PBGC Approves $868.8M Special Financial Assistance for UNITE HERE Fund

PBGC Press Releases

Published January 15th, 2025

Detected March 14th, 2026

Summary

The Pension Benefit Guaranty Corporation (PBGC) has approved $868.8 million in Special Financial Assistance (SFA) for the UNITE HERE Fund. This funding averts insolvency for the plan, which covers over 91,000 hospitality workers, preventing benefit reductions.

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What changed

The Pension Benefit Guaranty Corporation (PBGC) announced the approval of approximately $868.8 million in Special Financial Assistance (SFA) to the Legacy Plan of the UNITE HERE Retirement Fund. This action, taken on January 15, 2025, is part of the American Rescue Plan's SFA Program, designed to prevent the insolvency of severely underfunded multiemployer pension plans. The UNITE HERE Fund, covering 91,744 participants in the hospitality industry, was projected to become insolvent in 2030, necessitating benefit reductions of roughly 15%. This SFA will allow the plan to continue paying full benefits.

Regulated entities, particularly multiemployer pension plans facing insolvency, should note the successful application of the SFA program. While this specific action is a PBGC approval, it highlights the availability and mechanism of the SFA. Plans seeking or receiving SFA must adhere to specific terms, conditions, and reporting requirements, including annual statements and potential PBGC audits. The SFA Program operates under final rules published in July 2022, with amendments effective in January 2023. No specific compliance deadline is mentioned for other plans, but the effective date of the SFA program itself is ongoing.

What to do next

Review PBGC's Special Financial Assistance (SFA) Program guidelines if managing an underfunded multiemployer pension plan.
Ensure adherence to all terms, conditions, and reporting requirements for plans receiving SFA.
Consult PBGC regulations and guidance regarding SFA application and administration.

Source document (simplified)

This page has not been translated. Please go to PBGC.gov's Spanish home page for more information available in Spanish.

Esta página no ha sido traducida. Por favor vaya a la página principal del sitio de español de PBGC para ver información disponible en español.

PBGC approves SFA application for UNITE HERE Fund

UNITE HERE Fund averts insolvency and reduction of benefits through receipt of special financial assistance For Immediate Release Date

January 15, 2025

WASHINGTON — The Pension Benefit Guaranty Corporation (PBGC) announced today that it has approved the application submitted to the Special Financial Assistance (SFA) Program by the Legacy Plan of the UNITE HERE Retirement Fund (UNITE HERE Fund). The plan, based in White Plains, New York, covers 91,744 participants in the hospitality industry.

The UNITE HERE Fund will receive approximately $868.8 million in SFA, including interest to the expected date of payment to the plan. The plan was projected to become insolvent and run out of money in 2030. Without the SFA Program, the UNITE HERE Fund would have been required to reduce participants’ benefits to the PBGC guarantee levels upon plan insolvency, which is roughly 15% below the benefits payable under the terms of the plan. That means, if not for the SFA Program, participants in the plan would have seen their monthly pension benefits reduced by roughly 15%. SFA will enable the plan to continue to pay retirement benefits without reduction for many years into the future.

The SFA Program was enacted as part of the American Rescue Plan (ARP) Act – signed by President Biden on March 11, 2021. Through January 15, 2025, two pension plans covering approximately 94,000 hospitality workers across the country have received a total of $902.1 million in special financial assistance. Thanks to the American Rescue Plan and the SFA Program, these hospitality workers have been saved from cuts to their earned pension benefits.

“The American Rescue Plan provided the most significant action in over 50 years to ensure workers and retirees enjoy the secure retirement they have earned. Now, with this Special Financial Assistance to the Legacy Plan of the UNITE HERE Retirement Fund, 91,744 UNITE HERE workers and retirees will have their pension benefits protected from expected future cuts,” said Acting Secretary of Labor Julie A. Su. "These workers are the backbone of our economy and deserve to retire with dignity. The Biden-Harris administration has stood with workers time and time again, ensuring that more than 1.3 million workers, retirees and their families will receive their full retirement benefits.”

About the Special Financial Assistance Program

The SFA Program provides funding to severely underfunded multiemployer pension plans and will ensure that millions of America’s workers, retirees, and their families receive the pension benefits they earned.

The SFA Program requires plans to demonstrate eligibility for SFA and to calculate the amount of assistance pursuant to ARP and PBGC’s regulations. SFA and earnings thereon must be segregated from other plan assets and may be used only to pay plan benefits and administrative expenses. Plans receiving SFA are also subject to certain terms, conditions and reporting requirements, including an annual statement documenting compliance with the terms and conditions. PBGC is authorized to conduct periodic audits of multiemployer plans that receive SFA.

As of January 15, 2025, PBGC has announced approval of about $70.9 billion in SFA to 109 plans that cover about 1,336,000 workers, retirees, and beneficiaries.

The SFA Program operates under a final rule, published in the Federal Register on July 8, 2022, which became effective August 8, 2022, and was amended effective January 26, 2023.

About PBGC

PBGC protects the retirement security of about 31 million American workers, retirees, and beneficiaries in both single-employer and multiemployer private sector pension plans. The agency’s two insurance programs are legally separate and operationally and financially independent. PBGC is directly responsible for the benefits of nearly 1.4 million participants and beneficiaries in failed single-employer pension plans. The Single-Employer Program is financed by insurance premiums, investment income, and assets and recoveries from failed single-employer plans. The Multiemployer Program is financed by insurance premiums and investment income. Special financial assistance for financially troubled multiemployer plans is financed by general taxpayer monies.

Press Release Number: 25-005