Withdrawal Liability

Definition

The amount of money an employer owes to a multiemployer pension plan when it stops participating in (withdraws from) the plan. It represents the employer's proportionate share of the plan's unfunded pension obligations, designed to prevent remaining employers from bearing the full cost of the departing employer's promised benefits.

Examples

• •The four petitioner employers were assessed approximately $10 million in total withdrawal liability after leaving the IAM National Pension Fund.

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