Legal Issues in Terminations of Single-Employer Pension Plans: Beck v. PACE International Union (CRS Report for Congress)
| Release Date |
Revised Nov. 14, 2007 |
| Report Number |
RS22635 |
| Report Type |
Report |
| Authors |
Jennifer Staman and Erika Lunder, American Law Division |
| Source Agency |
Congressional Research Service |
| Older Revisions |
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Summary:
The Beck v. PACE International Union case concerned the decision by an employer in bankruptcy proceedings to terminate its pension plans. The employer, which was both plan sponsor and administrator, had the option of terminating the plans by buying annuities for plan participants and beneficiaries or by merging the plans with a multiemployer plan. It chose the annuity option. At issue in Beck was whether the employer breached the fiduciary duty owed under the Employee Retirement Income Security Act (ERISA) to plan participants and beneficiaries by failing to adequately consider the merger proposal. The Supreme Court found that the employer did not breach its fiduciary duty in failing to consider PACE's merger proposal, because merger is not a permissible form of plan termination under ERISA. This report discusses the Beck case and will be updated as events warrant.
