If they meet certain criteria, multiemployer benefit plans can share certain expenses, facilities, and administrative staff without violating prohibited transaction rules under ERISA. Below, courtesy of Jules Levine, Esq.  is a sample agreement plans can use to formally document their agreement.

EXPENSE ALLOCATION AGREEMENT

This AGREEMENT, effective as of ______, 199__ , is by and between the

[list each fund]

with offices at__________________(collectively "the Funds") and

[list union and other entities]

with offices at__________________(the "Union").

WHEREAS, the Funds are employee benefit plans providing participants and beneficiaries with employee benefits, and

WHEREAS, most of the Union's members are covered by the Funds, and

WHEREAS, the Funds and the Union seek to minimize their expenses of administration and, therefore, have shared and will continue to share equipment, supplies, and other administrative and office expenses, and

WHEREAS, The Funds and the Union desire to restate the understandings and procedures that they have established to allocate among them the shared administrative and other expenses.

NOW, THEREFORE, in consideration of the mutual undertakings herein made, the Funds and the Union Agree as follows:

I. Expenses Shared by Union and Funds

A. Office Supplies. Expenses attributable to office supplies commonly used by the Funds and the Union, shall be divided and paid for by the [list funds] and the Union based on usage as shown in Exhibit I attached hereto.

B. Personnel. Expenses attributable to the salaries of Union personnel performing services for the Funds shall be divided and paid f or by the Funds and the Union based on the percentage of time such personnel spend on activities for each Fund and the Union, as shown in Exhibit I attached hereto.

C. Travel. Expenses attributable to. auto leases, gas and oil, tolls and repairs of vehicles used by personnel of the Union shall be divided and paid for by the Funds and the Union based on the percentage of time, such personnel spent on activities for the Funds, as shown on Exhibit I, attached hereto.

II. Adjustments in Allocation

A. The allocation shown in Exhibit I has been determined by the Funds and the Union, in consultation with their retained professionals, based on the actual use of facilities, goods and services by the Funds and the Union.

B. The allocation of expenses, pursuant to Section I of this Agreement, shall be reviewed from time to time based on a study of use of the facilities, goods and services by the Funds and by the Union, and reviewed by the Funds' and Union's respective certified public accountants. The certified public accountants shall report to the Boards of Trustees of the Funds and the Union their conclusions as a result of such review, and Exhibit I to this Agreement shall be amended, if necessary, in accordance with the Board of Trustees; and Union's determination regarding actual usage.

C. The charge for services provided to the Funds by the Union shall be reviewed from time to time and determined as provided for in this subsection. The Funds, and union's certified public accountants shall report to the Boards of Trustees of the Funds and to the Union their conclusions as a result of such review and Exhibit I shall be amended, if necessary as determined by the Board of Trustees of the Funds and the Union.

1. No less than every six (6) months, the Union Personnel providing services to the Funds shall keep such time records for a period of no less than one (1) week as are necessary to determine the allocation of such personnel's time between Union and Fund businesses. The percentage of time spent on each shall be determined based on such time records.

2. The Funds' and Union's respective certified public accountants shall determine the total compensation, including fringe benefits, paid to the Union personnel providing services to the Funds. Such compensation shall include wages, pension benefits, health benefits, and car allowances, if any.

III. Payments

A. On or before the fifth (5th) working day of each month, the Funds shall remit to the Union a sum, as determined by Appendix A, for the purpose of paying salaries, salary related taxes, welfare benefits, pension benefits and other mandated coverage's mandated by regulation.

B. On or before the last business day of each month, the Health and Insurance Fund shall prepare and distribute to the Union the Pension Fund, the Vacation Fund, the Training Fund and the Annuity Fund an invoice showing each tax, utility or similar expense paid during that month, and the allocated share of such expense attributable to the respective Funds and the Union. such invoice shall be paid within f ive (5) working days of its receipt.

C. On or before the last business day of each month, the Union shall prepare and distribute to the Funds an invoice showing each lease cost, gas and oil expenses, tolls and parking expenses paid during that month and the allocated share of such expenses attributable to the Funds. Such invoices shall be paid within five (5) working days of its receipt.

IV. Separate Expenses.

All items not shared by the Funds or the Union pursuant to this Agreement shall be paid for separately by each of the Funds and the Union, including but not limited to organizational dues, separate printing, postage, stationery and services rendered by third parties.

V. Allocated Expenses.

This Agreement shall not limit the ability of persons who have performed services for the Funds and/or the Union from allocating the fees for such services among the Funds and/or the Union based on actual services rendered, nor shall it limit the Funds and the Union from paying fees based on such allocation.

VI. Records.

The Funds and the Union shall maintain during the period of this Agreement and for six years from the termination of the Agreement such records as are necessary to establish that the cost of facilities has been shared on a pro rata basis with respect to the Funds' and Union's use of the facilities, services and goods shared.

VII.

Termination. This Agreement may be terminated, in whole or in part, on reasonable notice in writing by any of the parties, which shall be no less than 30 days. Notice of termination shall be reasonable for the purposes of this paragraph if it states an intention to discontinue sharing any service at the expiration of the then current contract for that service, except that if the Funds and the Union are bound to give notice to a third party under this agreement the terminating party shall give the other parties to this agreement not less than twice the period of notice owed to the third party.

VIII. Effective Date. This Agreement shall be effective for a term of one year, beginning ..................... It shall automatically renew for successive one year terms unless terminated pursuant to Section VII of this Agreement.

IN WITNESS WHEREOF, the Funds and Union have caused this Agreement to be duly executed as of the date first above written.

(PROVIDE SEPARATE SIGNATURE LINES FOR EACH "FUND"]

By:

• Employer Trustee

By:

• Union Trustee

By: