The Future Under a UPS Plan: A Smaller Pension

October 17, 2007: Management and some union officials are selling the UPS Pension Plan in the Central States areas on the basis that it offers unreduced 25- and 30-and-out benefits of $2,000 and $3,000 respectively. That’s true, but also a very short term gain.

Looking into the future, this pension will pay less than Central States will pay, and far less than the Western Conference will pay. These are the two largest Teamster plans and cover most of the USA.

We won $3,000 30-and-out in the 1997 strike. Now UPS is offering the same thing in 2013, 16 years later.

By 2013, other Teamster pensions are going to be well beyond that figure and heading upward.  

Look at this chart of pension accruals, the amount you can add to your monthly pension for a year of service.

Notice that by August 2012, the Western Conference Pension Fund, covering all UPSers in the West, will be paying an accrual of $464 for a year for  UPSer with 20 years service. Payable at early retirement, in full.

Compare that to the $158.50 the UPS plan would offer! Even Central States will be well ahead of that with an accrual of $196. Central States will reduce that accrual by six percent for each year under age 62, but the UPS Plan would reduce it six percent for each year under age 65!

Do the math. You will see why UPS would pay $6.1 billion ($3.9 billion after a $2.2 billion tax write-off) to stick us in the plan. They will save billions in the long run, at the expense of your pension.

Why get into a plan that’s going to be paying a third rate pension to you, compared to the Teamster plans?

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