“GROW” Act: A Threat to Workers’ Pensions

A new threat to retirees and workers’ pensions was introduced in Congress last month: the misnamed “Give Retirement Options to Workers” Act. It does not give options to workers, but it could shift risk and uncertainty to some workers, and undermine stable pensions.

STOP-THE-RUSH-BANNER_thumb.jpgWhile the proposed bill (H.R. 4997) would have almost zero direct impact on Teamster pensions, we believe an injury to one is an injury to all. The only way to defend and expand pensions is with a united fightback of all unions and retiree organizations.

What is the “GROW” Act?

The proposed bill would allow well-funded multiemployer plans – those in the healthy “green zone” – to adopt a “hybrid” pension plan, which cuts out employer withdrawal liability, eliminates the safety net of the Pension Benefit Guaranty Corporation, and allows fund trustees to cut pensions whenever they deem it needed!

Who is Behind this Fake “Reform”?

Many employers of course favor the bill, because it would relieve them of responsibility for providing guaranteed pension benefits, and put all risk onto affected workers and retirees. But some union leaders also support it -- most of the Building Trades Unions of the AFL-CIO. The National Coordinating Committee for Multiemployer Pensions (NCCMP) is pushing the bill. This is the same group which authored and pushed the disastrous Multiemployer Pension Reform Act.

It is shameful that some unions are joining employers to sell-out pensions, when we need a united labor front to protect and expand pensions.

What Does it Mean for Teamsters?

In the direct sense, it means little for Teamsters. Very few Teamster pension plans are in the “green zone” and thus the proposed bill would not affect them. It would offer zero help to troubled plans, such as the Central States Pension Fund.

But the largest Teamster fund, the Western Conference of Teamsters Pension Trust, is in the green zone. The Western Fund’s assets are up to $42 billion; it is 92% funded and heading upward toward 100% funding in the next few years.

On the positive side, this means the present accrual rate of 1.2% may be raised in the near future. The accrual rate determines how much you earn on your pension for one year of work. For example, if your contract has a contribution rate of $5 per hour, or about $10,400 per year, you would add about $125 to your monthly pension for that year (or a bit less if your contract provides for PEER early retirement). So raising the accrual rate means a bigger pension boost every year; for example, if the accrual rate is raised to 1.8%, that $125 annual pension boost would go up to $187 (1.8% x $10,400)

The “GROW” Act and the Western Pension Fund

If the “GROW” Act becomes law, it would give the employers a tool to use in contract negotiations. They could propose that workers be transferred into the new, risky, hybrid plan. If all locals and officers in the West stand firm in local negotiations, it would mean no change. But the threat would be that some may break ranks.

That is one more reason to oppose this fake pension reform bill.

The Western Fund is holding meetings in all Western joint council areas in the next few weeks to inform officers, retiree groups and members of threats to pensions, and urge political action.

Unfortunately, Southern California Joint Council 42 has issued some mis-information, causing confusion among members. The bulletin, signed by JC 42 President Randy Cammack, states that the bill “will rob benefits from heathy multi-employer plans (such as the WCT pension) to fund other inferior plans.” There is nothing of that sort in this bill, and it is illegal to transfer funds from one plan to another. We agree with JC 42 on the need to mobilize against this bill, but spreading bad info and panic among members is not the way to do it.

It’s a bad piece of legislation that puts workers' pensions at risk.

Contact your Congressional Reps and Senators to Oppose H.R. 4997

Support the Pension Protection Movement 

Teamster Retiree Movement and Pension Right Center Oppose the “GROW” Act

GROW Act a Threat

Text of the Grow Act (H.R. 4997)

 


Showing 7 reactions

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  • Bruce Swearingen
    commented 2018-03-17 15:34:05 -0400
    Torches & Pitchforks Rally time
  • Joseph Taurisano
    commented 2018-03-17 13:19:33 -0400
    What there going to cut us again this can’t happen is this ever going to stop
  • Richard Dorrough
    commented 2018-03-16 20:02:40 -0400
    Also be advised the NCCMP is trying to weasel its way into the new committee.The American Academy of Actuaries have already sent the committee a request to act as advisors.See it here http://www.actuary.org/files/publications/Joint_Select_Committee_Multiemployer_Plans_Letter_03.12.2018.pdf .. Also see Testimony of:

