Archived Insight | April 12, 2022

Seeing Green: More Multiemployer Plans Are Healthy

While some multiemployer plans remain in critical red-zone status, most are not. In fact, the percentage of plans in the green zone has increased.

For an illustration of how the zone-status breakdown for plans in our latest survey improved between 2020 and 2021, see an infographic.

Get the Infographic

Seeing Green More Multiemployer Plans Are Healthy Download Now

What determines a multiemployer pension plan’s zone status?

A series of measurements determine a plan’s zone status. The two primary factors are the funded percentage and maintenance of the funding standard account credit balance.

The funded percentage is a point-in-time measure. Since it uses the actuarial value of assets, it reflects only a portion of the market-value investment experience. However, projecting the funding standard account credit balance forward reflects the full impact of market-value returns.

To be in the green zone, a plan must have funded percentage of at least 80 percent, and a projected credit balance, rather than a funding deficiency, at the end of seven years, or 10 years in some instances.

We can help you manage changes in your plan’s zone status.

Ask us to run projections that can help you make decisions with confidence.

Segal’s Winter 2022 Survey of Plans’ Zone Status

The 283 plans included in this survey are those with plan years that range from January 1 to July 1.

As a group, these plans have more than $215 billion in assets, provide benefits to just over 3.5 million participants and represent approximately one-third of all participants in multiemployer plans.

The 2021 zone-status certifications for the plans in the survey reflect investment performance before the current market volatility and geopolitical uncertainty.

See more insights

Businesswoman Discussing Technology Trends At A Meeting

AI Uncovered: What Your Organization Needs to Know and Do Now

Join Segal for a webinar on AI and generative AI where we’ll discuss real use cases, practical approaches to governance and ethical AI implementation.
Pharmacist Helping Customer With Prescription Medicine

CMS Proposes Simplified Creditable Coverage Determination

CMS's proposed update to the Rx coverage determination method may require health plans to take a fresh look at their prescription drug benefits.
Asian Businesswoman Contemplating Looking Outside Office Window

2025 Outlook for Pension Legislation, Rules and Litigation

Retirement plan sponsors: How will the new administration affect pension plans in 2025? Learn key areas of major policy and legislative change.

This page is for informational purposes only and does not constitute legal, tax or investment advice. You are encouraged to discuss the issues raised here with your legal, tax and other advisors before determining how the issues apply to your specific situations.