Note 11 – Other Retirement Plans

Multiemployer Plans. Certain of MasTec’s subsidiaries, including certain subsidiaries in Canada, are party to various collective bargaining agreements with unions representing certain of their employees. These agreements require the subsidiaries party to the agreements to pay specified wages, provide certain benefits to their union employees and contribute certain amounts to multiemployer pension and other multiemployer benefit plans and trusts. These contributions are recorded as a component of employee wages and salaries within costs of revenue, excluding depreciation and amortization. Contributions are generally based on fixed amounts per hour per employee for employees covered under these plans. Multiemployer plan contribution rates are determined annually and assessed on a “pay-as-you-go” basis based on union employee payrolls. Union payrolls cannot be determined for future periods because the number of union employees employed at any given time, and the plans in which they may participate, vary depending upon the location and number of ongoing projects at a given time and the need for union resources in connection with those projects. The collective bargaining agreements expire at various times and have typically been renegotiated and renewed on terms similar to the ones contained in the expiring agreements.

The Pension Protection Act of 2006, as amended, (the “PPA”) defines the funding rules for defined benefit pension plans and establishes funding classifications for U.S.-registered multiemployer pension plans. In December 2014, the Multiemployer Pension Reform Act of 2014 (the “MPRA”) was enacted to amend and permanently extend the PPA. Under the PPA, plans are classified into one of five categories, based on multiple factors. The amendments that became effective with MPRA include a new “critical and declining” category. The plan classifications, also referred to as a plan’s “zone status,” are: Green (safe), Yellow (endangered), Orange (seriously endangered), and Red (critical or critical and declining). Factors included in the determination of a plan’s zone status include: funded percentage, cash flow position and whether the plan is projecting a minimum funding deficiency.

A multiemployer plan that is so underfunded as to be in “endangered,” “seriously endangered,” “critical,” or “critical and declining” status (as determined under the PPA) is required to adopt a funding improvement plan (“FIP”) or a rehabilitation plan (“RP”), which, among other actions, could include decreased benefits and increased employer contributions, which could take the form of a surcharge on benefit contributions. These actions are intended to improve their funding status over a period of years. If a pension fund is in critical status, a participating employer must pay an automatic surcharge in addition to contributions otherwise required under the collective bargaining agreement (“CBA”). With some exceptions, the surcharge is equal to 5% of required contributions for the initial critical year and 10% for each succeeding plan year in which the plan remains in critical status. The surcharge ceases on the effective date of a CBA (or other agreement) that includes contribution and benefit terms consistent with the rehabilitation plan. Certain plans in which the Company participates are in “endangered,” “seriously endangered,”, “critical”, or “critical and declining” status. The amount of additional funds, if any, that the Company may be obligated to contribute to these plans in the future cannot be estimated due to the uncertainty of the future levels of work that could be required of the union employees covered by these plans, as well as the required future contribution rates and possible surcharges applicable to these plans.

Management evaluates the Company’s participation in the multiemployer pension plans in which it participates on an ongoing basis. In November 2014, the Company, along with other members of the Pipe Line Contractors Association (“PLCA”), voluntarily terminated its participation in several defined benefit multiemployer pension plans that were in critical status in order to mitigate potential future liability in connection with these plans, for which there was no withdrawal liability assessed by the plan administrators as of the date the Company terminated its participation. Although the Company does not believe that it has any material liability associated with its termination of participation in these plans, there can be no assurance that these plans, which were in critical status as of the date the Company terminated its participation, will not assess penalties in the future. Additionally, in November 2011, the Company, along with other members of the PLCA, voluntarily withdrew from the Central States Southeast and Southwest Areas Pension Fund (“Central States”), a defined benefit multiemployer pension plan that was in critical status, and a $6.4 million withdrawal liability was established based on an estimate provided by the Central States administrator as of the date of withdrawal. The Company began paying installments towards this withdrawal liability in 2013, of which $3.0 million and $4.2 million was outstanding as of December 31, 2015 and 2014, respectively, which is included within other current and other long-term liabilities, as appropriate, in the consolidated balance sheets. See Note 15 - Commitments and Contingencies for additional information.