    Josh Shapiro, Deputy Director for Research and Education
    National Coordinating Committee for Multiemployer Plans………………………….In addition to my role at the NCCMP, I serve on the American Academy of Actuaries Pension Committee, and on its Multiemployer Subcommittee.
  • Richard Dorrough
    commented 2018-03-16 19:48:43 -0400
    The Grow Act IS the NCCMP Composite Plan legislation they tired to back door on the 2016 omnibus bill and failed. It allows the Unions to create a new composite or defined contribution plan. JC 42 President Randy Cammack is NOT completely incorrect. They will rob from the existing fund by moving contributing signatory’s to the new fund and putting all NEW signatory’s into the new fund. If that is not robbery what is.Read the Ohio Carpenters application to Treasury. It details the UBC tanking the fund after seizing it in a forced merger.Read how many signatory contributing contractors the fund had before the new plan was created, Read how the UBC International, which under ERISA law has no legal right to tell individual funds what to do or who to invest with, told the fund to sit back and wait that MPRA was about to be passed and then they could apply for cuts.
  • Richard Dorrough
  • Richard Dorrough
    commented 2018-03-16 19:33:39 -0400
    The National Coordinating Committee for Multiemployer Pensions (NCCMP) is pushing the bill.The National Coordinating Committee for Multiemployer Pensions (NCCMP) WROTE this legislation It is their composite plan BS.Norcross and Roe have lied to the American people when they claimed this as their own. The NCCMP has posted on their site>>"THIS LEGISLATION IS THE CULMINATION OF MANY YEARS OF WORK BY THE NCCMP "

    http://nccmp.org/…/Multi-Elert-Vol-18-Issue-3-Introduction-…

    SUMMARY:
    THE NCCMPIS PLEASED TO REPORT THE INTRODUCTION OF H.R.4997,
    THE BIPARTISAN GROW ACT
    .
    THE GROW ACT STRENGTHENS AND MODERNIZES THE
    MULTIEMPLOYER PENSION SYSTEM FOR THE FUTURE THROUGH THE CREATION OF GROW
    (COMPOSITE)PLANS AT A TIME WHEN THE S
    TAKES COULD NOT BE HIGHER
    .
    DESPITE SUPPORTING 13.6 MILLION
    AMERICAN JOBS IN 2015 AND CONTRIBUTING $158
    BILLION IN FEDERAL TAXES AND MORE THAN
    $1 TRILLION TO U.S.GDP,TODAY THE SYSTEM FACES UNCERTAINTY AND INSTABILITY
    .
    THE GROW ACT WILL HELP SAFEGUARD THIS ECONOMIC ENGINE BY BETTER PROTECTING
    WORKERS

    RETIREMENT SECURITY AND PROVIDING GREATER CERTAINTY AND STABILITY TO EMPLOYERS IN THE MULTIEMPLOYER SYSTEM
    .
    THIS LEGISLATION IS THE CULMINATION OF MANY YEARS OF WORK BY THE NCCMP AND THE MULTIEMPLOYER COMMUNITY AND IS THE FINAL PIECE OF THE THREE PART RECOMMENDATIONS
    DEVELOPED DURING THE RETIREMENT SECURITY
    REVIEW COMMISSION
    .
    THE NCCMP APPLAUDS REPS
    .
    ROE AND NORCROSS FOR THEIR LEADERSHIP IN INTRODUCING THIS LEGISLATION
    .
    WE LOOK FORWARD TO CONTINUING TO WORK WITH CONGRESS TO PROTECT THE FUTURE OF MILLIONS OF AMERICAN WORKERS AND SWIFTLY PASS THE GROW ACT WITHOUT DELAY..

    Trumka and the AFL-CIO are financing the NCCMP giving them close to a half million ($500,000) a year to destroy UNION retirees.Check their LM2s
  • Frank Halstead
    commented 2018-03-16 19:02:07 -0400
    This legislation allows employers and weak union leaders to destroy pension plans. We must fight against it.
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