Central States Fund Trustees Keep Pension and Health Care Cuts In Place

December 5, 2005: Hoffa’s PR Man dismisses the impact of the trustees’ actions: “Leebove said the changes at Central States and other pension funds should not be looked at as benefit cuts, since no accrued benefits were lost. Instead, he said, they represented reductions in future accruals that were designed to ensure the trusts are financially solvent for years to come."
–Bureau of National Affairs
November 9, 2005


The Union Trustees of the Central States Pension Fund have announced an agreement with employers and the IRS that will lock the 2003 pension cuts in place for years to come. Even worse, this deal will usher in more healthcare reductions—and lower wage increases when contracts are renegotiated.

Cuts Are Frozen in Place
At a Nov. 8 meeting of union officials, International Vice President and Trustee Chairman Fred Gegare told stunned officials that union trustees have agreed:
  • to maintain a long term freeze in the cuts to the Central States pension accrual rate
  • to not restore 25- and 30-and-out, which have been eliminated for younger Teamsters, and
  • to divert health and welfare money for 2007 to the pension fund, which will mean more cuts in medical benefits for Teamsters and retirees.

In addition, the Fund will require that all future contracts will have to include an increase in pension contributions of 7 percent in each year of the contract. Negotiating these huge hikes in pension contributions will divert money from wage increases and medical benefits—but Teamster members will see no pension improvements in return because our trustees have agreed not to increase the pension multiplier or restore 25- and 30-and-out benefits.

Over a month has passed since the meeting and members still have not received any information. This is our fund and our benefits that are at stake. But once again, the union trustees are keeping members in the dark.

No Accountability Is the Problem
The Hoffa administration keeps dragging out the same tired excuses. The stock market declined in 2000-2001, retirees live longer now, and there are more retirees than active members.

Is any of this big news? These are well-known facts. The reason we have Trustees is to manage these challenges—not to use them to justify cuts in our benefits.

TDU commissioned a comparison with other Teamster Funds, which showed that funds with the same demographics, and the same ratio of active Teamsters to retirees have weathered the “perfect storm” much better.

Instead of excuses, we need a positive plan to build up our pension fund and restore and protect our good pension benefits that all Teamsters can be proud of.

It’s time to fire the Trustees who are better at excuses than managing our pension fund.

Those characters need to be replaced. If our trustees won’t step down, then we need to put them into retirement by electing new leadership in the 2006 International Union election.

Click here: Apples and Oranges, or Just Rotten Apples?: Study Counters Central States' Claims
Click here: IBT Needs Plan for Countering Employer Attacks on Benefits
Click here: Battle Against Cut-Back Provision Will Move Into 2006
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