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Updated: 23 hours 13 min ago

New law lets some pension plans cut promised benefits

Fri, 12/19/2014 - 11:51
Michelle SingletaryThe Washington PostDecember 19, 2014View the original piece

For some retirees, Congress has played the Grinch this holiday season.

Tucked into the federal spending bill were provisions that will allow certain struggling multi-employer pension plans to reduce benefits already being received by retirees.

Click here to read more at The Washington Post.

Issues: Pension and Benefits
Categories: Labor News, Unions

A devastating blow to retirees

Fri, 12/19/2014 - 11:47
MSNBCDecember 19, 2014View the original piece

America "survived" the government shutdown, sacrificing the benefits and pensions for millions of retirees. Ed Schultz gives an impassioned response to the new budget. Sen. Bernie Sanders and Rep. Tony Cardenas join the conversation.

Click here to see the video.

Issues: Pension and Benefits
Categories: Labor News, Unions

HOS Restart Rule Reverts to Pre-July 2013 Status; Questions and Answers

Wed, 12/17/2014 - 06:58
Transport TopicsDecember 17, 2014

Questions and answers on the impact of the suspension of the HOS restart provision approved by Congress (as supplied by American Trucking Associations): 

On Dec. 13, Congress passed the fiscal year 2015 Omnibus Appropriations bill, providing funding for the vast majority of the federal government, including the Department of Transportation, for the current fiscal year. The President signed the bill into law Dec. 16. Officially titled the Consolidated and Further Continuing Appropriations Act, 2015, the bill is over 1,700 pages long and has a host of detailed spending and policy-related provisions affecting many industries. 

The most important trucking-related provision is language that provides relief from the two new restrictions of the hours-of-service restart rule. Specifically, the legislation suspends the requirement that all qualifying restarts contain two consecutive periods of time between 1 a.m. and 5 a.m., and that it can only be used once every 168 hours (or seven days). In other words, the restart rule reverts back to the simple 34-hour restart in effect from 2003 to June 2013.

Below are some frequently asked questions to help understand the impact of this action.

1. What does the Congressional language actually say, and what does it mean?

The legislation says:

“Section 133 temporarily suspends enforcement of the hours-of-service regulation related to the restart provisions that went into effect on July 1, 2013 and directs the Secretary to conduct a study of the operational, safety, health and fatigue aspects of the restart provisions in effect before and after July 1, 2013. The Inspector General is directed to review the study plan and report to the House and Senate Committees on Appropriations whether it meets the requirements under this provision."

Essentially, this law eliminates, temporarily, the two new restrictions on the use of the 34-hour restart, namely the 1-5 a.m. provision and the 168-hour rule. Drivers will be permitted to restart their weekly hours by taking at least 34 consecutive hours off-duty, regardless of whether or not it includes two periods of time between 1 a.m. and 5 a.m. A driver can also utilize the restart more than one time per week if necessary.

2. When is the new 34-hour restart effective?

The 34-hour restart rule reverted to its pre-July 1, 2013 version on Dec. 16 when the President signed the bill into law. 

3. How long will this change last?

Because the language resides in an annual spending bill, its terms expire at the end of FY2015, which is Sept. 30, 2015.  It’s important to note that the legislation also directs the Department of Transportation to conduct a study comparing the effectiveness of the 34-hour restart rules in place before July 1, 2013 with those that took effect after. During 2015, ATA will continue to pursue strategies in an effort to keep the simple 34-hour restart rule in place for a longer period of time.

4. Does the legislation include any other changes to the hours-of-service rules?

No, all other hours-of-service rules, including the 30-minute rest break provision, remain unchanged and must be complied with.

5. If our trucks have ELDs, will we be able to use the simple 34-hour restart immediately?

Carriers are encouraged to work with their ELD suppliers to determine what software updates are necessary to comply with this legislatively directed rule change. A short transition period may be necessary, and ATA encourages fleets to be patient as ELD suppliers will need some time to write and deploy the software updates.

6. Will enforcement officials know about this change?

Soon after the law is signed, ATA fully expects the Commercial Vehicle Safety Alliance and the Federal Motor Carrier Safety Administration to issue enforcement memos describing the changes and their impact to law enforcement personnel. The enforcement memos/guidance will be distributed by ATA to its members as they become available. Motor carriers may experience minor disruptions at roadside as law enforcement adapt to the changes. If a driver experiences a problem at roadside, you should contact head of the commercial vehicle safety program in that state’s lead MCSAP agency.

Issues: Freight
Categories: Labor News, Unions

Brief Summary of Pension Legislation

Tue, 12/16/2014 - 09:35
Segal ConsultingDecember 16, 2014

Click here to read a brief summary of the Multiemployer Pension Reform passed by Congress expected to become law.

Issues: Pension and Benefits
Categories: Labor News, Unions

Self-Driving Trucks Could Revolutionize Package Delivery, DHL Predicts

Tue, 12/16/2014 - 07:30
Richard WeissBloomberg NewsDecember 16, 2014View the original piece

While Google Inc. plans to someday unleash driverless cars on public streets, the logistics industry will probably be one of the first training grounds for such automated vehicles.

Shipping companies will probably adopt the technology faster than other industries as moving cargo in non-public areas like storage facilities and warehouses offers a way to test such devices with less risk to human life, according to a study published by DHL, the freight and express arm of Deutsche Post AG. Eventually vehicles might bring packages to a pick-up station where a consumer could find them, the shipper said.

DHL plans to “maintain pole position in the world of self-driving vehicles,” wrote Matthias Heutger and Markus Kueckelhaus, the authors of the study. “The question is no longer ‘if’ but rather ‘when’ autonomous vehicles will drive onto our streets and highways.”

A boom in electronic commerce is making it harder for delivery companies from DHL to UPS Inc. to satisfy consumers who expect first-attempt delivery even though they’re not home during daytime hours.

With online retailers including Amazon.com Inc. and Google developing drones to push into the delivery business, companies are contemplating new solutions, such as making deliveries to the trunk of a customer’s parked car.

Warehouses have been using robots and automated pallet movers for decades, however, the systems typically stop when they encounter obstacles to ensure safety, the study said. The robots will in the future deploy vision-guidance technologies including depth cameras and lasers to improve efficiency, and include more steps of the shipping process.

Robots will also increasingly be used outdoors at shipyards, ports and airports to automatize movement of pallets and swap containers, the study said.

On roads, existing driver assistance systems will be enhanced to ensure vehicles stay in their lanes, obey speed limits and eventually automate functions like overtaking and leaving a highway, while semi-automatic trucks will develop from being able to drive parts of a journey themselves before driverless trucks become reality, the study said.

Automation will improve road safety and fuel efficiency and increase the economics of the logistics chain, the study said.

Komatsu Ltd. is already developing driverless dump trucks and Caterpillar Inc. deploys driverless hauling vehicles to improve productivity in mines for BHP Billiton Plc. Further out, the DHL study envisaged more “futuristic” solutions such as self-driving parcels that may one day arrive through small gates in consumers’ doors, similar to a cat flap.

Deutsche Post started a pilot project of sending urgent goods to the island of Juist in Germany’s Wadden Sea, beating Amazon and Google to offer the first scheduled parcel delivery service with drones this year. The company has said it will take time before such services become a widespread possibility.

Issues: Freight
Categories: Labor News, Unions

New labor board will keep bosses from stalling union elections

Tue, 12/16/2014 - 07:23
Laura ClawsonDaily KosDecember 16, 2014View the original piece

The National Labor Relations Board finally issued its long-in-the-works rule speeding up union representation elections. Currently, employers can drag out the election process by withholding information from organizers and with frivolous lawsuits, time they often use to intimidate and coerce workers away from union support.

