Judge cuts pension fund’s claim over contractor top-up contributions

Here’s the setup, because it’s the part HR teams will recognize. The fund pays retirement benefits to workers whose employer signs a collective bargaining agreement, or CBA, with a local SEIU union. Participating employers owe two monthly payments: a base contribution of 40 cents per hour worked, and a supplemental contribution – tied to the fund’s recovery plan – that adds 62.5% on top.

The fund said none of the five contractors paid either one.

Three of them – Flagship Facility Services, AFL Maintenance Group and Whayne & Sons Enterprises – pushed back on the 62.5% piece. They argued the fund never pleaded facts showing they owed it.

The judge agreed, and the reason is the lesson. The fund’s first theory was that the contractors inherited the duty from the previous cleaning company, ISS Facility Services, whose CBA carried the top-up. But the contractors produced their own CBAs, which the court said made “no reference at all to ISS Facility Services or any prior collective bargaining agreement.” The second theory – that the money was owed “as a matter of federal law” under the pension statute known as ERISA – drew an equally short response. The court called it a “mere conclusory statement” with no facts behind it.

So those supplemental-contribution claims were dismissed against the three companies. The base-contribution and reporting claims stayed, because nobody challenged them.