March 23, 2011: The Central States Pension Fund made it official today—they slashed the pensions of YRCW Teamsters by putting them on the “default schedule.” The news is going to hit YRC Teamsters hard.
YRC Teamsters still working or who retired after September 24, 2010, will be put on the Central States “default schedule” of benefits. This means no more 25- or 30-and-out, no more $100 per year accrual for pre-2004 years. The only pension earned will be the 1%/2% accrual, and it will be payable at age 65.
Those who retired prior to September 24 will be unaffected and retain their current benefit level.
Those retiring under 65 will be hit with a 6% per year reduction if they retire before July 1. After July 1, the penalty for retiring under 65 will be worse: for example, retirement at age 62 will mean a 26% reduction from a pension that has been already reduced.
There is a “grandfather clause” to partially protect Teamsters who reached age 55 by July 9, 2009, and who had 25+ years credit as of that date. They can retain their 25- and 30-and-out benefits, but only if they wait till age 62 to retire. If they retired after September 24, 2010 at less than age 62, they will be allowed to stop their payments till age 62, losing years of pension benefits if they retired early.
This is detailed in a five-page letter from Central States director Thomas Nyhan. This is must-reading for all affected Teamsters.
Numerous Teamsters have asked Teamsters for a Democratic Union (TDU) to explore any possible legal remedies, which TDU will do. But Central States is good at covering their rear when it comes to litigation.
Some 64 percent of YRCW Teamsters are covered by the Central States Fund. But others will be affected in various ways by actions of the other Teamster pension funds.
Reportedly the Western Conference of Teamsters Pension Trust is not going to accept the reduced payments from YRC. This will have an especially bad impact on those Western YRC Teamsters who had less than 25 years credit prior to July 2009, as the Western Fund will not allow early retirement for those with less than 25 years unless they have 1000 hours of credit in their last two years of employment.
Hoffa: Pension Protection or P.R.
These Teamsters have been led down a path of concessions, and never told where that path would lead. Hoffa, Tyson Johnson, the Central States Fund... none of them told the truth to YRC Teamsters. For example, if YRC had gone out of business instead of getting the pension concessions, no pensions would be reduced. Who was told that by Hoffa, Tyson Johnson, or the Central States Fund?
Hoffa came into office promising to “restore the power.” Instead he has consistently backpedaled, failed to organize, failed to protect the national contract or standards, and sold-out the pension fund to UPS management for his own political gain.
The loss of 44,000 UPS full-time Teamsters from the Central States Fund was the sell-out which put the Fund on the brink, and makes it harder for the fund to cut any slack to YRC Teamsters who have worked long and hard, and earned a good pension. A good pension many will not get, thanks to the sorry record of the Hoffa administration.
Will Hoffa fight to get this reversed? Right now his enormous PR staff is working on who to blame and how to spin it, not how to help YRC Teamsters. As for his pension? It will provide at least a million dollar payout, every penny of it from members’ dues.
The Central States bulletin regarding the default schedule is available here.