The new rule, set to take effect on April 15, will cut waiting times between when an election is set and when it happens, put off litigation—often filed by businesses to drag out the election process—until after the election, allow election petitions to be filed electronically (hi there, 21st century!), require businesses to share additional worker contact information with union organizers, and consolidate the post-election appeals process.

Click here to read more at Daily Kos.

Issues: Labor Movement
Categories: Labor News, Unions

Join the Pension Justice Campaign

Mon, 12/15/2014 - 13:46

December 15, 2014: Congress has passed legislation that guts pension protections and may pave the way for benefit cuts in the Central States Pension Fund.

We’re not going to stand by and let this happen without a fight.

Yesterday, TDU held a conference call with over 400 Teamsters and retirees—and we are just getting started.

Click here to join our Campaign for Pension Justice.

Our Campaign for Pension Justice will make our voices heard from Capitol Hill to the Central States Pension Fund.

We will continue to partner with allies like the Pension Rights Center, the AARP, and unions to challenge the new law and fight for new pension protections.

We’re also organizing Teamsters and retirees to take on the Central States Pension Fund directly.

We are prepared to hold pension organizing meetings around the country to inform and mobilize Teamsters and retirees.

Click here to join our Campaign for Pension Justice.

Our pension funds have been run down by Wall Street and the Hoffa administration. Retirees shouldn’t pay the price for their failures. 

Issues: Pension and Benefits
Categories: Labor News, Unions

Workers At Con-Way Freight In Miami Vote To Join Teamsters Local 769

Mon, 12/15/2014 - 10:22
International Brotherhood of TeamstersDecember 15, 2014View the original piece

A group of 74 drivers and dockworkers at Con-way Freight in Miami Lakes, Fla., voted today to join Teamsters Local 769 in North Miami, Fla.

“The Con-way workers have taken a bold step today to improve their lives and have a more secure future as Teamsters,” said Mike Scott, President of Teamsters Local 769. “As we have seen across the country, the company spent lots of money to wage a vicious anti-worker campaign, but the workers remained strong and united and didn’t let management’s bullying get to them.”

Click here to read more.

Issues: Labor Movement
Categories: Labor News, Unions

UPS Profits Off Pension Cuts

Mon, 12/15/2014 - 07:54

December 15, 2014: The lame duck Congress has attached pension cut legislation to the end-of-year spending bill that will pave the way for the worst pension cuts in Teamster history.

Leave it to UPS to find a way to make billions off this disaster.

UPS lobbyists fought for and won a special interest loophole that shifts $2 billion in the company’s pension responsibilities on to the backs of Teamster retirees in the Central States. These retirees will now face even bigger pension cuts as a result.

UPS is the one and only company that benefits from the loophole on pages 81-82. Its purpose is to ensure that the Central States Pension Fund will not reduce the pensions of UPS workers who retired after January 1, 2008.

Not reducing pensions. Isn’t that a good thing? Of course! But UPS retirees in the Central States are already protected from having their pensions reduced.

In the case of any pension cuts by Central States, Article 34, Section 1 of the UPS master agreement, requires the company to make up any lost pension benefits.

UPS’s special interest loophole means the company won’t have to make up for any pension cuts. The loophole doesn’t save UPS retirees a dime, but UPS will save a fortune.

Teamster retirees and their widows will face $2 billion more in pension cuts so UPS can get out of paying the obligations it agreed to in the contact.

What can Brown do for you? Certainly, not this.

Issues: UPSPension and Benefits
Categories: Labor News, Unions

Middle-class retirees deserve better from Congress

Mon, 12/15/2014 - 06:40
Editorial BoardSt. Louis Post-DispatchDecember 15, 2014View the original piece

The devastating pension reform crammed into the omnibus spending bill that will likely soon become law would allow pension trustees to slash the benefits of retired workers and cut future benefits for a shrinking pool of middle-income employees.

These people were and are the backbone of our nation’s economy. They drive trucks, mine coal, haul bricks and bag groceries. Corporations have been weaseling out of guarantees for future retirees for years, but promises to current retirees generally have been sacrosanct.

Most of these employees contributed what was expected of them over their working lifetimes and retired — or hope to — with a well-earned nest egg.

 

The plans that will be affected are know as multiemployer pension plans. They typically involve union workers who are allowed to accrue benefits while changing employers, with each employer contributing to the plan.

About 1,400 such plans currently cover about 10 million workers, and most of the plans are solvent. Between 150 and 200 of them, covering roughly 1.5 million workers, are not. They could run out of funds within the next 20 years, according to the Pension Rights Center.

It’s those pension plans that the legislation aims to benefit. The Pension Benefit Guaranty Corp., an agency set up 40 years ago to guarantee those pensions, says it may run out of money to pay them in 2018, and is certain to be broke by 2025.

Hence the emergency. While it is important to help prevent these plans from becoming insolvent, pension advocates say the deal Congress worked out in haste and then attached to the $1.1 trillion budget bill funding all of government is the wrong way to do it.

That politicians are willing to eviscerate labor law safeguards that have been in place since 1974 under the Employee Retirement Income Security Act, known by its acronym, ERISA, is a sign of what little value they place on the futures of the hard-working men and women of Main Street.

Because the plans generally benefit union members, they are not popular with congressional Republicans. Union political influence has been waning for years and some of the plans — such as the Central States Teamsters fund — have a history that includes legendary levels of corruption. Even though that was generations ago, it’s enough to give cover to grandstanding lawmakers who want to look like they have a legitimate reason to vote against older, middle-class workers.

Selling out these workers is the wrong message to send to future retirees. The baby boomers now retiring may be the last generation of Americans to leave work assured of adequate income in old age. It’s not just the 1 percent who deserve security.

Issues: Pension and Benefits
Categories: Labor News, Unions

Bill to Let Multiemployer Pensions Cut Benefits Passes

Sun, 12/14/2014 - 08:19
Stephen MillerSHRMDecember 14, 2014View the original piece

Severely distressed multiemployer pensions will be able to reduce benefits paid to retirees under an amendment to the omnibus spending bill approved by the U.S. Senate on Dec. 13, two days after House passage. The bill now goes to the White House for an expected presidential signature.

The pension measure, which was negotiated by a bipartisan group of congressional leaders but opposed by some retiree advocates and their congressional allies, is intended to let deeply underfunded multiemployer plans avoid bankruptcy and termination, and by doing so to keep solvent the multiemployer pension insurance fund overseen by the Pension Benefit Guaranty Corp. (PBGC), the federal pension insurance program.

The provisions apply only to multiemployer pensions and not to single-sponsor corporate pensions, which are subject to a different set of regulations and higher funding-level requirements. The PBGC maintains a separate insurance fund for single-sponsor pensions. Multiemployer or "Taft-Hartley" pension plans commonly are administered by labor unions on behalf of their members and funded by multiple employers in a common industry, subject to collective bargaining contracts with the union.

As SHRM Online recently reported (see Multiemployer Pension Funding Crisis Looms), in November 2014 the PBGC issued a report indicating its multiemployer insurance program was almost certain to become insolvent in 10 years. Of the 1,400 multiemployer plans nationwide, 200 plans covering a total of 1 million participants are at risk of termination.

Cutback Provisions

The measure passed by the House would allow trustees of financially troubled multiemployer pensions to cut retiree benefits to prevent plan insolvency. Financially troubled plans are those that are expected to not have enough money to pay 100 percent of benefits in 10 to 20 years. In some cases, the cuts could exceed 60 percent of a participant’s benefits.

