Multi-employer pension plans, in which multiple companies pool their pensions together so that other employers can pick up the slack if one company goes under, were long considered some of the safest in the business. And because the plans are also covered by federal insurance plans, the idea that workers would fail to receive their benefits seemed exceedingly unlikely. Yet that’s exactly what’s happening: over the past few years, many of these plans have already failed, and those that haven’t are headed for disaster unless something changes.
The problems are the same as those that are devastating other pension plans. A larger share of company workers are retiring, increasing the amount of benefits the plans need to pay out even as less money is coming in.