Details of significant multiemployer pension plans as of and for the periods indicated, based upon information available to the Company from plan administrators as well as publicly available information on the U.S. Department of Labor website, are provided in the following table:

Contributions

(in millions)

For the Years Ended December 31,

Pension Protection Act Zone Status

Multiemployer
Pension Plan

Employer Identification Number

Plan Number

2015

2014

2013

Expiration

Date of CBA

2015

As of

2014

As of

FIP/RP Status

Surcharge

Central Pension Fund of the I.U.O.E and Participating Employers

366052390

001

5.7

6.5

10.8

06/01/2017

Green

01/31/2015

(a)

Green

01/31/2014

(a)

Pipeline Industry Pension Fund

736146433

001

2.5

4.8

9.8

06/02/2017

Green

12/31/2014

(b)

Green

12/31/2013

(b)

International Union of Operating Engineers' Local 132 Pension Fund

556015364

001

1.9

—

0.4

06/01/2017

Green

03/31/2015

Green

03/31/2014

West Virginia Laborers' Pension Trust Fund

556026775

001

1.4

0.4

0.5

06/01/2017

Green

03/31/2015

Green

03/31/2014

National Electrical Benefit Fund

530181657

001

1.4

1.3

1.1

Varies through 06/02/2018

Green

12/31/2014

Green

12/31/2013

Teamsters National Pipe Line Pension Fund

461102851

001

1.4

1.7

2.7

06/01/2017

Green

12/31/2014

(b)

Green

12/31/2013

(b)

Michigan Laborers' Pension Fund

386233976

001

0.8

2.1

4.3

06/01/2017

Yellow

08/31/2015

Yellow

08/31/2014

(a)(b)

Implemented

Laborers' National Pension Fund

751280827

001

0.8

1.1

06/01/2017

Green

12/31/2014

Green

12/31/2013

Laborers' District Council of Western Pennsylvania Pension Fund

256135576

001

0.5

1.5

0.4

06/01/2017

Red

12/31/2014

Red

12/31/2013

Implemented

I.B.E.W. Local 769 Management Pension Plan A

866049763

001

0.3

1.6

0.7

07/30/2016

Green

06/30/2015

Green

06/30/2014

(b)

Eighth District Electrical Pension Fund

846100393

001

0.2

0.9

2.2

02/28/2018

Green

03/31/2015

Green

03/31/2014

Operating Engineers' Construction Industry and Misc. Pension Fund

256135579

001

0.1

1.2

0.1

06/01/2017

Green

12/31/2014

(a)

Green

12/31/2013

(a)

Operating Engineers' Local 324 Pension Fund

381900637

001

—

1.7

4.5

06/01/2017

Red

04/30/2015

Red

04/30/2014

Implemented

Other funds

6.8

(c)

7.4

(c)

6.0

Total multiemployer pension plan contributions

23.8

31.9

44.6


(a)	This plan has utilized extended amortization provisions, which provide plans with extensions of time to amortize pension funding shortfalls.


(b)	The Company’s contributions to this plan represent greater than 5% of the plan’s total contributions.

(c)

The 2015 and 2014 contributions include approximately $1.4 million and $0.9 million U.S. dollars, respectively, for Canadian multiemployer pension plans associated with the Company’s 2014 acquisition of Pacer, a Canadian company that employs union resources subject to collective bargaining agreements in connection with certain of its project work. Canadian multiemployer pension plans are not subject to the provisions of ERISA or the funding rules under the PPA that apply to U.S. registered multiemployer pension plans. Contributions to Canadian multiemployer pension plans are based on fixed amounts per hour per employee for employees covered under these plans.

Total contributions to multiemployer plans, and the related number of employees covered by these plans, including with respect to the Company’s Canadian operations for the periods indicated, were as follows:



	Multiemployer Plans
	Covered Employees		Contributions (in millions)
For the Years Ended December 31:	Low	High	Pension		Other Multiemployer		Total
2015	590	2,463	$	23.8	$	9.0	$	32.8
2014	590	2,167	$	31.9	$	4.5	$	36.4
2013	778	2,734	$	44.6	$	3.6	$	48.2

The average number of employees covered under multiemployer plans in which the Company participates has decreased in recent years, due to fewer union resource-based projects, which resulted in a decrease in total multiemployer plan contributions. This decrease was partially offset by higher contribution amounts and per employee contribution rates for certain other multiemployer plans as a result of changes in project and plan mix. The number of union employees employed at any given time varies depending upon the location and number of ongoing projects and the need for union resources in connection with those projects.