Pension plan sponsors that are late in paying required annual Pension Benefit Guaranty Corp. premiums would pay much smaller penalties under a plan the agency proposed Wednesday

“We think penalties should be no more than necessary to encourage timely payments,” PBGC Director Tom Reeder said in a statement. “I’m committed to doing everything I can to help companies keep their pension plans.”

Currently, the PBGC uses a two-tier penalty structure for late premium payments, with a lower penalty if the plan sponsor pays up before the PBGC uncovers the delinquency and notifies the sponsor that premiums are late.

For example, the PBGC imposes a penalty rate of 1% of the late payment per month when the delinquency is corrected before PBGC sends out a notice. A 5% penalty applies if the correction is made after PBGC notification.

Those penalties would be halved under the PBGC proposal, which will be published in Thursday’s Federal Register.

The PBGC gave two examples as part of its proposal involving a $100,000 premium that is paid two months late.

Under one situation, the employer was two months late in paying the premium but did so before the PBGC sent out a notice.

Under current rules, the PBGC would assess a $2,000 penalty. Under the proposed regulation, the penalty would be $1,000, 0.5% of $100,000 for two months.

Under the other example, the employer made the late payment after being notified by the PBGC.

Currently, the PBGC would impose a $10,000 penalty, but the proposed rule would reduce that to a $5,000 penalty, which is 2½% of $100,000 for two months.

In addition, 80% of penalties assessed at that 2½% penalty rate would be waived if, among other things, the employer had paid premiums on time for the prior five years.

Employer groups and benefit consultants welcomed the proposal.

“It is encouraging to see the PBGC implementing sound policy changes for good actors in the defined benefit market,” said Will Hansen, senior vice president of retirement policy at the ERISA Industry Committee in Washington.

“This is welcome and unexpected news for plan sponsors. Especially positive is the reason given — making it easier for plan sponsors to maintain pension plans,” said Alan Glickstein, senior retirement consultant with Willis Towers Watson P.L.C. in Dallas.

The PBGC has proposed that the new penalty structure apply for plan years beginning in 2016.