April 2, 2007: Assets at the Western Conference of Teamsters (WCT) Pension Trust now top $29 billion and the trust is 100 percent fully funded. But hundreds of thousands of Teamsters covered by the plan are still facing a nearly 40 percent cut in their pension multiplier. Why? And when will our pensions be fully restored?
The already-flush WCT Pension Trust is headed for another major influx of cash. In the next UPS contract, the company will very likely increase its pension contributions by a minimum of $2.40 an hour, assuming a five-year agreement.
That minimum figure is the result of a new Central States Pension Fund regulation that requires an eight percent increase in pension contributions every year just to stay in the fund.
Teamsters Losing $500/Month and Counting
Benefit contributions are negotiated nationally, so the Western Fund will likely get at least this amount also. That means contribution increases starting at a minimum of 40¢ per hour the first year and reaching at least 60¢ by the fifth year if the contract. That’s compared to just 35¢ an hour increases in the last contract.
In 2003, Teamster trustees, including General Executive Board members Randy Cammack, Al Hobart, Chuck Mack and Jim Santangelo, voted with employers to drastically slash the pension multiplier by more than half, to 1.2 percent, down from 2.65 percent.
These cuts have already reduced the pension check of UPS and Freight Teamsters by $500 a month for the rest of their retirement.
Trustees to the Western Fund voted to slightly raise the multiplier to 1.65 percent last October. But this rate still represents a 38 percent cut over the historic minimum rate of 2.2 percent.
The typical Western Teamster will lose another $100 per month off of their monthly pension check for every year the current cut remains in place.
Now Is the Time
The bad news for our pensions is good news for the employers. Our fund’s website features an announcement to participating employers that 100 percent funding means that they can withdraw their companies from the pension plan without having to pay any liability.
Working Teamsters get continued pension cuts. But a company that wants to bust out of our union’s largest pension plan can do so without paying a dime. What is wrong with this picture?
When the trustees slashed the pensions in 2003, they claimed it was because the stock market dip had caused the funding level to drop. The WCT pension trust was never less than 80 percent funded and thousands of Teamsters signed petitions saying the cuts were unnecessary.
Now there is nothing to debate. With the trust 100 percent funded and more cash on the way, the money is there to fully restore pensions in the West before working Teamsters lose another dime.
This issue affects the pocket-book of every Teamster. As long as employers can maintain pension cuts in the WCT Pension Trust, then Teamster members will find it that much harder to win pension increases in other benefit funds.