[firm] blog logo

Employer Exempt from Withdrawal Liability

The Seventh Circuit Court of Appeals upheld an arbitrator?ÇÖs decision that Georgia-Pacific?ÇÖs withdrawal from the Central States, Southeast and Southwest Areas Pension Fund was ?Ç£solely?Ç¥ because of its arms-length sale of assets to a third party, where the purchaser assumed liability for the plan?ÇÖs contributions and posted a bond to ensure payment. In one of the first appellate court decisions to interpret the phrase ?Ç£solely because?Ç¥ in 29 U.S.C. ?º1384 (ERISA ?º4204), the Court stated that ?Ç£. . .the best understanding of this phrase is one that concentrates on the transaction at issue: If the sale had not occurred, everything else has remained the same, and no withdrawal liability would have accrued, then the sale to a buyer that continues the pension contributions does not entail withdrawal liability.?Ç¥ The Court cautioned that if an employer completes its withdrawal in stages, with a sale being the last step, then all transactions… Continue Reading

April 2011
S M T W T F S
 12
3456789
10111213141516
17181920212223
24252627282930

Archives