Most unionized hospitality employers have collective bargaining agreements which require contributions to multiemployer pension funds. In recent years, many of these pension funds have slipped into “endangered” or even “critical” status, and employers who have exited these funds have been hit with substantial assessments of withdrawal liability. These assessments often amount to millions of dollars in withdrawal liability.
Many employers are unfamiliar with the complicated procedures for contesting an assessment of withdrawal liability from a multiemployer pension fund. As a result, pension funds win a substantial percentage of litigated cases on procedural technicalities.
EBG partner Mark M. Trapp recently wrote an article entitled “Going Through Withdrawal: A Step-By-Step Guide to Arbitration in Multiemployer Withdrawal Liability Disputes” which appears in the current issue of the ABA Journal of Labor & Employment Law (members only).
Mark’s thoroughly researched and straightforward article sheds some light on a process unfamiliar to most employers, and provides a step-by-step guide to challenging assessments. Going Through Withdrawal can be used as a reference guide to ensure that hospitality employers faced with an assessment of withdrawal liability avoid missteps that could cost millions. As Mark notes in his article:
Successfully challenging an assessment of withdrawal liability is difficult enough without making any unforced errors. By avoiding procedural mistakes, a knowledgeable employer can keep the focus of the proceedings on the merits of the fund’s assessment and maximize its chances of prevailing.
The full article can be accessed here.