Under the measure:

Retirees who are age 80 or over, or are receiving a disability pension, are not subject to benefit cuts. Retirees ages 75-79 are subject to smaller cuts than retirees under age 75.

Plan trustees have discretion in deciding how to allocate the cuts. For example, they can cut retirees’ benefits more than those of active workers, and decide whether to reduce survivors’ benefits.

Plan trustees are exempt from fiduciary responsibility in making cuts.

Trustees’ decisions to cut benefits can only be reversed by the Department of Treasury, and then only if the Treasury determines that the trustees’ decision to cut benefits or the extent of the benefit cuts is “clearly erroneous.”

There is no provision for automatic restoration of lost benefits if a plan’s funding status improves.

Plans with 10,000 or more participants must allow all participants to vote on cuts before they are implemented. A majority of all workers and retirees in a plan—not just a majority of the ones who vote—is required to block cuts. Ballots can be distributed by e-mail.

Even if a majority of participants vote against cuts, the Treasury Department can override the vote and uphold the trustees’ decision to make cuts, if it concludes that a plan poses a “systemic” risk to the PBGC.

The insurance premiums that multiemployer plans pay to the PBGC are increased from $13 to $26 per participant per year. (In contrast, premiums paid to the single-employer plan program are between $57 and $475 per participant per year.)

Strong Responses

“The pension provisions in the spending bill allow trustees of financially troubled multiemployer pension plans to reduce benefits of retirees by as much as 60 percent if there is a projection that plan assets might be depleted in 10 to 20 years—when many of today’s retirees will no longer be alive,” according to a critical statement by the Pension Rights Center, an advocacy group for pensioners. “Also extremely troubling is the secretive process by which these provisions were pushed through Congress, buried in a must-pass bill in the last days of a lame-duck session, without input from the pensioners whose lives could be devastated by the cutbacks authorized by the measure. The process was undemocratic and unfair.”

In a letter to House and Senate members, AARP also opposed passage, stating that “Permitting plans to break the fundamental requirement of the Employee Retirement Income Security Act (ERISA)—that plans must honor pension promises for benefits already earned and vested—not only would hurt retirees, it would also significantly weaken ERISA and set an undesirable precedent. This precedent could have a detrimental impact on other earned pensions, and the overall retirement income security of the nation.”

Sen. Ron Wyden, D-Ore., said in a statement, “Under this bill, for the first time, Congress will allow multiemployer plans to cut retirees’ earned pension benefits. This is unprecedented and I worry about the impact on retirees and the slippery slope we’re about to head down.”

But Rep. George Miller, D-Calif., who along with Rep. John Kline, R-Minn., put together the coalition supporting the amendment, told the Washington Post, “We have to do something to allow these plans to make the corrections and adjustments they need to keep these plans viable.”

Randy G. DeFrehn, executive director of the National Coordinating Committee for Multiemployer Plans, an employer-union coalition, said in a statement that House passage of the measure “recognizes the years of work that America’s unions and employers did to develop a solution that doesn’t require a massive taxpayer bailout and instead provides a path forward for these troubled pension plans.”

smiller [at] shrm.org (Stephen Miller), CEBS, is an online editor/manager for SHRM. Follow him on Twitter @SHRMsmiller.

Related SHRM Articles:

Multiemployer Pension Funding Crisis Looms, SHRM Online Legal Issues, December 2014

Multiemployer Pension Plan Problems Aired, SHRM Online Benefits, November 2013

FASB Issues Update on Employer Disclosures for Multiemployer Plans, SHRM Online Benefits, September 2011

- See more at: http://www.shrm.org/hrdisciplines/benefits/articles/pages/multiemployer-...(SHRM+Online+Compensation+%26+Benefits+News)#sthash.iJfhUlGV.dpuf

Severely distressed multiemployer pensions will be able to reduce benefits paid to retirees under an amendment to the omnibus spending bill approved by the U.S. Senate on Dec. 13, two days after House passage. The bill now goes to the White House for an expected presidential signature.

The pension measure, which was negotiated by a bipartisan group of congressional leaders but opposed by some retiree advocates and their congressional allies, is intended to let deeply underfunded multiemployer plans avoid bankruptcy and termination, and by doing so to keep solvent the multiemployer pension insurance fund overseen by the Pension Benefit Guaranty Corp. (PBGC), the federal pension insurance program.

The provisions apply only to multiemployer pensions and not to single-sponsor corporate pensions, which are subject to a different set of regulations and higher funding-level requirements. The PBGC maintains a separate insurance fund for single-sponsor pensions. Multiemployer or "Taft-Hartley" pension plans commonly are administered by labor unions on behalf of their members and funded by multiple employers in a common industry, subject to collective bargaining contracts with the union.

As SHRM Online recently reported (see Multiemployer Pension Funding Crisis Looms), in November 2014 the PBGC issued a report indicating its multiemployer insurance program was almost certain to become insolvent in 10 years. Of the 1,400 multiemployer plans nationwide, 200 plans covering a total of 1 million participants are at risk of termination.

Cutback Provisions

The measure passed by the House would allow trustees of financially troubled multiemployer pensions to cut retiree benefits to prevent plan insolvency. Financially troubled plans are those that are expected to not have enough money to pay 100 percent of benefits in 10 to 20 years. In some cases, the cuts could exceed 60 percent of a participant’s benefits.

Under the measure:

Retirees who are age 80 or over, or are receiving a disability pension, are not subject to benefit cuts. Retirees ages 75-79 are subject to smaller cuts than retirees under age 75.

Plan trustees have discretion in deciding how to allocate the cuts. For example, they can cut retirees’ benefits more than those of active workers, and decide whether to reduce survivors’ benefits.

Plan trustees are exempt from fiduciary responsibility in making cuts.

Trustees’ decisions to cut benefits can only be reversed by the Department of Treasury, and then only if the Treasury determines that the trustees’ decision to cut benefits or the extent of the benefit cuts is “clearly erroneous.”

There is no provision for automatic restoration of lost benefits if a plan’s funding status improves.

Plans with 10,000 or more participants must allow all participants to vote on cuts before they are implemented. A majority of all workers and retirees in a plan—not just a majority of the ones who vote—is required to block cuts. Ballots can be distributed by e-mail.

Even if a majority of participants vote against cuts, the Treasury Department can override the vote and uphold the trustees’ decision to make cuts, if it concludes that a plan poses a “systemic” risk to the PBGC.

The insurance premiums that multiemployer plans pay to the PBGC are increased from $13 to $26 per participant per year. (In contrast, premiums paid to the single-employer plan program are between $57 and $475 per participant per year.)

Strong Responses

“The pension provisions in the spending bill allow trustees of financially troubled multiemployer pension plans to reduce benefits of retirees by as much as 60 percent if there is a projection that plan assets might be depleted in 10 to 20 years—when many of today’s retirees will no longer be alive,” according to a critical statement by the Pension Rights Center, an advocacy group for pensioners. “Also extremely troubling is the secretive process by which these provisions were pushed through Congress, buried in a must-pass bill in the last days of a lame-duck session, without input from the pensioners whose lives could be devastated by the cutbacks authorized by the measure. The process was undemocratic and unfair.”

In a letter to House and Senate members, AARP also opposed passage, stating that “Permitting plans to break the fundamental requirement of the Employee Retirement Income Security Act (ERISA)—that plans must honor pension promises for benefits already earned and vested—not only would hurt retirees, it would also significantly weaken ERISA and set an undesirable precedent. This precedent could have a detrimental impact on other earned pensions, and the overall retirement income security of the nation.”

