Labor & Employment Law Daily Wrap Up, PENSION AND BENEFIT PLANS—9th Cir.: Employer’s asbestos abatement performed in ‘building and construction industry’ so exempt from withdrawal liability, (Jan 6, 2026)

By Ronald Miller, J.D.

The employer was exempt from withdrawal liability under the MPPAA because its asbestos abatement work qualified it for the “building and construction industry” exception to liability.

Because an employer’s asbestos abatement work was performed in the “building and construction industry” under the Multiemployer Pension Plan Amendments Act (MPPAA), it qualified for an exception and so was exempt from withdrawal liability, ruled the Ninth Circuit. The appeals court held that “building and construction industry” under the MPPAA incorporates the NLRB’s established definition of the term and thus included the employer’s asbestos abatement work. Because substantially all of the employer’s employees worked in the “building and construction industry,” it qualified for the exception to withdrawal liability and was thus entitled to summary judgment. Accordingly, the judgment of the district court was affirmed (Walker Specialty Construction, Inc. v. Board of Trustees of the Construction Industry and Laborers Joint Pension Trust for Southern Nevada, No. 24-15670 (9th Cir. Jan. 5, 2026)).

Withdrawal liability. The MPPAA imposes liability on employers that withdraw from multiemployer pension plans. Employers can avoid withdrawal liability if they qualify for an exception available to employers operating in the “building and construction industry.” But the MPPAA does not define the term “building and construction industry.”

The employer’s employees performed asbestos abatement and demolition work in southern Nevada. Asbestos abatement involves the remediation of building materials containing asbestos. Remediation requires removing asbestos-containing materials or covering them with an impermeable coating like polyethylene to prevent the release of asbestos fibers.

A union benefit trust administers a multiemployer pension benefit plan that primarily covers “building and construction industry” employees in southern Nevada. The employer contributed to the Trust’s plan for its employees until 2019, when it stopped operating in the state and ceased contributing to the plan.

In 2021, the Trust sent the employer a letter claiming that it owed $2,837,953 in withdrawal liability based on its 2019 withdrawal. The employer requested review of the Trust’s claim, arguing that it is exempt from withdrawal liability under the MPPAA’s “building and construction industry” exception. The Trust reaffirmed its assessment of withdrawal liability, stating that building and construction involves “forming, making or building a structure,” and asbestos abatement does not qualify because it involves “tearing down structures rather than building or making them.”

Arbitration. The employer-initiated arbitration and both parties moved for summary judgment on the employer’s claim for relief under the exception. The arbitrator granted judgment in favor of the Trust, holding that “work in the construction industry” is “the provision of labor whereby materials and constituent parts may be combined on the building site to form, make or build a structure” and that the employer’s work “does not fit within that definition.”

The employer sued the Trust in district court to contest withdrawal liability. Both parties again moved for summary judgment. The district court rejected the Trust’s understanding of “building and construction industry.” It adopted a more expansive understanding of “building and construction industry,” which includes the erection, maintenance, repair, and alteration of buildings and structures. The district court held that the employer’s asbestos abatement work qualified as work in the “building and construction industry” because it involved “alteration, demolition, repair, or improvement of fixed structures in buildings.” The district court granted summary judgment to the employer and ordered the Trust to return its partial payments with interest. The Trust timely appealed.

MPPAA. Under the MPPAA revisions to ERISA, when an employer withdraws from a multiemployer pension plan, it is liable for its share of the plan’s unfunded vested benefits. Generally, an employer that “permanently ceases” its work in the plan’s jurisdiction has withdrawn and owes withdrawal liability.

But the MPPAA contains a “building and construction industry” exception to withdrawal liability. This exception exempts an employer from paying withdrawal liability if (1) substantially all the employees for whom the employer contributes to the multiemployer pension plan work in the “building and construction industry;” (2) the plan primarily covers employees in the “building and construction industry;” and (3) the employer ceases work in the jurisdiction and does not resume such work within five years.

“Building and construction industry.” The parties agreed that the Trust’s plan primarily covers employees in the “building and construction industry” and that the employer ceased work in the jurisdiction and did not resume within five years. The parties also agreed that substantially all of the employer’s employees performed asbestos abatement. Thus, the sole issue on appeal was whether asbestos abatement qualifies as work in the “building and construction industry.”

The MPPAA does not define “building and construction industry,” and neither the Supreme Court nor the Ninth Circuit has interpreted it as used in the MPPAA. Interpreting this statutory term is an issue of first impression. At the time of the MPPAA’s enactment, Congress had used the term “building and construction industry” in only one other statute—the NLRA. Because the NLRB established a settled meaning for the term “building and construction industry,” the appeals court inferred that Congress incorporated the NLRB’s definition of “building and construction industry” into the MPPAA.

Settled meaning. The NLRB’s meaning of construction covers the erection, maintenance, and repair of immobile structures and utilities. The NLRB similarly noted that “construction” includes “new work, additions, alterations, and repairs.” In Zidell Explorations, Inc. 175 N.L.R.B. 887 (1969), the NLRB reaffirmed that the “building and construction industry” includes the alteration and demolition of buildings.

Thus, for over a decade before the MPPAA, the term “building and construction industry” had a settled meaning under Taft-Hartley. Further, two sister circuits—the Eighth and Second Circuits—similarly rely on the NLRB’s expansive interpretation of “building and construction industry” to include repairs and alterations under the MPPAA exception.

Because the term “building and construction industry” had a settled meaning prior to the MPPAA’s enactment, the Ninth Circuit inferred that Congress was aware of and intended to incorporate this definition when it enacted the “building and construction industry” exception in the MPPAA. Thus, the appeals court adopted the NLRB’s interpretation of “building and construction industry” to determine the term’s meaning under the MPPAA.

Asbestos abatement. Turning to the facts at hand, the appeals court concluded that asbestos abatement is work within the “building and construction industry” because it involves the “maintenance and repair... of immobile structures... which become integral parts of structures and are essential to their use for any general purpose.” By removing asbestos from building walls, roofs, and floors, the employer repairs integral parts of buildings and ensures that the buildings are usable without any hazard to occupants’ health. Thus, the employer’s asbestos abatement was part of the “building and construction industry” under the MPPAA.

Accordingly, the judgment of the district court was affirmed.

The case is No. 24-15670.

Judge: Desai, R.

Attorneys: Ryan C. Curtis (Fennemore Craig) for Walker Specialty Construction, Inc. Adam P. Segal (Brownstein Hyatt Farber Schreck) for Board of Trustees of the Construction Industry and Laborers Joint Pension Trust for Southern Nevada.

Companies: Walker Specialty Construction, Inc.; Board of Trustees of the Construction Industry and Laborers Joint Pension Trust for Southern Nevada

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