Purchaser May Be Liable for Predecessor's Unpaid Union Trust Fund Contributions

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Thanks to the downturn in the economy, many pension trust funds are seriously underfunded and companies are having trouble keeping current with their contractual obligations for trust fund contributions. The former creates unfunded vested liability for employers who have such plans (discussed in previous articles), and the latter creates a continuing liability where audit fees, interests, and liquidated damages soon dwarf the contributions at issue. This liability may be passed to the purchaser of a union company as held by the federal court in the Third Circuit in M. L. Ruberton Construction Company decision, handed down in January of this year.

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