Sen. Ron Wyden, D-Ore., said in a statement, “Under this bill, for the first time, Congress will allow multiemployer plans to cut retirees’ earned pension benefits. This is unprecedented and I worry about the impact on retirees and the slippery slope we’re about to head down.”

But Rep. George Miller, D-Calif., who along with Rep. John Kline, R-Minn., put together the coalition supporting the amendment, told the Washington Post, “We have to do something to allow these plans to make the corrections and adjustments they need to keep these plans viable.”

Randy G. DeFrehn, executive director of the National Coordinating Committee for Multiemployer Plans, an employer-union coalition, said in a statement that House passage of the measure “recognizes the years of work that America’s unions and employers did to develop a solution that doesn’t require a massive taxpayer bailout and instead provides a path forward for these troubled pension plans.”

smiller [at] shrm.org (Stephen Miller), CEBS, is an online editor/manager for SHRM. Follow him on Twitter @SHRMsmiller.

Related SHRM Articles:

Multiemployer Pension Funding Crisis Looms, SHRM Online Legal Issues, December 2014

Multiemployer Pension Plan Problems Aired, SHRM Online Benefits, November 2013

FASB Issues Update on Employer Disclosures for Multiemployer Plans, SHRM Online Benefits, September 2011

- See more at: http://www.shrm.org/hrdisciplines/benefits/articles/pages/multiemployer-...(SHRM+Online+Compensation+%26+Benefits+News)#sthash.iJfhUlGV.dp

Severely distressed multiemployer pensions will be able to reduce benefits paid to retirees under an amendment to the omnibus spending bill approved by the U.S. Senate on Dec. 13, two days after House passage. The bill now goes to the White House for an expected presidential signature.

The pension measure, which was negotiated by a bipartisan group of congressional leaders but opposed by some retiree advocates and their congressional allies, is intended to let deeply underfunded multiemployer plans avoid bankruptcy and termination, and by doing so to keep solvent the multiemployer pension insurance fund overseen by the Pension Benefit Guaranty Corp. (PBGC), the federal pension insurance program.

The provisions apply only to multiemployer pensions and not to single-sponsor corporate pensions, which are subject to a different set of regulations and higher funding-level requirements. The PBGC maintains a separate insurance fund for single-sponsor pensions. Multiemployer or "Taft-Hartley" pension plans commonly are administered by labor unions on behalf of their members and funded by multiple employers in a common industry, subject to collective bargaining contracts with the union.

As SHRM Online recently reported (see Multiemployer Pension Funding Crisis Looms), in November 2014 the PBGC issued a report indicating its multiemployer insurance program was almost certain to become insolvent in 10 years. Of the 1,400 multiemployer plans nationwide, 200 plans covering a total of 1 million participants are at risk of termination.

Cutback Provisions

The measure passed by the House would allow trustees of financially troubled multiemployer pensions to cut retiree benefits to prevent plan insolvency. Financially troubled plans are those that are expected to not have enough money to pay 100 percent of benefits in 10 to 20 years. In some cases, the cuts could exceed 60 percent of a participant’s benefits.

Under the measure:

Retirees who are age 80 or over, or are receiving a disability pension, are not subject to benefit cuts. Retirees ages 75-79 are subject to smaller cuts than retirees under age 75.

Plan trustees have discretion in deciding how to allocate the cuts. For example, they can cut retirees’ benefits more than those of active workers, and decide whether to reduce survivors’ benefits.

Plan trustees are exempt from fiduciary responsibility in making cuts.

Trustees’ decisions to cut benefits can only be reversed by the Department of Treasury, and then only if the Treasury determines that the trustees’ decision to cut benefits or the extent of the benefit cuts is “clearly erroneous.”

There is no provision for automatic restoration of lost benefits if a plan’s funding status improves.

Plans with 10,000 or more participants must allow all participants to vote on cuts before they are implemented. A majority of all workers and retirees in a plan—not just a majority of the ones who vote—is required to block cuts. Ballots can be distributed by e-mail.

Even if a majority of participants vote against cuts, the Treasury Department can override the vote and uphold the trustees’ decision to make cuts, if it concludes that a plan poses a “systemic” risk to the PBGC.

The insurance premiums that multiemployer plans pay to the PBGC are increased from $13 to $26 per participant per year. (In contrast, premiums paid to the single-employer plan program are between $57 and $475 per participant per year.)

Strong Responses

“The pension provisions in the spending bill allow trustees of financially troubled multiemployer pension plans to reduce benefits of retirees by as much as 60 percent if there is a projection that plan assets might be depleted in 10 to 20 years—when many of today’s retirees will no longer be alive,” according to a critical statement by the Pension Rights Center, an advocacy group for pensioners. “Also extremely troubling is the secretive process by which these provisions were pushed through Congress, buried in a must-pass bill in the last days of a lame-duck session, without input from the pensioners whose lives could be devastated by the cutbacks authorized by the measure. The process was undemocratic and unfair.”

In a letter to House and Senate members, AARP also opposed passage, stating that “Permitting plans to break the fundamental requirement of the Employee Retirement Income Security Act (ERISA)—that plans must honor pension promises for benefits already earned and vested—not only would hurt retirees, it would also significantly weaken ERISA and set an undesirable precedent. This precedent could have a detrimental impact on other earned pensions, and the overall retirement income security of the nation.”

Sen. Ron Wyden, D-Ore., said in a statement, “Under this bill, for the first time, Congress will allow multiemployer plans to cut retirees’ earned pension benefits. This is unprecedented and I worry about the impact on retirees and the slippery slope we’re about to head down.”

But Rep. George Miller, D-Calif., who along with Rep. John Kline, R-Minn., put together the coalition supporting the amendment, told the Washington Post, “We have to do something to allow these plans to make the corrections and adjustments they need to keep these plans viable.”

Randy G. DeFrehn, executive director of the National Coordinating Committee for Multiemployer Plans, an employer-union coalition, said in a statement that House passage of the measure “recognizes the years of work that America’s unions and employers did to develop a solution that doesn’t require a massive taxpayer bailout and instead provides a path forward for these troubled pension plans.”

- See more at: http://www.shrm.org/hrdisciplines/benefits/articles/pages/multiemployer-...(SHRM+Online+Compensation+%26+Benefits+News)#sthash.iJfhUlGV.dpuf

Severely distressed multiemployer pensions will be able to reduce benefits paid to retirees under an amendment to the omnibus spending bill approved by the U.S. Senate on Dec. 13, two days after House passage. The bill now goes to the White House for an expected presidential signature.

The pension measure, which was negotiated by a bipartisan group of congressional leaders but opposed by some retiree advocates and their congressional allies, is intended to let deeply underfunded multiemployer plans avoid bankruptcy and termination, and by doing so to keep solvent the multiemployer pension insurance fund overseen by the Pension Benefit Guaranty Corp. (PBGC), the federal pension insurance program.

The provisions apply only to multiemployer pensions and not to single-sponsor corporate pensions, which are subject to a different set of regulations and higher funding-level requirements. The PBGC maintains a separate insurance fund for single-sponsor pensions. Multiemployer or "Taft-Hartley" pension plans commonly are administered by labor unions on behalf of their members and funded by multiple employers in a common industry, subject to collective bargaining contracts with the union.

As SHRM Online recently reported (see Multiemployer Pension Funding Crisis Looms), in November 2014 the PBGC issued a report indicating its multiemployer insurance program was almost certain to become insolvent in 10 years. Of the 1,400 multiemployer plans nationwide, 200 plans covering a total of 1 million participants are at risk of termination.

