹ Again, a participant, beneficiary, employer or union is entitled to such information upon request once every 12 months.
Pursuant to ERISA §104(d), within 30 days after the due date for filing the annual report (Form 5500), multiemployer plans must furnish each employee organization and each employer with an obligation to contribute to the plan a report that contains a summary of plan information. Disclosure of this report applies to plan years commencing on or after January 1, 2008, which means the 2008 Plan Year. The report must include:
(a) A description of the contribution schedules and benefit formulas and any modifications to them during the plan year;
(b) The number of employers obligated to contribute to the plan;
(c) A list of employers that contributed more than 5% of the total contributions to the plan during the plan year;
(d) The number of participants under the plan on whose behalf no contributions were made by an employer during the plan year and for each of the two preceding plan years;
(e) Whether the plan was in critical or endangered status for the plan year and if so, a list of the actions taken by the plan to improve its funding status and how an employer or union can obtain a copy of the plan’s funding improvement or rehabilitation plan and the actuarial and financial data that demonstrate any action taken by the plan toward fiscal improvement;
(f) The number of employer withdrawals in the previous plan year and the aggregate amount of withdrawal liability assessed or estimated to be assessed;
(g) In the case of plan mergers during the year, the actuarial valuation of the assets and liability of each affected plan as of the end of the prior plan year;
(h) A statement as to whether the plan sought or received an amortization extension or used the shortfall method for the plan year; and
(i) Notification that any employer or union can receive a copy of the plan’s annual report (Form 5500), summary plan description, summary of any material modification, upon written request and that said recipient is entitled to only one copy of any such document during any 12-month period and that the plan may make a reasonable charge for the cost of copying, mailing and otherwise furnishing the material.
Under these expanded disclosure requirements, in our opinion, the following documents must be disclosed to employers who request said information in writing:
1- General information necessary for Employer to compute its withdrawal liability (provided without charge);
2- Estimate of Employer’s potential withdrawal liability and an explanation of how such estimated liability Amount was Determined²
3- Annual Actuarial Valuation Report;
4- Quarterly, Semi-Annual or Annual Financial Reports prepared by Investment Consultant or Investment Manager (excluding individually identifiable information and proprietary information);
5- Annual Audited Financial Statement;
6- Annual Withdrawal Liability Report;
7- Form 5500;
8- Plan and Amendments;
9- Summary Plan Description;
10- Summary of Material Modifications;
11- Trust Agreement and Amendments;
12- Summary of plan information required by ERISA §104(d) (see list above); and
13- Any application filed with the Secretary of the Treasury requesting an amortization extension and the determination of such application.
The Trust Funds may charge a reasonable amount for copying, mailing and other costs of furnishing copies of information provided.
If you have any questions or comments about the disclosure requirements, either in general or as specific requests arise, please do not hesitate to contact us.
¹ Pursuant to ERISA§101(k), the information shall not include any individually identifiable information regarding any plan participant, beneficiary, employee, fiduciary, or contributing employer, or reveal any proprietary information regarding the plan, any contributing employer, or entity providing services to the plan.
² ERISA §101(l) provides that an employer can get notice of (a) estimated amount of employer’s withdrawal liability as if the employer withdrew on the last day of the plan year preceding the date of the request; and (b) an explanation of how much such estimated liability amount was determined including the actuarial assumptions and methods used to determine the value of the plan liabilities and assets, the data regarding employer contributions, unfunded vested benefits, annual changes in the plan’s unfunded vested benefits and the application of any relevant limitations on the estimated withdrawal liability.