Employer Withdrawal Activity Overview: U.S. Multiemployer Pension Plans

Multiemployer pension plans in the United States generally cover unionized participants from more than one participating employer. When an employer discontinues participation—or withdraws—from a plan, the employer stops making regular contributions and is generally assessed a withdrawal liability, which is typically paid over time. Because of a variety of statutory and practical limitations, the withdrawal liability actually paid may or may not be sufficient to cover any unfunded liabilities associated with the now-withdrawn employer.

This longitudinal study looks at the prevalence and impact of employer withdrawals. Highlights from the most recent update:

  • The annual percentage of withdrawing employers continues to decline, and the percentage of plans experiencing employer withdrawal also continues to decrease. The percentage of withdrawing employers dropped from 1.49% in 2009 to 0.85% in 2016, and the percentage of plans that experienced withdrawal fell from 18.5% in 2009 to 15.1% in 2016. However, at 60%, the percentage of participants in plans that experienced withdrawal was the same in 2009 and 2016, although the percentage slowly increased to 67% in 2013 before slowly declining to 2016.
  • On average over 2009–2016, assessed withdrawal liabilities were 0.4% of aggregate plan liabilities for zone determination. But the impact on individual plans varied widely. While over half of plans’ assessed withdrawal liabilities were less than one-tenth of 1% of plan liabilities, 1% of plans that experienced withdrawal saw assessed withdrawal liabilities of more than 10% of plan liabilities.
  • Dependency ratios continued to generally increase among multiemployer plans, and plans that experienced withdrawal continued to have a significantly higher dependency ratio than plans that did not. On average over 2009–2016, plans that experienced withdrawal had dependency ratios of 181%, compared to 145% among plans that did not experience withdrawal.


March 2019 Update

January 2018 Update

January 2017 Update

December 2015 Overview

Employer Withdrawal Overview Fast Facts

Research Insights – U.S. Multiemployer Pension Updates

Thank You

The authors thank the following volunteers for their thoughtful arm’s-length review of the most recent study update prior to publication. Any opinions expressed may not reflect their opinions or those of their employers. Any errors belong to the authors alone.

Christian E. Benjaminson, FSA, EA, FCA, MAAA

James B. Dexter, FSA, EA, FCA, MAAA

Paul B. Dunlap, FSA, EA, FCA, MAAA

Joshua P. Kaplan, FSA, EA, FCA, MAAA

Questions or Comments?

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