Changes to Multiemployer Pension Plans
On December 16, 2014, the Kline-Miller Multiemployer Pension Reform Act of 2014 (Kline-Miller) was enacted into law. In Kline-Miller, Congress established a new process for multiemployer pension plans to propose a temporary or permanent reduction of pension benefits if a plan is projected to run out of money before paying all promised benefits.
Kline-Miller requires the Treasury Department, in consultation with the Pension Benefit Guaranty Corporation (PBGC) and the Department of Labor, to review a multiemployer pension plan’s application to reduce benefits and determine whether it meets the requirements set by Congress.
It is important to note that most multiemployer pension plans are sufficiently funded and will not be eligible to apply for a reduction of pension benefits under Kline-Miller. To find out if Kline-Miller could impact you, contact your pension plan.
The resources on this page provide additional information about Kline-Miller and the Treasury Department’s process for reviewing applications to reduce benefits paid by multiemployer pension plans that are in critical and declining status.
On May 6, 2016, Secretary Lew sent a letter to Congress regarding the Kline-Miller Multiemployer Pension Reform Act of 2014. You can view that letter here.
CENTRAL STATES DECISION (UPDATED 5/06/2016):
On May 6, 2016, the Department of the Treasury issued its decision on the Central States Pension Plan’s application to reduce pension benefits under the Kline-Miller Multiemployer Pension Reform Act of 2014. The letter notifying Central States of this decision can be viewed here.
FINAL REGULATIONS RELEASED (UPDATED 4/26/2016):
On April 26, 2016, the Treasury Department released final regulations implementing the Kline-Miller Multiemployer Pension Reform Act (Kline-Miller). These regulations finalize the proposed and temporary regulations that were issued in June 2015 and September 2015 and address stakeholder comments.
The final regulations do not change the basic requirements for applications to reduce pension benefits. They provide further clarifications based on information received during the public comment period. The final regulations can be viewed online here.
TWO NEW KLINE-MILLER APPLICATIONS (UPDATED 02/02/2016):
Treasury has posted
Teamsters 469 and IW Local 17 applications on its website. Treasury has also published a notice in the Federal Register soliciting public comments for Teamsters 469 here
and IW Local 17 here
. If you wish to submit a public comment electronically, you can click here
for Teamsters 469 and here
for IW Local 17 to comment via the Federal Register Notice through March 14, 2016.
APPLICATION FROM CENTRAL STATES PENSION PLAN (UPDATED 1/05/16):
The Treasury Department has received an application under Kline-Miller from the Board of Trustees of the Central States, Southeast and Southwest Areas Pension Plan (Central States Pension Plan).
Treasury has posted the application on this website. Treasury has also published a notice in the Federal Register soliciting public comments on the application from plan participants and other interested parties. If you wish to submit a public comment electronically, you can click here to comment via the Federal Register Notice through February 1, 2016.
CONFERENCE CALLS WITH PLAN PARTICIPANTS
In order to provide additional opportunities for plan participants to provide feedback, Treasury is hosting regular conference calls on the Central States application every Monday.
Treasury is hosting a series of public sessions for individuals who would be impacted by the Central States Pension Plan’s application to reduce pension benefits under the Kline-Miller Multiemployer Pension Reform Act of 2014. These sessions are an opportunity for the public to provide input on the application. The sessions will be hosted by Kenneth Feinberg, Special Master for the Treasury Department’s implementation of Kline-Miller, and are part of our broader efforts to gather feedback from plan participants and other stakeholders.
***As of February 16, 2016, Treasury has concluded the series of regional public sessions for individuals who would be impacted by the Central States Pension Plan’s application. Read a message about these sessions and other outreach from Kenneth Feinberg, Special Master for the Treasury Department’s Implementation of Kline-Miller.***
Past public sessions on the Central States Pension Plan’s application:
February 16, 2016 – Kansas City, Missouri
February 9, 2016 – Minneapolis, Minnesota
February 8, 2016 – Detroit, Michigan
January 21, 2016 – Indianapolis, Indiana
January 14, 2016 – Peoria, Illinois
January 11, 2016 – Greensboro, North Carolina
December 9, 2015 – Milwaukee, Wisconsin
December 8, 2015 – Columbus, Ohio
If you are a participant in the Central States Pension Plan, the plan's Board of Trustees is required to provide notice of the application to reduce benefits to you. That notice is also required to include an individualized estimate of the effect of the proposed benefit reductions on you. If you have questions about how proposed benefit reductions will specifically impact you, please contact the plan administrator. Contact information for the plan administrator is available in the Central States Pension Plan summary plan description.
Under Kline-Miller, Treasury is responsible for determining whether the application for a reduction of benefits meets the requirements set by Congress. Benefits cannot be reduced until after the following actions take place:
- The plan sponsor must notify participants and beneficiaries of the application for a benefit reduction and provide an individualized estimate of reduced benefits
- Participants and beneficiaries must have an opportunity to comment on the application
- Treasury must review and, if the application satisfies all of the Kline-Miller requirements, must approve the application
- Participants and beneficiaries must have an opportunity to vote on the benefit reduction
Treasury has up to 225 days to approve or deny an application, and, if an application is approved, 30 days to administer a vote on the proposed benefit reductions.