Key Takeaways
- • The U.S. Supreme Court unanimously ruled in M&K Employee Solutions v. Trustees of the IAM National Pension Fund that actuaries may use current economic assumptions, not those in effect the prior year, when calculating withdrawal liability under ERISA.
- • Justice Ketanji Brown Jackson wrote the opinion, holding that the ERISA "as of" measurement-date requirement fixes only the plan's factual data, while actuarial assumptions can be selected at the time of calculation.
- • The choice of discount rate matters materially: the departing employer owed more than three times as much under the rate prevailing at calculation than under the rate set the previous year.
- • SCOTUSblog's Ronald Mann expects limited impact on ERISA litigation generally, though the ruling resolves a conflict with courts in New York that had applied the contrary rule.
Summary
The U.S. Supreme Court unanimously held that actuaries calculating withdrawal liability for employers leaving a multiemployer pension plan are not required to use assumptions fixed at the start of the preceding year. The decision in M&K Employee Solutions v. Trustees of the IAM National Pension Fund, issued May 21, 2026 and reported by SCOTUSblog on May 22, was written by Justice Ketanji Brown Jackson, according to SCOTUSblog analysis by Ronald Mann.
Under the Employee Retirement Income Security Act of 1974 (ERISA), a departing employer must pay its share of unfunded vested benefits, calculated by an actuary "as of" a measurement date, defined as the last day of the plan year before withdrawal. Because the calculation is performed after that date, the statute leaves open whether economic assumptions, particularly the discount rate, must reflect conditions on the measurement date or on the date the actuary performs the calculation. The stakes are substantial: in this case, the departing employer owed more than three times as much under the interest rate in effect at the time of calculation as it would have under the rate set the previous year.
Jackson wrote that the "as of" language "means two things": the plan's hard data must be fixed on the measurement date, but the calculation itself may be performed later. She characterized actuarial assumptions as "predictive judgments about a plan's anticipated future performance" rather than factual inputs, noting that they are not generally "in effect" for a particular period. Consequently, assumptions "cannot be 'frozen' on the measurement date."
The opinion also relied on statutory text. ERISA requires assumptions to be reasonable and to represent the actuary's best estimate of anticipated experience, but does not specify a required date for selecting them. Jackson noted that Congress specified relevant assumptions in other provisions of the statute, and reasoned that its omission here was intentional.
Mann characterized the ruling as likely to have limited importance in the broader body of ERISA litigation, which concerns plan administration provisions rather than withdrawal liability calculation. The Court took the case because lower courts in New York had applied a rule contrary to the one now adopted, and the decision settles that split.
Under the Employee Retirement Income Security Act of 1974 (ERISA), a departing employer must pay its share of unfunded vested benefits, calculated by an actuary "as of" a measurement date, defined as the last day of the plan year before withdrawal. Because the calculation is performed after that date, the statute leaves open whether economic assumptions, particularly the discount rate, must reflect conditions on the measurement date or on the date the actuary performs the calculation. The stakes are substantial: in this case, the departing employer owed more than three times as much under the interest rate in effect at the time of calculation as it would have under the rate set the previous year.
Jackson wrote that the "as of" language "means two things": the plan's hard data must be fixed on the measurement date, but the calculation itself may be performed later. She characterized actuarial assumptions as "predictive judgments about a plan's anticipated future performance" rather than factual inputs, noting that they are not generally "in effect" for a particular period. Consequently, assumptions "cannot be 'frozen' on the measurement date."
The opinion also relied on statutory text. ERISA requires assumptions to be reasonable and to represent the actuary's best estimate of anticipated experience, but does not specify a required date for selecting them. Jackson noted that Congress specified relevant assumptions in other provisions of the statute, and reasoned that its omission here was intentional.
Mann characterized the ruling as likely to have limited importance in the broader body of ERISA litigation, which concerns plan administration provisions rather than withdrawal liability calculation. The Court took the case because lower courts in New York had applied a rule contrary to the one now adopted, and the decision settles that split.
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