Blog Logo
Blog Logo

Ian M. Grecco

Senior Counsel

Contact information

View All News & Insights
BACK TO Ian M.’S PROFILE

No Signature, No Problem: How Conduct Can Bind an Employer to an Agreement

In a recent case involving the Steelworkers Pension Trust (the “SPT”) versus Republic Steel, a federal magistrate judge in the Western District of Pennsylvania ordered Republic Steel to pay the SPT nearly $1.4 million for unpaid contributions and damages under 29 U.S.C. § 1132(g)(2).  Steelworkers Pension Tr. v. Republic Steel, 2023 U.S. Dist. LEXIS 3046, at *8 (W.D. Pa. Jan. 4, 2023).

As a contributing employer to the SPT, Republic Steel is signatory to at least one collective bargaining agreement (CBA) between it and the United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union. The CBA requires Republic Steel to make pension contributions to the SPT for certain work.  The CBA does not, however, expressly set forth the rates of interest and liquidated damages to be applied for any late or unpaid contributions owed.  The SPT utilizes a separate agreement – the Pension Incorporation Agreement – which sets forth additional requirements relating to an employer’s contributions to the SPT, and, in addition, incorporates the SPT’s Declaration of Trust.  Of note, the Declaration of Trust provides for an interest rate of 1.25% per month on all late or unpaid contributions, along with 10% liquidated damages. 

Republic Steel argued that because it did not sign the Pension Incorporation Agreement, it is not bound to the Declaration of Trust and its terms.  Accordingly, Republic Steel argued that the interest rate and liquidated damages amount demanded by the SPT were punitive.  Thus, Republic Steel argued that a lower interest rate, such as the rate set forth by the PBGC, and a lower liquidated damages amount should apply.

The Court ruled in favor of the SPT, finding that the SPT met its burden to show that although Republic Steel did not sign the Pension Incorporation Agreement, it followed certain requirements set forth in that Agreement.  Thus, it was clear that through Republic Steel’s conduct, it intended to be bound by the Pension Incorporation Agreement, which, in turn, incorporates the SPT’s Declaration of Trust and the applicable interest rate and liquidated damages amount for delinquencies.  After the Court’s ruling and the parties’ joint stipulation as to additional amounts owed, the Court ordered Republic Steel to pay $1,198,580.75 in monthly contributions, $67,663.75 in interest, $133,499.23 in liquidated damages, and the SPT’s attorneys’ fees and costs.

Ian Grecco served as first-chair trial counsel.  He regularly represents multiemployer pension plans in delinquency and withdrawal liability matters. For more information about this case or questions, feel free to contact him at igrecco@tuckerlaw.com or 412-594-3957.

August 28, 2023

Serving our clients successfully since 1900

The same attributes that have anchored over a century of success are still our guiding principles today.

Stay up-to-date on the latest News & Insights by subscribing to our alerts

Enter your email address below and be notified when we post new information.