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Pension Funding Respite Could Trigger Future Premium Hikes

June 1, 2020, 9:46 AM

Companies that delay pension contributions as allowed under the $2 trillion federal stimulus law may wind up owing millions more if they wait too long to pay.

Single employers with underfunded pension plans may postpone required contributions to the Pension Benefit Guaranty Corporation until Dec. 31 as part of the administration’s coronavirus relief efforts. Lawmakers tacked on corresponding interest payments so beneficiaries wouldn’t suffer losses from companies hoarding cash due to the Covid-19 pandemic.

The nine-month reprieve, which has allowed employers such as Delta Air Lines to put off $500 million in pension funding and Frontier Communication Corp. to...

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