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About Northwest labor press. (Portland , Ore.) 1987-current | View Entire Issue (March 4, 2016)
PAGE 4 | March 4 , 2016 | NORTHWEST LABOR PRESS NATIONAL Teamsters retirees fight plan to cut Central States Pension benefits tiree meeting in Duluth to say By Larry Sillanpa Editor, Duluth Labor World he’s in their fight with them. The head of Central States DULUTH, Minn. (PAI) — A supports the application for ben- half mile from their union hall, efit cuts, but Teamsters President over 220 retired members of Jim Hoffa Jr. doesn’t. Hoffa Teamsters Local 346 gathered at strongly supports legislation (S. Holy Family Catholic Church in 1631) introduced last year by Duluth Jan. 21 to fight for their U.S. Sen. Bernie Sanders (I-Vt.), pensions. and U.S. Representatives Nolan But it’s not just a Teamsters and Marcy Kaptur (D-Ohio) to fight. As many as 200 multi-em- undo the Multi-Employer Pen- ployer pension funds covering 1.5 million American workers sion Reform Act. So do several other unions, notably the Ma- could be in jeopardy. The Multi-Employer Pension chinists. They argued hard Reform Act (MPRA) of 2014, against the law before Congress signed into law as part of the approved it. Retired Teamster Local 346 omnibus spending bill, gives Secretary-Treasurer Sherm Li- trustees of underfunded pension imatainen — part of the Duluth plans the green light to cut pen- area’s leadership group fighting sion payouts for current retirees — in order to save the funds go- the pension cuts — has traveled to Ohio, Illinois, and Wisconsin ing forward. Decades ago, the Teamsters to help the fight-back effort. “We have been betrayed by Central States Pension Fund was our fiduciary agents,” Li- one of the best union pension imatainen told the Duluth gath- funds in the nation. Teamsters ering. “[The Central States were retiring after 30 years of trustees] failed service to a to protect us signatory em- from Wall ployer and Street preda- “We told them to let taking home tors.” wage increases go, and pensions in Liimatainen the $3,000-a- put everything they said Wall Street month range. could into their pensions firms charged Central States so they’d have secure exorbitant fees trustees say retirements, ” Radzak said. and then used those days are Teamster pen- “And look what they got over: The sion funds to for it. It’s just not right.” Chicago- shore up weak based fund – Retired Teamsters Local 346 funds that they has been in Secy.-Treasurer Pat Radzak (the firms) had “critical” sta- created for their tus for some rich VIP in- time. vestors. Now In October, trustees notified Central States trustees are telling 273,000 retirees in 38 states that retirees the rescue plan is the one their pensions would be cut by and only solution. Trustees want as much as 50 to 70 percent. The retirees to vote “yes” for it in a “rescue plan” will ultimately af- “Participants’ Ratification fect 400,000 Teamsters and will decimate the pensions of many Process” that the Multi-Em- young members working today. ployer Pension Reform Act re- Trustees filed an application quires. Foes of the rescue plan with the U.S. Treasury Depart- say the whole idea is bogus, be- ment to begin cutting benefits cause no matter how retirees for current and future Teamster vote, the Treasury Department can go ahead and approve the retirees on July 1, 2016. pension cuts. Plus, not voting is To fight back, Teamster re- considered a “yes” vote, and tiree chapters have created Com- many retirees may not be mittees to Protect Pensions. healthy enough, or technologi- Committee members say it was cally savvy enough, to under- Central States managers and stand what is happening to their trustees, the Wall Street fund pensions. managers they used, and the fed- So the fight-back committees eral government that fell asleep are asking retirees to sign peti- at the wheel and caused most of tions against the plan and to vote the pension fund’s financial “no” so they could have legal sta- problems. tus to continue to challenge the Congressman Rick Nolan (D- cuts. The committees also cre- Minn.) attended the Teamster re- ated a Teamsters Pension Protec- tion Hotline, 1-888-979-9806, to allow retirees and members to urge lawmakers to pressure the Treasury Department to reject the Central States application. Workers’ pension committee members also say the Central States trustees allowed many employers to not make full pen- sion contributions by creating a “distressed employer” provision — and they didn’t offset those losses. The committees are call- ing for Central States trustees to resign — and thy want a federal investigation into how things got so bad. Under a 1989 consent decree, the government looked over everything the Teamsters did af- ter mob-related connections and illegal activity were uncovered. The consent decree was lifted just a year ago, ending 25 years of government supervision of the Teamsters. Retiree commit- tee members say the oversight flopped. They also fault the US. Department of Labor, the Treas- ury Department, and the Pension Benefit Guaranty Corporation (PBGC) for poor oversight. The PBGC was created in 1974 as part of the Employee Retirement Income Security Act (ERISA), a federal law that sets minimum standards for most pension and health plans in pri- vate industry to provide protec- tion for individuals in the plans. PBGC is supposed to protect pensions, but is almost insolvent itself. The agency’s looming fi- nancial crunch allows Central States trustees to argue that PBGC will be insolvent at the same time as their pension fund —in what the retirees call an- other excuse for the need for their “rescue plan.” Just in recent U.S. history, the federal government has bailed out savings and loans, Fannie Mae, Freddie Mac, the auto in- dustry, and Wall Street (“too big to fail”) banks. And it was the federal government that allowed PBGC to operate undercapital- 140 Cuts coming to some union pensions Under the Multi-Employer Pension Reform Act of 2014, trustees of severely distressed multi-employer pension plans can reduce benefits for current and future retirees — if doing so can save the plan from future insolvency. Plans are allowed to cut benefits if they’re forecasted to run out of money within 15 years (or 20 years if they have more than twice as many retirees as active workers). Benefits can’t be cut at all for retirees aged 80 or over, or who are receiving a disability pension, and retirees ages 75 to 79 are subject to smaller cuts than those under 75. And trustees are required to start the cuts with those whose employers went out of business or otherwise withdrew from the plan without paying all of their ized for 40 years, jeopardizing the retirement security of the taxpaying American workers it was created to protect. “We can fix this thing,” Con- gressman Nolan told the Local 346 retirees in Duluth. “By God, if we found a way to fix Wall Street when they needed it, we can fix the pensions of those who paid into them.” Nolan, Kaptur and 16 other House Democrats are urging Treasury to reject the Central States rescue plan. They are pushing the Keep Our Pension Promises Act (HR2844) to re- peal the Multi-Employer Pen- sion Reform Act and shore up the PBGC by closing two tax loopholes used almost entirely by wealthy estates to reduce their tax burdens. obligations. Trustees can’t cut benefits more than the amount needed to prevent insolvency. And no benefits can be cut below 110 percent of the amount guaranteed by the Pension Benefit Guaranty Corporation (PBGC) — its maximum benefit is $1,072.50 a month for a retiree with 30 years of service. The Treasury Department has received applications under the MPRA from Teamster Local 469 Pension Fund in New Jersey, and Iron Workers Local 17 Pension Fund of Ohio. The Pension Rights Center, an advocacy group, maintains a list of multiemployer plans that have notified the federal govern- ment that they are in “critical and declining” status, and could file proposals to reduce benefits. It currently has 52 entries. Another bill, the Pension Ac- countability Act (S2147, HR4029) would restore fairness and credibility in the voting process for pension cuts that may be proposed by plans. Pat Radzak, retired secretary- treasurer of Teamsters Local 346, said he was sick about what was happening to their retirees. “We told them forever to let wage increases go and put everything they could into their pensions so they’d have secure retirements,” Radzak said. “And look what they got for it. It’s just not right.” Broadway Floral for the BEST flowers call 503-288-5537 1638 NE Broadway, Portland
