US - Multi-employer plans in the US overburdened by crippling expenses after the withdrawal of member companies may be allowed to merge to save costs and receive help from the Pension Benefit Guaranty Corp. under a new bill offered by a Democratic senator.
Senator for Pennsylvania Bob Casey has proposed that the PBGC subsidises the participants of employers who withdraw from a multi-employer plan.
In addition, Casey's bill, the Create Jobs and Save Benefits Act, would allow multi-employer pension funds to "combine resources for the purposes of reducing administrative costs".
This, he said, will protect the pensions of workers whose employers collapse.
In addition, the move will "unburden companies stuck paying a crippling expense that threatens its existence and the jobs of its employees".
He added: "As more companies leave the pension plan, the costs left to the remaining companies increase to cover the pension benefits of all employees covered by the plan.
"Companies still contributing to the plans also run the risk of bankruptcy because of the additional burden of being forced to pay for the pensions of the employees of other companies," he added.
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