Cutback Provisions

The measure passed by the House would allow trustees of financially troubled multiemployer pensions to cut retiree benefits to prevent plan insolvency. Financially troubled plans are those that are expected to not have enough money to pay 100 percent of benefits in 10 to 20 years. In some cases, the cuts could exceed 60 percent of a participant’s benefits.

Under the measure:

Retirees who are age 80 or over, or are receiving a disability pension, are not subject to benefit cuts. Retirees ages 75-79 are subject to smaller cuts than retirees under age 75.

Plan trustees have discretion in deciding how to allocate the cuts. For example, they can cut retirees’ benefits more than those of active workers, and decide whether to reduce survivors’ benefits.

Plan trustees are exempt from fiduciary responsibility in making cuts.

Trustees’ decisions to cut benefits can only be reversed by the Department of Treasury, and then only if the Treasury determines that the trustees’ decision to cut benefits or the extent of the benefit cuts is “clearly erroneous.”

There is no provision for automatic restoration of lost benefits if a plan’s funding status improves.

Plans with 10,000 or more participants must allow all participants to vote on cuts before they are implemented. A majority of all workers and retirees in a plan—not just a majority of the ones who vote—is required to block cuts. Ballots can be distributed by e-mail.

Even if a majority of participants vote against cuts, the Treasury Department can override the vote and uphold the trustees’ decision to make cuts, if it concludes that a plan poses a “systemic” risk to the PBGC.

The insurance premiums that multiemployer plans pay to the PBGC are increased from $13 to $26 per participant per year. (In contrast, premiums paid to the single-employer plan program are between $57 and $475 per participant per year.)

Strong Responses

“The pension provisions in the spending bill allow trustees of financially troubled multiemployer pension plans to reduce benefits of retirees by as much as 60 percent if there is a projection that plan assets might be depleted in 10 to 20 years—when many of today’s retirees will no longer be alive,” according to a critical statement by the Pension Rights Center, an advocacy group for pensioners. “Also extremely troubling is the secretive process by which these provisions were pushed through Congress, buried in a must-pass bill in the last days of a lame-duck session, without input from the pensioners whose lives could be devastated by the cutbacks authorized by the measure. The process was undemocratic and unfair.”

In a letter to House and Senate members, AARP also opposed passage, stating that “Permitting plans to break the fundamental requirement of the Employee Retirement Income Security Act (ERISA)—that plans must honor pension promises for benefits already earned and vested—not only would hurt retirees, it would also significantly weaken ERISA and set an undesirable precedent. This precedent could have a detrimental impact on other earned pensions, and the overall retirement income security of the nation.”

Sen. Ron Wyden, D-Ore., said in a statement, “Under this bill, for the first time, Congress will allow multiemployer plans to cut retirees’ earned pension benefits. This is unprecedented and I worry about the impact on retirees and the slippery slope we’re about to head down.”

But Rep. George Miller, D-Calif., who along with Rep. John Kline, R-Minn., put together the coalition supporting the amendment, told the Washington Post, “We have to do something to allow these plans to make the corrections and adjustments they need to keep these plans viable.”

Randy G. DeFrehn, executive director of the National Coordinating Committee for Multiemployer Plans, an employer-union coalition, said in a statement that House passage of the measure “recognizes the years of work that America’s unions and employers did to develop a solution that doesn’t require a massive taxpayer bailout and instead provides a path forward for these troubled pension plans.”

- See more at: http://www.shrm.org/hrdisciplines/benefits/articles/pages/multiemployer-...(SHRM+Online+Compensation+%26+Benefits+News)#sthash.iJfhUlGV.dpuf
 

Severely distressed multiemployer pensions will be able to reduce benefits paid to retirees under an amendment to the omnibus spending bill approved by the U.S. Senate on Dec. 13, two days after House passage. The bill now goes to the White House for an expected presidential signature.

The pension measure, which was negotiated by a bipartisan group of congressional leaders but opposed by some retiree advocates and their congressional allies, is intended to let deeply underfunded multiemployer plans avoid bankruptcy and termination, and by doing so to keep solvent the multiemployer pension insurance fund overseen by the Pension Benefit Guaranty Corp. (PBGC), the federal pension insurance program.

The provisions apply only to multiemployer pensions and not to single-sponsor corporate pensions, which are subject to a different set of regulations and higher funding-level requirements. The PBGC maintains a separate insurance fund for single-sponsor pensions. Multiemployer or "Taft-Hartley" pension plans commonly are administered by labor unions on behalf of their members and funded by multiple employers in a common industry, subject to collective bargaining contracts with the union.

As SHRM Online recently reported (see Multiemployer Pension Funding Crisis Looms), in November 2014 the PBGC issued a report indicating its multiemployer insurance program was almost certain to become insolvent in 10 years. Of the 1,400 multiemployer plans nationwide, 200 plans covering a total of 1 million participants are at risk of termination.

Cutback Provisions

The measure passed by the House would allow trustees of financially troubled multiemployer pensions to cut retiree benefits to prevent plan insolvency. Financially troubled plans are those that are expected to not have enough money to pay 100 percent of benefits in 10 to 20 years. In some cases, the cuts could exceed 60 percent of a participant’s benefits.

Under the measure:

Retirees who are age 80 or over, or are receiving a disability pension, are not subject to benefit cuts. Retirees ages 75-79 are subject to smaller cuts than retirees under age 75.

Plan trustees have discretion in deciding how to allocate the cuts. For example, they can cut retirees’ benefits more than those of active workers, and decide whether to reduce survivors’ benefits.

Plan trustees are exempt from fiduciary responsibility in making cuts.

Trustees’ decisions to cut benefits can only be reversed by the Department of Treasury, and then only if the Treasury determines that the trustees’ decision to cut benefits or the extent of the benefit cuts is “clearly erroneous.”

There is no provision for automatic restoration of lost benefits if a plan’s funding status improves.

Plans with 10,000 or more participants must allow all participants to vote on cuts before they are implemented. A majority of all workers and retirees in a plan—not just a majority of the ones who vote—is required to block cuts. Ballots can be distributed by e-mail.

Even if a majority of participants vote against cuts, the Treasury Department can override the vote and uphold the trustees’ decision to make cuts, if it concludes that a plan poses a “systemic” risk to the PBGC.

The insurance premiums that multiemployer plans pay to the PBGC are increased from $13 to $26 per participant per year. (In contrast, premiums paid to the single-employer plan program are between $57 and $475 per participant per year.)

Strong Responses

“The pension provisions in the spending bill allow trustees of financially troubled multiemployer pension plans to reduce benefits of retirees by as much as 60 percent if there is a projection that plan assets might be depleted in 10 to 20 years—when many of today’s retirees will no longer be alive,” according to a critical statement by the Pension Rights Center, an advocacy group for pensioners. “Also extremely troubling is the secretive process by which these provisions were pushed through Congress, buried in a must-pass bill in the last days of a lame-duck session, without input from the pensioners whose lives could be devastated by the cutbacks authorized by the measure. The process was undemocratic and unfair.”

In a letter to House and Senate members, AARP also opposed passage, stating that “Permitting plans to break the fundamental requirement of the Employee Retirement Income Security Act (ERISA)—that plans must honor pension promises for benefits already earned and vested—not only would hurt retirees, it would also significantly weaken ERISA and set an undesirable precedent. This precedent could have a detrimental impact on other earned pensions, and the overall retirement income security of the nation.”

Sen. Ron Wyden, D-Ore., said in a statement, “Under this bill, for the first time, Congress will allow multiemployer plans to cut retirees’ earned pension benefits. This is unprecedented and I worry about the impact on retirees and the slippery slope we’re about to head down.”

