The Ninth Circuit Court of Appeals affirmed a lower court's ruling that exempted Walker Specialty Construction, Inc. from withdrawal liability under the Multiemployer Pension Plan Amendments Act in a decision filed Jan. 5, 2026.
The case, *Walker Specialty Construction, Inc. v. Board of Trustees of the Construction Industry and Laborers Joint Pension Trust for Southern Nevada*, centered on whether the construction company owed withdrawal liability when it ceased participating in a multiemployer pension plan.
The appeals court held that Walker was exempt from withdrawal liability under the MPPAA because its asbestos abatement work qualified it for the "building and construction industry" exception to liability. The three-judge panel, consisting of Circuit Judges Johnnie B. Rawlinson, Eric D. Miller, and Roopali H. Desai, issued a unanimous opinion written by Judge Desai.
The Multiemployer Pension Plan Amendments Act, an amendment to the Employee Retirement Income Security Act, imposes liability on employers that withdraw from multiemployer pension plans. The law was designed to protect pension plans from the financial impact of employer withdrawals by requiring departing employers to pay their share of the plan's unfunded vested benefits.
However, the MPPAA includes several exemptions from withdrawal liability, including one for employers in the "building and construction industry." This exemption recognizes the unique nature of construction work, where employers frequently move between different projects and pension plans.
The dispute arose when Walker Specialty Construction ceased participating in the Construction Industry and Laborers Joint Pension Trust for Southern Nevada. The pension trust's board of trustees assessed withdrawal liability against the company, prompting Walker to challenge the assessment in federal court.
U.S. District Judge Andrew P. Gordon of the District of Nevada granted summary judgment in favor of Walker Specialty Construction. The pension trust appealed the decision to the Ninth Circuit, arguing that Walker's work did not qualify for the building and construction industry exemption.
The Ninth Circuit's analysis focused on the meaning of "building and construction industry" as used in the MPPAA. The court noted that Congress had previously used this term in the Labor Management Relations Act, where the National Labor Relations Board had developed a settled interpretation.
According to the appeals court, the NLRB had established that the "building and construction industry" includes not only the erection of new buildings, but also maintenance, repair, and alterations that are essential to a building or structure's usability. This broader interpretation proved crucial to Walker's case.
The court determined that Walker's asbestos abatement work fell squarely within this definition. Asbestos abatement involves the removal or encapsulation of hazardous asbestos-containing materials from buildings, work that is essential to making structures safe and usable.
"The panel concluded that, as the agency tasked with enforcing the Labor Management Relations Act, the only other statute in which Congress had previously used the term 'building and construction industry,' the National Labor Relations Board established a settled meaning for the term," the court wrote in its opinion summary.
The decision represents a victory for construction companies engaged in specialized building maintenance and remediation work. By affirming that asbestos abatement qualifies for the building and construction industry exemption, the Ninth Circuit provided clarity for companies performing similar environmental remediation services.
The case was argued and submitted March 5, 2025, in Las Vegas, Nevada. The original district court case was filed under docket number 2:23-cv-00281-APG-MDC, with the appeal proceeding under Ninth Circuit case number 24-1560.
The ruling could have broader implications for how courts interpret the building and construction industry exemption under the MPPAA. Companies engaged in building maintenance, environmental remediation, and structural modifications may benefit from the court's expansive interpretation of what constitutes construction industry work.
Multiemployer pension plans are common in the construction industry, where workers frequently move between different employers and projects. These plans allow workers to maintain pension benefits even as they change employers within the industry.
The withdrawal liability provisions of the MPPAA were designed to prevent employers from leaving pension plans when they become financially burdensome, thereby shifting costs to remaining participants. However, the building and construction industry exemption recognizes that the project-based nature of construction work makes traditional withdrawal liability rules impractical.
The Ninth Circuit's decision affirms that specialized construction-related services like asbestos abatement fall within the scope of this exemption, providing important protection for companies in this sector.