What is a Multiemployer Pension Plan (“MEPP”)?

A multiemployer pension plan is an employee benefit plan that is collectively bargained and jointly administered by more than one employer and at least one labor union. The plans are generally grouped by industry or geographic area, and they exist for the purpose of pooling assets to reduce administrative costs and for advantageous investing. Employers pool money into a trust, and workers are then paid a monthly benefit during retirement based on the amount their employer put in and years worked.

There are about 1,400 multiemployer pension plans covering 10 million workers. Many participants come from the construction, small businesses and retail, manufacturing, mining, and trucking industries.

Many multiemployer pension plans are now in critical and declining status, meaning they are projected to become insolvent, or bankrupt, within the next 20 years. This would leave millions of hard-working Americans without the retirement benefits they planned their futures around. The plans have gotten to this point due to a number of reasons, mainly because unionization rates have dropped, certain industries have shrunk, and the ratio of active-to-inactive participants shifted dramatically over the past few decades.

The Pension Benefit Guaranty Corporation (PBGC), a federal government entity, insures the pension benefits but is projected to become insolvent by 2025. If Congress doesn’t act quickly to address the crisis, millions of Americans will no longer have access to the retirements they planned.

To see where these plans are already failing, check out our map.