But Rep. George Miller, D-Calif., who along with Rep. John Kline, R-Minn., put together the coalition supporting the amendment, told the Washington Post, “We have to do something to allow these plans to make the corrections and adjustments they need to keep these plans viable.”

Randy G. DeFrehn, executive director of the National Coordinating Committee for Multiemployer Plans, an employer-union coalition, said in a statement that House passage of the measure “recognizes the years of work that America’s unions and employers did to develop a solution that doesn’t require a massive taxpayer bailout and instead provides a path forward for these troubled pension plans.”

- See more at: http://www.shrm.org/hrdisciplines/benefits/articles/pages/multiemployer-...(SHRM+Online+Compensation+%26+Benefits+News)#sthash.iJfhUlGV.dpuf

Severely distressed multiemployer pensions will be able to reduce benefits paid to retirees under an amendment to the omnibus spending bill approved by the U.S. Senate on Dec. 13, two days after House passage. The bill now goes to the White House for an expected presidential signature.

The pension measure, which was negotiated by a bipartisan group of congressional leaders but opposed by some retiree advocates and their congressional allies, is intended to let deeply underfunded multiemployer plans avoid bankruptcy and termination, and by doing so to keep solvent the multiemployer pension insurance fund overseen by the Pension Benefit Guaranty Corp. (PBGC), the federal pension insurance program.

The provisions apply only to multiemployer pensions and not to single-sponsor corporate pensions, which are subject to a different set of regulations and higher funding-level requirements. The PBGC maintains a separate insurance fund for single-sponsor pensions. Multiemployer or "Taft-Hartley" pension plans commonly are administered by labor unions on behalf of their members and funded by multiple employers in a common industry, subject to collective bargaining contracts with the union.

As SHRM Online recently reported (see Multiemployer Pension Funding Crisis Looms), in November 2014 the PBGC issued a report indicating its multiemployer insurance program was almost certain to become insolvent in 10 years. Of the 1,400 multiemployer plans nationwide, 200 plans covering a total of 1 million participants are at risk of termination.

Cutback Provisions

The measure passed by the House would allow trustees of financially troubled multiemployer pensions to cut retiree benefits to prevent plan insolvency. Financially troubled plans are those that are expected to not have enough money to pay 100 percent of benefits in 10 to 20 years. In some cases, the cuts could exceed 60 percent of a participant’s benefits.

Under the measure:

Retirees who are age 80 or over, or are receiving a disability pension, are not subject to benefit cuts. Retirees ages 75-79 are subject to smaller cuts than retirees under age 75.

Plan trustees have discretion in deciding how to allocate the cuts. For example, they can cut retirees’ benefits more than those of active workers, and decide whether to reduce survivors’ benefits.

Plan trustees are exempt from fiduciary responsibility in making cuts.

Trustees’ decisions to cut benefits can only be reversed by the Department of Treasury, and then only if the Treasury determines that the trustees’ decision to cut benefits or the extent of the benefit cuts is “clearly erroneous.”

There is no provision for automatic restoration of lost benefits if a plan’s funding status improves.

Plans with 10,000 or more participants must allow all participants to vote on cuts before they are implemented. A majority of all workers and retirees in a plan—not just a majority of the ones who vote—is required to block cuts. Ballots can be distributed by e-mail.

Even if a majority of participants vote against cuts, the Treasury Department can override the vote and uphold the trustees’ decision to make cuts, if it concludes that a plan poses a “systemic” risk to the PBGC.

The insurance premiums that multiemployer plans pay to the PBGC are increased from $13 to $26 per participant per year. (In contrast, premiums paid to the single-employer plan program are between $57 and $475 per participant per year.)

Strong Responses

“The pension provisions in the spending bill allow trustees of financially troubled multiemployer pension plans to reduce benefits of retirees by as much as 60 percent if there is a projection that plan assets might be depleted in 10 to 20 years—when many of today’s retirees will no longer be alive,” according to a critical statement by the Pension Rights Center, an advocacy group for pensioners. “Also extremely troubling is the secretive process by which these provisions were pushed through Congress, buried in a must-pass bill in the last days of a lame-duck session, without input from the pensioners whose lives could be devastated by the cutbacks authorized by the measure. The process was undemocratic and unfair.”

In a letter to House and Senate members, AARP also opposed passage, stating that “Permitting plans to break the fundamental requirement of the Employee Retirement Income Security Act (ERISA)—that plans must honor pension promises for benefits already earned and vested—not only would hurt retirees, it would also significantly weaken ERISA and set an undesirable precedent. This precedent could have a detrimental impact on other earned pensions, and the overall retirement income security of the nation.”

Sen. Ron Wyden, D-Ore., said in a statement, “Under this bill, for the first time, Congress will allow multiemployer plans to cut retirees’ earned pension benefits. This is unprecedented and I worry about the impact on retirees and the slippery slope we’re about to head down.”

But Rep. George Miller, D-Calif., who along with Rep. John Kline, R-Minn., put together the coalition supporting the amendment, told the Washington Post, “We have to do something to allow these plans to make the corrections and adjustments they need to keep these plans viable.”

Randy G. DeFrehn, executive director of the National Coordinating Committee for Multiemployer Plans, an employer-union coalition, said in a statement that House passage of the measure “recognizes the years of work that America’s unions and employers did to develop a solution that doesn’t require a massive taxpayer bailout and instead provides a path forward for these troubled pension plans.”

Categories: Labor News, Unions

Congress approves plan to allow pension cuts

Sun, 12/14/2014 - 08:14
CNN Money MovesCNN Money MovesDecember 14, 2014View the original piece

More than a million retired and current truck drivers, construction workers and other union workers could see their pension benefits cut now that Congress passed a proposal aimed at shoring up some of the nation's biggest pensions.

Tacked on as an amendment to the government's $1.1 trillion spending bill, the proposal was approved by the Senate late Saturday night.

While those sponsoring the pension proposal say it is "the only available option" to save failing multiemployer pension plans, other groups -- like the AARP and the Pension Rights Center -- are crying foul.

Multiemployer pension plans cover more than 10 million workers and retirees in the trucking, manufacturing and other industries. But many of these plans have struggled in the last decade as they grapple with an aging workforce and major investment losses from the recession. Plus, many larger employers have pulled out of the plans.

That has put a major strain on the Pension Benefit Guaranty Corporation, the government agency that insures pension plans, which last month said its reserves are dangerously low.

The Congressional proposal would allow plans that are projected to run out of money in the next 10 to 20 years to cut the benefits they pay to both current and future retirees. Benefits would not be cut for disabled pensioners or those 80 years and older, while cuts would be lessened for those between 75 and 80.

The PBGC projects that more than 10% of the roughly 1,400 multiemployer pension plans, which cover more than 1 million workers and retirees, currently meet this criteria.

Under current law, cutting the benefits of those who are already retired is off-limits. Instead, troubled multiemployer plans can take other actions, like reducing the benefits employees earn going forward and raising employee and employer contributions to the plan.

If the Congressional plan passes, cuts would require participant and government approval first, although the largest troubled plans could slash benefits even if retirees vote against it.

Retired truck driver Glenn Nicodemus, 64, receives his pension checks from the Central States Southeast and Southwest Areas Pension Fund, which is struggling to cover more than 300,000 retirees, widows and others.

Under the Congressional proposal, Nicodemus could see his annual benefits plummet from around $40,000 a year to as little as $15,000.

