Rehabilitation for Multiemployer Pensions Act

Bill name: Rehabilitation for Multiemployer Pensions Act
Bill sponsor: H.R. 397, Rep. Richard Neal (D-MA)

Summary: The Rehabilitation for Multiemployer Pensions Act would create the Pension Rehabilitation Administration, a new government loan program for failing multiemployer pension plans – i.e. group pension plans covering unionized workers from several different employers and bargained between the union and employers.  Under the bill, the new loan program to rescue failing union pension plans would be funded through the sale of government bonds.  The legislation has near-universal support from Congressional Democrats. Many Republicans and conservatives argue the legislation is a taxpayer-funded bailout for failed and failing defined-benefit union pension plans with no structural reforms to correct systemic failures of multiemployer pensions.

Policy differences between Congressional Democrats and most Republicans have been long evident, particularly during 2018 when the bipartisan, bicameral Joint Select Committee on Solvency of Multiemployer Pension Plans was created to address the growing multiemployer pension plan crisis.  That “pension supercommittee” was unable to agree on a legislative path forward and its activity ended at the close of the 115th Congress.

Similarly, the Democrats’ Rehabilitation for Multiemployer Pensions Act is not expected to move in the Republican-controlled Senate.  Rather, Senate Finance Committee Chairman Chuck Grassley (R-IA) and HELP Committee Chairman Lamar Alexander (R-TN) are crafting their own legislation, the “Multiemployer Pension Recapitalization and Reform Plan,” which would increase pension premiums to better fund the Pension Benefit Guarantee Corporation (PBGC), the federal agency that serves as a financial backstop when a pension plan fails; expand the PBGC’s power to partition out “sick pensions”[1] from otherwise healthy pension plans, and to further protect taxpayers by creating new rules for how multiemployer plans are managed and operated.


Bill Status:  The House of Representatives approved the Rehabilitation for Multiemployer Pensions Act on July 24, 2019 on a vote of 264-169. All House Democrats supported it, along with 29 Republicans. 168 Republicans and 1 Independent opposed the bill. The legislation was sent to the Senate on December 19, 2019, but Senate action is not expected.

[1] Sick pensions are largely those underfunded pensions forced on other companies in a multiemployer plan when a company goes bankrupt.


Click here to read the bill language. 

Click here to download the backgrounder. 

Additional Resources

Letter to Congress: CEI Joins Coalition Letter Opposing H.R. 397, Rehabilitation for Multiemployer Pensions Act
November 15, 2019
Competitive Enterprise Institute

Study: The Rehabilitation for Multiemployer Pensions Act of 2019: No Solution to America’s Pension Crisis
July 25, 2019,
Rachel Greszler, Heritage Foundation

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