January 2, 2020 / 11:56 PM / 24 days ago

Interest on withdrawal liability under ERISA can't be retroactive - 2nd Circuit

A U.S. appeals court on Thursday said the amount of money employers owe when they withdraw from underfunded multiemployer pension plans must be calculated using the interest rate in effect at the time, and not a different one imposed retroactively.

A unanimous three-judge panel of the 2nd U.S. Circuit Court of Appeals said there must be a “degree of stability” concerning the liability employers face under the Employee Retirement Income Security Act of 1974 (ERISA) when they withdraw from retirement plans, and holding otherwise could encourage plans to engage in “manipulation and bias.”

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