NORTHWEST LABOR PRESS | June 15, 2018 | PAGE 3
RETIREMENT
Western States OPEIU Pension moves to cut benefits
Without a 30% pension cut, the
fund will be insolvent in 18 years.
A union pension plan for office
workers is applying to the U.S.
Treasury Department for per-
mission to cut retiree benefits up
to 30 percent in order to halt a
slide to insolvency. Portland-
based Western States Office and
Professional Employees Pension
Fund covers 7,400 current and
former members of nine Western
United States locals of Office
and Professional Employees In-
ternational Union (OPEIU).
They’re mostly clerical staff at
labor unions and defunct or no-
longer-unionized trucking com-
panies.
Until 2014, multi-employer
pension plans like Western States
weren’t allowed to reduce bene-
fits for workers who were already
retired. But a law passed that year
allows pensions to cut retiree
benefits to a certain extent if that
can prevent insolvency. The law
says pension cuts must progres-
sively phase out for retirees aged
75 to 80, and benefits can’t be cut
at all for those 80 and over.
Pension plan participants get to
vote on the proposed cuts, but can
only stop the cuts if a majority of
total participants vote to reject
them — not just a majority of
those voting.
Retiree Evangelyn Huntington
calls that outright majority re-
quirement a “fraud of the highest
order.” Huntington went to work
at the Portland headquarters of
Consolidated Freightways in
1978 as a mainframe computer
operator, and stayed when her di-
vision was spun off as CNF
Transportation in 1996. In 2003,
angry over the role played by
OPEIU Local 11’s leader in the
Capital Consultants fraud case,
she and her co-workers voted to
decertify Local 11 and go non-
union. That 132-106 vote meant
the Western States pension fund
lost it’s largest remaining em-
ployer, with 257 employees.
Once-mighty trucking company
Consolidated Freightways had
gone bankrupt the year before,
ending pension contributions for
about 400 union office workers.
Western States is typical of the
roughly 100 union-sponsored
multi-employer pension plans
that are currently heading for in-
solvency— in that its investments
lost value in the 2000 and 2008
financial crashes, but it can’t re-
cover from those losses because
retirees and former employees
greatly outnumber active workers
whose employers are making
contributions to the plan. Western
States today has 11 times as
many retirees and vested former
workers as current workers.
Retirees came to greatly out-
number active employees be-
cause of a long slow decline in
OPEIU membership. Computer-
ization reduced the number of of-
fice workers needed. Local
unions that employed OPEIU
members were themselves de-
clining in members, and merged
and laid off office staff. Office
staff at unionized trucking firms
were laid off when their firms
went out of business, or like CNF,
voted to go non-union. In the
mid-1980s, Western States had
over 500 contributing employers.
Today it has 168.
Now, its participants are pre-
sented with a choice between
evils: Painful cuts now, or even
more painful cuts in 18 years.
Without the cuts, Western States
will run out of money by 2036.
If Huntington is still around
then, she’ll be 87. She plans to
vote against the cuts, which for
her amount to over $500 a month.
She was 61 when she retired.
Since then her health has wors-
ened and she doesn’t feel she can
return to the workforce.
“To us that are retired, this
guarantee is what we based
everything on, and now they’re
saying they’re going to take it
away,” Huntington said. “What
am I going to do? If I get it re-
duced now, there goes any little
cushion I have if anything goes
wrong.”
Meanwhile, retired union
bookkeeper Christie Gronquist
says she plans on voting for the
cuts, to avoid having to suffer the
bigger cut later. Gronquist, also a
member of OPEIU Local 11,
took early retirement in 2008 at
age 57. After 29 years as book-
keeper, first at Machinists District
Lodge 24, then United Food and
Commercial Workers Local 555,
she gets a $1,283 a month pen-
sion. That will drop to $1,140 a
month under the proposed cuts.
[It’s not the full 30 percent be-
cause of a rule that cuts can’t go
below 110 percent of a federally
insured minimum.]
“It’s not going to kill me,”
Gronquist says. “It just kind of
breaks your heart that you plan
on that and then it gets cut.”
Western States’ May 15 appli-
cation to the U.S. Treasury De-
partment was actually its third at-
tempt. The previous two were
withdrawn on the advice of
Treasury officials for technical
reasons. Once the Treasury De-
partment approves the applica-
tion as expected, a vote by mail
will take place within 30 days. If
it isn’t rejected by a majority of
participants, the cuts will take ef-
fect Oct. 1.
WHO’S AFFECTED?
For Oregon and SW Washington,
pension cuts proposed by Western
States OPEIU Pension Fund would
affect current and former office staff
at the following local unions and
OPEIU-represented employers:
Catholic Archdiocese of Portland
Asbestos Workers Local 36
Assn. of Western Pulp & Paper Workers
Bakers Local 114
Boilermakers Locals 242 and 500
Cement Masons Local 555
Columbia-Pacific Building Trades
Consolidated Freightways
CNF/ConWay
CWA Local 7901
Machinists District Lodge W-24
IBEW & United Workers Credit Union
IBEW Local 48
ILWU Locals 40 and 8
Ironworkers Local 29 and 516
Painters District Council 5
Laborers Local 483
Labor’s Community Service Agency
Linoleum and Carpet Layers Local 1236
Machinists/Boilermakers Credit Union
Manor Management Services
NECA-IBEW Training Trust
Northwest Labor Press
Northwest Natural Gas
Northwest Oregon Labor Council
OPEIU Local 11
Oregon Federation of Nurses
Oregon State Building Trades Council
Oregon AFL-CIO
Pacific NW Ironworkers Credit Union
Pacific NW Council of Carpenters
Painters Local 10
Portland Local 8 Credit Union
Sheet Metal Workers Local 16
UA Local 290
UA Local 290 Training Trust
UFCW Local 555
Bernie to Disney:
Give your workers a raise
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At a packed June 2 union rally,
one of America’s most popular
politicians said it’s time Disney
paid $15 an hour to workers at its
Anaheim theme park and resort.
“If a corporation like Disney
has enough money to pay its
CEO over $400 million in a four-
year period, it damn well has
enough money to pay its workers
at least $15 an hour,” Vermont
Sen. Bernie Sanders told 1,500
unionized Disneyland employ-
ees.
The rally came after a 13-
union coalition turned in 21,000
signatures to qualify a local bal-
lot measure in November that
would establish a $15 an hour
minimum wage effective Jan. 1,
2019, with a $1 increase each
subsequent January until 2022
— for any employers accepting
city subsidies.
Anaheim City Council gave
Disney a tax break in 2016 val-
ued at $267 million over the next
20 years. Disney reported $9 bil-
lion in profit last year, and this
year president Trump’s corporate
tax cut is reducing its tax rate
from 35% to 21%.
Yet for the 125,000 of its full-
and part-time employees who are
union-represented, Disney’s cur-
rent contract offer is to increase
its starting wage from $11 to
$13.25, to $15 by the year 2020.
“The struggle that you are
waging here in Anaheim is not
just for you,” Sanders said. “It is
a stuggle for millions of workers
all across this country who are
sick and tired of working longer
hours for lower wages, of not be-
ing able to find decent housing
they can afford, and of not hav-
ing adequate health care.”