Congress last year passed legislation that allows trustees of some multiemployer pension plans to submit proposals for benefit reductions; the process is designed to give funding relief to the country’s most troubled private plans.
This week, renowned mediator Kenneth Feinberg was appointed to review those proposed benefit cuts and ensure their legality under the recently passed law.
More from the Wall Street Journal:
Under the new law, trustees of many troubled plans will propose benefit cuts to stave off insolvency. Mr. Feinberg’s job will be to review the applications to make sure they comply with the new law’s conditions.
The choice of Mr. Feinberg is aimed at reassuring workers and retirees that they will be treated fairly in the painful process. He termed it a “very, very difficult, challenging assignment,” in a conference call on Wednesday morning.
[…]
Under the legislation, plan participants can vote to disapprove a benefit cut that is proposed by a plan’s trustees. But any vote disapproving a cut could be overridden for a plan that poses a threat to the federal safety net.
The process set up by last year’s legislation likely won’t end the problems. The federal safety-net agency for private pensions, the Pension Benefit Guaranty Corp., last year projected its long-term deficit for multiemployer plans to be about $42 billion.
Mr. Feinberg is reportedly doing the job pro-bono.
Photo by Bob Jagendorf via Flickr CC License
