§1383 Complete Withdrawal

Summary

An employer is treated as having completely withdrawn from a multiemployer pension plan when it permanently stops having to pay into that plan or permanently stops all work covered by the plan. For the building and construction industry, a complete withdrawal only counts if the employer stops its payment obligation and either keeps doing the same kind of covered work in the same jurisdiction or returns to that work within 5 years and still does not restart contributions. If the plan ended because many employers withdrew, the return period is 3 years instead of 5. For employers in the entertainment industry who work mainly on temporary or project-by-project jobs, the same special rule applies but uses the plan area instead of a collective bargaining area. Entertainment industry means theater, motion pictures (with some exceptions), radio, television, sound or visual recording, music, dance, and other activities the corporation allows. For plans made mostly of long- and short-haul trucking, household goods movers, or public warehousing employers, a complete withdrawal only happens when the employer stops paying or stops covered operations and either the corporation finds serious harm to the plan’s contribution base or the employer fails to give a bond or escrow equal to 50 percent of its withdrawal liability. If a bond or escrow is given but later the corporation finds serious harm within 60 months, the bond pays the plan and the withdrawal is treated as having occurred when payments or operations stopped; if the corporation finds no liability, the bond or escrow is returned. The date of complete withdrawal is the day the payment obligation or covered operations stopped. The corporation can allow other industries to adopt similar special rules when appropriate and not risky.