Employee Benefits Considerations in Joint Ventures

Posted: 24 Oct 2001

See all articles by Susan P. Serota

Susan P. Serota

Pillsbury Winthrop Shaw Pittman LLP


In structuring corporate transactions, companies are increasingly utilizing joint ventures as a form of operating a business. It is necessary to understand the implications of joint ventures on employee compensation and benefit issues. This Article discusses the tax consequences to both the employer and employee which may differ if the entity is taxed as a partnership or a corporation. Also discussed are qualified plan considerations, plans sponsor liabilities under Title IV of ERISA, multiple employer plans, nondiscrimination requirements, the use of pre-participation and imputed service and compensation credits under qualified plans, and the issues relating to participation by joint venture employees in ESOPs and other individual account plans with investment in securities of one of the partners. The Article also discusses incentive compensation and executive compensation issues in joint ventures, including the availability of ISOs and nonqualified options and recent issues arising under the final section 1032 regulations, and welfare plans in joint ventures, including issues relating to MEWAs.

Suggested Citation

Serota, Susan P., Employee Benefits Considerations in Joint Ventures. Available at SSRN: https://ssrn.com/abstract=285822

Susan P. Serota (Contact Author)

Pillsbury Winthrop Shaw Pittman LLP ( email )

One Battery Park Plaza
New York, NY 10004-1490
United States
212-858-1125 (Phone)
212-858-1500 (Fax)

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