suspension of benefits
(i)For purposes of this subsection, the term “suspension of benefits” means the temporary or permanent reduction of any current or future payment obligation of the plan to any participant or beneficiary under the plan, whether or not in pay status at the time of the suspension of benefits. (ii)Any suspension of benefits made under subparagraph (A) shall remain in effect until the earlier of when the plan sponsor provides benefit improvements in accordance with subparagraph (E) or the suspension of benefits expires by its own terms. (iii)The plan shall not be liable for any benefit payments not made as a result of a suspension of benefits under this paragraph. (iv)For purposes of this paragraph, all references to suspensions of benefits, increases in benefits, or resumptions of suspended benefits with respect to participants shall also apply with respect to benefits of beneficiaries or alternative payees of participants. (v) (I)In the case of a plan with 10,000 or more participants, not later than 60 days prior to the plan sponsor submitting an application to suspend benefits, the plan sponsor shall select a participant of the plan in pay status to act as a retiree representative. The retiree representative shall advocate for the interests of the retired and deferred vested participants and beneficiaries of the plan throughout the suspension approval process. (II)The plan shall provide for reasonable expenses by the retiree representative, including reasonable legal and actuarial support, commensurate with the plan’s size and funded status. (III)Duties performed pursuant to subclause (I) shall not be subject to. The preceding sentence shall not apply to those duties associated with an application to suspend benefits pursuant to subparagraph (G) that are performed by the retiree representative who is also a plan trustee. (C)The plan sponsor of a plan in critical and declining status for a plan year may suspend benefits only if the following conditions are met: (i)Taking into account the proposed suspensions of benefits (and, if applicable, a proposed partition of the plan undersection 1413 of this title), the plan actuary certifies that the plan is projected to avoid insolvency within the meaning ofsection 1426 of this title, assuming the suspensions of benefits continue until the suspensions of benefits expire by their own terms or if no such expiration date is set, indefinitely. (ii)The plan sponsor determines, in a written record to be maintained throughout the period of the benefit suspension, that the plan is still projected to become insolvent unless benefits are suspended under this paragraph, although all reasonable measures to avoid insolvency have been taken (and continue to be taken during the period of the benefit suspension). In its determination, the plan sponsor may take into account factors including the following: (I)Current and past contribution levels. (II)Levels of benefit accruals (including any prior reductions in the rate of benefit accruals). (III)Prior reductions (if any) of adjustable benefits. (IV)Prior suspensions (if any) of benefits under this subsection. (V)The impact on plan solvency of the subsidies and ancillary benefits available to active participants. (VI)Compensation levels of active participants relative to employees in the participants’ industry generally. (VII)Competitive and other economic factors facing contributing employers. (VIII)The impact of benefit and contribution levels on retaining active participants and bargaining groups under the plan. (IX)The impact of past and anticipated contribution increases under the plan on employer attrition and retention levels. (X)Measures undertaken by the plan sponsor to retain or attract contributing employers. (D)Any suspensions of benefits made by a plan sponsor pursuant to this paragraph shall be subject to the following limitations: (i)The monthly benefit of any participant or beneficiary may not be reduced below 110 percent of the monthly benefit which is guaranteed by the Pension Benefit Guaranty Corporation undersection 1322a of this titleon the date of the suspension. (iii)No benefits based on disability (as defined under the plan) may be suspended under this paragraph. (iv)Any suspensions of benefits, in the aggregate (and, if applicable, considered in combination with a partition of the plan undersection 1413 of this title), shall be reasonably estimated to achieve, but not materially exceed, the level that is necessary to avoid insolvency. (v)In any case in which a suspension of benefits with respect to a plan is made in combination with a partition of the plan undersection 1413 of this title, the suspension of benefits may not take effect prior to the effective date of such partition. (vi)Any suspensions of benefits shall be equitably distributed across the participant and beneficiary population, taking into account factors, with respect to participants and beneficiaries and their benefits, that may include one or more of the following: (I)Age and life expectancy. (II)Length of time in pay status. (III)Amount of benefit. (IV)Type of benefit: survivor, normal retirement, early retirement. (V)Extent to which participant or beneficiary is receiving a subsidized benefit. (VI)Extent to which participant or beneficiary has received post-retirement benefit increases. (VII)History of benefit increases and reductions. (VIII)Years to retirement for active employees. (IX)Any discrepancies between active and retiree benefits. (X)Extent to which active participants are reasonably likely to withdraw support for the plan, accelerating employer withdrawals from the plan and increasing the risk of additional benefit reductions for participants in and out of pay status. (XI)Extent to which benefits are attributed to service with an employer that failed to pay its full withdrawal liability. (vii)In the case of a plan that includes the benefits described in clause (III), benefits suspended under this paragraph shall— (I)first, be applied to the maximum extent permissible to benefits attributable to a participant’s service for an employer which withdrew from the plan and failed to pay (or is delinquent with respect to paying) the full amount of its withdrawal liability undersection 1381(b)(1) of this titleor an agreement with the plan, (II)second, except as provided by subclause (III), be applied to all other benefits that may be suspended under this paragraph, and (III)third, be applied to benefits under a plan that are directly attributable to a participant’s service with any employer which has, prior to— (E) (i)The plan sponsor may, in its sole discretion, provide benefit improvements while any suspension of benefits under the plan remains in effect, except that the plan sponsor may not increase the liabilities of the plan by reason of any benefit improvement for any participant or beneficiary not in pay status by the first day of the plan year for which the benefit improvement takes effect, unless— (I)such action is accompanied by equitable benefit improvements in accordance with clause (ii) for all participants and beneficiaries whose benefit commencement dates were before the first day of the plan year for which the benefit improvement for such participant or beneficiary not in pay status took effect; and (II)the plan actuary certifies that after taking into account such benefits improvements the plan is projected to avoid insolvency indefinitely undersection 1426 of this title. (ii) (I)The projected value of the total liabilities for benefit improvements for participants and beneficiaries not in pay status by the date of the first day of the plan year in which the benefit improvements are proposed to take effect, as determined as of such date, may not exceed the projected value of the liabilities arising from benefit improvements for participants and beneficiaries with benefit commencement dates prior to the first day of such plan year, as so determined. (II)The plan sponsor shall equitably distribute any increase in total liabilities for benefit improvements in clause (i) to some or all of the participants and beneficiaries whose benefit commencement date is before the date of the first day of the plan year in which the benefit improvements are proposed to take effect, taking into account the relevant factors described in subparagraph (D)(vi) and the extent to which the benefits of the participants and beneficiaries were suspended. (iii)The plan sponsor may increase liabilities of the plan through a resumption of benefits for participants and beneficiaries in pay status only if the plan sponsor equitably distributes the value of resumed benefits to some or all of the participants and beneficiaries in pay status, taking into account the relevant factors described in subparagraph (D)(vi). (iv)This subparagraph shall not apply to a resumption of suspended benefits or plan amendment which increases liabilities with respect to participants and beneficiaries not in pay status by the first day of the plan year in which the benefit improvements took effect which— (I)the Secretary of the Treasury, in consultation with the Pension Benefit Guaranty Corporation and the Secretary of Labor, determines to be reasonable and which provides for only de minimis increases in the liabilities of the plan, or (II)is required as a condition of qualification under part I of subchapter D of chapter 1 of subtitle A of title 26 or to comply with other applicable law, as determined by the Secretary of the Treasury. (v)Except for resumptions of suspended benefits described in clause (iii), the limitations on benefit improvements while a suspension of benefits is in effect under this paragraph shall be in addition to any other applicable limitations on increases in benefits imposed on a plan.