"I am disappointed in the fact that such an important matter is being done is such an underhanded way with little or no discussion of the consequences to millions who will be effected," he said.

Groups like the AARP, the Pension Rights Center and some worker unions say that retirees like Nicodemus are counting on their pension benefits, which they paid for through decades of contributions, and that other measures should be taken to save plans like Central States.

But supporters of the legislation counter that allowing for benefit cuts -- along with other changes included in the legislation, like allowing troubled plans to merge with healthier plans and doubling the insurance premiums employers pay the PBGC -- will help preserve the plans for both retirees and current workers.

One Cleveland plan, for example, has said it would only need to cut current benefits by 10% in order to prevent insolvency, said Randy DeFrehn, executive director of a coalition of employers and labor unions that crafted the proposal the legislation is based on.

Without any cuts now, he said that plan expects to run out of money by 2028, at which point all participants would see their benefits cut by 50% or more.

That's because if a multiemployer plan goes insolvent, a retiree is guaranteed less than $13,000 a year. In contrast, a retiree in a single employer plan that goes bust is insured for up to $60,000.

To make matters worse, the PBGC's multiemployer insurance program is itself projected to run out of money in the next decade unless changes are made -- meaning that workers and retirees in failing plans could be left with no benefits at all.

Categories: Labor News, Unions

It's Going To Get A Little Easier For Workers To Unionize

Fri, 12/12/2014 - 14:12
Dave JamiesonHuffington PostDecember 12, 2014View the original piece

WASHINGTON -- Federal officials unveiled new rules on Friday that will streamline and simplify the union election process, a reform long sought by labor unions and fiercely opposed by businesses.

Among other changes, the rules issued by the National Labor Relations Board will limit some of the litigation that can precede a union election, making it harder for parties to stall or drag out the process. The reforms will also allow unions to file election petitions and other documents via email, and they will require employers to provide unions with the email addresses and phone numbers of workers eligible to vote.

Many employers favor the older, slower election process, as it gives them more time to dissuade workers from unionizing. The reforms announced Friday have long been discussed and debated, and businesses have argued that they would infringe on the businesses' free speech rights and lead to "ambush" or "quickie" elections.

The labor board -- or at least its left-leaning majority appointed by President Barack Obama -- disagrees. In a statement Friday, the agency said the changes would "modernize" procedures and allow it to "more effectively administer" the laws on collective bargaining. In a sign of the partisan divide at play, the rules were approved by the board's three liberal members, while its two conservative members dissented.

Labor groups have long bemoaned the current process as outdated and tied up with red tape, giving employers ample time to bust unions. Companies often dispute which workers should belong in the bargaining unit -- that is, the people who would be covered by the union contract -- and the reforms announced Friday will shift that litigation to after the election. Employers will also have to prove that a review of the election is warranted, as opposed to merely requesting one.

Mark Gaston Pearce, the labor board's chairman, said in a statement that he was "heartened" that the board is enacting the amendments.

"Simplifying and streamlining the process will result in improvements for all parties," Pearce said. "With these changes, the Board strives to ensure that its representation process remains a model of fairness and efficiency for all."

The rules were announced in the Federal Register on Friday and will go into effect on April 14, 2015.

The board put forth a similar batch of rules more than three years ago, drawing heat from various business lobbying groups as well as congressional Republicans. After a federal court ruled that the board had lacked a quorum when it issued them, the board formally withdrew those rules early this year. It had been expected to reissue similar rules now that it has five confirmed board members.

Richard Trumka, president of the AFL-CIO labor federation, applauded the announcement of the rules Friday.

"The modest but important reforms to the representation election process announced today by the National Labor Relations Board will help reduce delay in the process and make it easier for workers to vote on forming a union in a timely manner," Trumka said in a statement.

Meanwhile, the National Retail Federation, an industry lobby, said it was considering "both a legal and legislative strategy" to block the rules from going into effect, calling them "the latest attempt by the Obama Administration to aid their allies in Big Labor at the expense of employers and employees."

Republicans in Congress have already held hearings on what they deem the "ambush" election rules and may well hold more once the GOP takes control of both chambers next year. They could potentially try to block the rules from going into effect -- though not in the immediate future, since members of Congress are already far along in hammering out a deal this week to fund the government. By waiting to release the rules Friday, the labor board may at least have avoided a GOP-sponsored rider in the spending bill that could gut the rules.

Categories: Labor News, Unions

FAQs: What the Pension Bill Means for You

Fri, 12/12/2014 - 12:03

December 13 2014: Get answers on the pension cut deal and what it means for you.

The ink is still drying on the pension cut deal that was attached in the dead of night to Congress's spending bill. Some FAQs can be answered now; TDU will provide updated information as it becomes available

Does this bill mandate pension cuts?

No. This bill permits “deeply troubled” pension plans, those which could become insolvent over the next 10-20 years, to cut already-earned pensions of retirees and active workers. These cuts will be up to the trustees of the pension fund; the trustees are 50% union officials, and 50% management reps. No cuts will go into effect immediately.

Could this affect other Teamsters, or just those in the Central States Pension Fund?

Most Teamster funds will be completely unaffected. The Western Conference Fund is in the “green zone.” Other large Teamster funds, such as New England, Local 705, Local 710, Local 804, Local 177, Joint Council 83, and most others will be unaffected, even if they are in the “red zone.” For example, Local 804 just won significant pension benefit increases in their recent contract.

Certain deeply troubled small Teamster funds may be affected. New York Local 707’s pension fund is nearly insolvent, as freight jobs dried up, and their biggest employer YRC got concessions to drastically cut their contributions to all pension funds. So we expect the Local 707 Fund to consider pension cuts.

How will it affect Teamsters in the Central States Fund?

The Director of the Fund, Thomas Nyhan, was a principal lobbying force for this bill, and has stated that CSPF will impose cuts on retirees and active Teamsters. The Trustees of the fund, who are 50% management and 50% Teamster officials politically aligned with Hoffa, support the bill and support cutting pensions. They will make the decisions on when, who, and how much to cut, within the bounds of the new legislation.

Have Central States officials indicated how much they will cut?

In the past, Al Nelson, the Benefit Services Director of Central States, stated that a cut of about 30% would be what is needed.

But now the legislation has changed that. It requires that workers (so-called “orphans”) who retired from companies that went bankrupt (such as CF, Allied Systems, Preston, or Hostess, for example)  be cut first and hardest.

This horrendous language is contained on page 81 of the pension legislation.

At this point, no one knows what the cuts will be, because we do not know how this legislation will be interpreted or applied. The next move will be by the Central States trustees.

The legislation also has protective language for some retirees: those over 80, those receiving only a disability pension, and to a partial degree, those who are 75-80.  

How will this affect UPS retirees in the Central States Fund?

UPS bought enough influence in Congress to save an estimated $2 billion through a special interest loophole that shifts the company's cost burdens on to Teamster retirees who will face additional pension cuts as a result.

On pages 81-82 of the pension legislation there is a loophole dedicated to exactly one corporation, UPS. This loophole means that CSPF will probably not be able to cut the pensions of UPS workers who retired after January 1, 2008, because they are “Priority 3” in order of cuts (the best priority).  

UPS retirees do not benefit one cent from this loophole because their pensions are already protected by the contract. Article 34, Section 1 of the current UPS master agreement, requires UPS to make up the full pension to UPSers if CSPF imposes cuts.  

UPS's special interest loophole means the company won't have to make up for any pension cuts. As a result, all non-UPS retirees will face $2 billion more in pension cuts. Retirees are footing the bill so that UPS doesn't have to pay the obligations it agreed to in the contract.

