COVID-19 impact: What’s trending in benefits?
Milliman pulse survey uncovers key benefit trends shaped by COVID-19
The 30% jump in unemployment nationwide, revealed on March 26, 2020, by state officials and the U.S. Department of Labor, was a startling realization of the damage the COVID-19 outbreak is inflicting on the economy. As job losses rise, there are some economists predicting that the jobless rate could be higher than the 10% level of the global financial crisis, which ended in 2009.
As employers are facing the harsh reality of implementing layoffs to maintain economic viability, there may be unintended consequences to various retirement programs, especially pension, post-retirement benefits, and other plans. Plan sponsors may not have had the chance to fully consider how the swift actions taken by employers will affect such plans.
While there are numerous items for an employer to consider during this unprecedented time, the focus below is on items for plan sponsors to consider as they relate to pension plans, post-retirement benefits, and other plans following a reduction in force such as layoffs or furloughs. Plan sponsors should consider:
The considerations and/or requirements are numerous, complex, sometimes conflicting, and often contain harsh penalties for non-compliance. For more details, contact your Milliman consultant.
Impact of COVID-19 on your pension plan: Considerations for layoffs
As employers are facing the harsh reality of implementing layoffs to maintain economic viability, there may be unintended consequences to various retirement programs, especially pension, post-retirement benefit, and other plans.