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Law Educator, Esq.
Law Educator, Esq., Attorney
Category: Employment Law
Satisfied Customers: 116727
Experience:  20+ Years of Employment Law Experience
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I received a letter today stating that I owe $244,644.08 from

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I received a letter today stating that I owe $244,644.08 from the laborers AGC trust of Montana for withdrawel liability. I have never signed a letter with the union stating that I would be liable for anything of the nature.
The agreement I had with the union was site spacific only. (Stone Container in Frenchtown Montana only.)

My contract with them states that word for word is,
1. This is a Project Agreement between the employer and the Union for the specific project: Stone Container - Frenchtown.
2. There shall be a pre - conference meeting prior to commencement of work on the project.
3. Upon completion of the above project (Stone Container), this agreement shall automatically expire.No actions, by either party shall act to continue this Agreement or any terms thereof to any other project or extend any binding arrangement or agreements beyond the completion of this project.
4. This agreement shall represent the only valid agreement between the parties for any work on the above project.
Thank you for your question. I look forward to working with you to provide you the information you are seeking.

The Employee Retirement Income Security Act of 1974 (ERISA) made the contractors who are signatories to collective bargaining agreements liable for the obligations of the defined benefit plans to which they contribute. 29 U.S.C. §§1001 to 1461. Thus, even if your contract that you signed does not specify anything if you were signed onto a union contract then you become liable for your share of the union pension plan that is supposed to be prorated per contractor.

The Multi-Employer Pension Plan Amendments Act of 1980 (MPPAA). MPPAA created “withdrawal liability” which, in simplified form, imposes on the withdrawing contractor its pro rata share of a plan’s underfunding, based upon the amount previously contributed to the plan by the contractor, at the time of the contractor’s withdrawal. 29 U.S.C. §1381.

Contractors that discontinue operations, change to open-shop labor, or whose employees vote to withdraw from the union are all deemed to have “withdrawn” from the plan. This is what happened here in your situation, your contract expired and you became liable for the withdrawal liability under the federal law, even though it does not say it in your contract.




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Customer: replied 3 years ago.

Even though that it was a one time contract for site specific work, I have to pay. Even though the work ended because of the closure? I never missed a payment with these folks and I just signed another site specific agreement with the union to do other work.....I don't know what to think it sounds like robbery. Appreciate it if you can add to this, and I thank you for your input


 


Dave Murray

Thank you for your question.

Sadly, the answer to your question is, yes, even if you were only in for one job. This is the problem with the unions and their underfunded pensions and why unions are not as great as some people claim them to be. It is robbery, but that is why I posted the law itself for you to read so you would not think I was making up this craziness.
Customer: replied 3 years ago.

To add onto the same question, Stone Container went bankrupt and closed
down the Frenchtown mill. According to the contract I had no more
obligation to the union

Thank you for your response.

This would be a potential defense to argue that you are not liable, but the law itself does not make exceptions for that and merely states that when a company exits the union if there is a shortage in the pension all companies must pay their share I am afraid and this is what unions do not tell people because they do not want them to know how they are bankrupting America. Many businesses have had to file bankruptcy because of these assessments.
Customer: replied 3 years ago.

I have an existing contract with the laborers union now. I have had a contract with them since July at the same place different owners . Could that possibly help me?

Thank you for your response.

Unfortunately, the withdrawal notice is from the time where you were out of the union. Furthermore, as an active union company you are responsible for paying into the pension with all union member companies to make sure it is not underfunded.