It is not known if the "UPS Exemption" also covers UPS Teamsters who retired from Central States before January 1, 2008. These Teamster retirees deserve to know their status and if they may face pension cuts.

Will Teamsters and retirees get a vote prior to any cuts?

A ‘fact sheet’ issued by the bills sponsors claims that workers and retirees will get a vote before cuts could be made. But this is not true because of additional loopholes in the deal.   

First, those in Central States can be deprived of a vote, because it is a large fund and its failure could seriously impact the Pension Benefit Guaranty Corporation (PBGC). 

To add insult to injury: a majority of all participants – not just voters – would be required for a No result. In other words, not voting would count as a vote in favor of a pension cut!

If Central States makes these cuts, will the fund be secure?

Maybe. Certainly slashing the benefits would improve the bottom line. But in the long run a pension plan needs contributing employers, and here is where the Hoffa administration has failed badly. They severely undermined the Fund by letting UPS pull out 45,000 participants, and they have not organized new companies into the fund. Central States set up a special “hybrid” kind of plan to allow new companies to join the fund with zero withdrawal liability. It was designed for organizing. But it has not been used for new companies. That has to change.

Will Teamster officials and Central States officials have to take cuts?

That remains to be seen. Because their work for the fund or local unions will not count as “orphan” time, they may or may not face cuts.  But Thomas Nyhan, the fund director, is paid $662,060, so he probably isn’t worried. Neither is Hoffa: he is in the lucrative Family Protection Plan, which pays far more than a working Teamster could dream of collecting.

Sign up for email updates at www.tdu.org and like us on facebook.

The Pension Rights Center’s backgrounder on the pension-cut bill

Issues: Pension and Benefits
Categories: Labor News, Unions

Congress, Hoffa Butcher Teamster Pensions

Fri, 12/12/2014 - 11:26

December 13, 2014: Congress has officially passed the spending bill that includes pension cut legislation that was attached as an amendment to the budget bill.

The legislation guts federal pension protections and will pave the way for pension cuts in the Central States Pension Fund.

Teamsters have questions and deserve answers. TDU lays out what the bill means for Teamsters in our Frequently Asked Questions. 

The biggest question of all may be: how did Hoffa let this happen in the first place?

While Hoffa was MIA or worse, TDU fought a grassroots campaign to protect Teamster pensions.

We partnered with the Pension Rights Center and AARP and launched a coalition for pension protections, not cuts.

We sounded the alarm when a Congressional sneak attack attached the pension cut deal to the end-of-year spending bill. Growing number of unions spoke out in opposition. We even forced the Hoffa administration to make a show of opposition.

The Hoffa administration was worse than MIA. His allies at the Central States Pension Fund were leading proponents of the pension cut deal. Central States Executive Director

Thomas Nyhan was a leading proponent of the pension cut deal. He was paid $662,060 by our pension fund last year. How big of a cut will he take?

Hoffa waited until the day before the legislation passed, Hoffa issued a last-minute letter opposing the pension rip-off. The IBT emailed members calling on them to make phone calls. This wasn't even a matter of too-little-too-late. It was a cover-up.

Hoffa stayed quiet to signal politicians that he backed the pension cut bill; then when the bill's passage was secured, he put on a show of opposition to the membership to cover himself politically.

Teamsters expect Congress to play politics. But they deserve more from their own union leadership. 

The Hoffa administration has spent the last year imposing contract concessions, healthcare cuts and pension cuts. It's time for change.

If you agree, get involved in the movement for change in our union.

Sign up for email updates at www.tdu.org and like us on facebook.

Send us a message and tell us what TDU should do next to fight for our union.

Join with Teamsters working to defend pensions, and change the leadership of the Teamster Union. Together, we can rebuild the Teamsters!

Issues: Pension and BenefitsHoffa Watch
Categories: Labor News, Unions

Will the Central States Big Shots Take a Cut?

Fri, 12/12/2014 - 11:10

December 12, 2014: Thomas Nyhan testified in Congress and lobbied hard – with our pension money and staff – to get the pension-cut bill passed. Now, he got his wish: a 163-page bill sneaked through Congress, tacked onto the budget. 

We propose some small measure of equality of sacrifice, which is a basic principle of the labor movement.  

The executives of the Central States Pension and Welfare Funds should take a 30% cut, to show their sincerity when they talk about the need for sacrifice.

Let’s start with Thomas Nyhan, who was paid $662,060 in 2013 and Al Nelson who was paid $305,811. There are plenty of other fund executives in their bracket: in our review of the 5500 forms for Central States Pension and H&W Funds, we found 13 pulling down over $200,000, and seven over $300,000.

What do you think?

Issues: Pension and Benefits
Categories: Labor News, Unions

Urgent: Congress to vote today on pension cuts

Thu, 12/11/2014 - 11:27

December 11, 2014: We need your help NOW! The House is poised to vote on the omnibus spending bill, which includes provisions that would allow pension plan trustees to cut the hard-earned pension benefits of current retirees – as a purported solution to shoring up certain financially-troubled multiemployer plans.

Click here to contact your members of congress and tell them to strip the pension cut ammendment from the omnibus bill.

Sign up for email updates at www.tdu.org and like us on https://www.facebook.com/teamstersforademocraticunion

Issues: Pension and Benefits
Categories: Labor News, Unions

Congress' backroom pension-cutting deal is even worse than expected

Thu, 12/11/2014 - 08:12
Michael HiltzikLos Angeles TimesDecember 11, 2014View the original piece

At last the actual language has been released of the backroom, last-minute congressional deal allowing benefits of millions of retired workers to be shredded.

It's even worse than its critics anticipated.

We've tracked this inexcusably hasty, secretive maneuvering during the last week, reporting that it allows extreme, potentially premature cuts in benefits for retirees who are members of multi-employer pension plans. Such plans typically are sponsored jointly by unions and employers in given industries, like trucking. See our posts here and here for more background.

Click here to read more at the Los Angeles Times.

Issues: Pension and Benefits
Categories: Labor News, Unions

Rep. Kline's proposed cuts catch pensioners by surprise

Thu, 12/11/2014 - 07:58
Jim SpencerStar TribuneDecember 11, 2014View the original piece

Dave Erickson of Isanti, Minn., believed his pension benefits were guaranteed when he contributed a fixed portion of his pay into the Teamsters Central States Pension Fund.

On Wednesday, Erickson learned that those benefits might be cut under a provision that Minnesota Rep. John Kline aims to tack onto the new federal budget bill.

Click here to read more at the Star Tribune.

Issues: Pension and Benefits
Categories: Labor News, Unions

Pension Fund Run By Wall Street Cited In Push To Cut Retiree Benefits

Thu, 12/11/2014 - 07:56
Matthew Cunningham-CookInternational Business TimesDecember 11, 2014View the original piece

Six years after the financial crisis, the economic aftershocks are still rattling the halls of Congress -- this time in a debate over an esoteric pension provision tucked into an end-of-year budget bill. Though that legislation, known as the “cromnibus,” is supposed to be about annual appropriations for government agencies, lawmakers have inserted language that would give private pension plans the power to cut benefits to thousands of current retirees whose pension savings were decimated by investment losses from the financial collapse of 2008.

If the initiative is enacted, experts say, it would be the most consequential change to retirement policy in the United States since the passage of landmark pension legislation 40 years ago. Altering the 1974 Employee Retirement Income Security Act to permit benefit cuts could prompt a slew of efforts to chip away at formerly untouchable guarantees of income to millions of retirees.

Click here to read more at The International Times.

Issues: Pension and Benefits
Categories: Labor News, Unions

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