Part-Time Pension Puzzle

I recently heard that some part-timers at UPS are in Teamster pension plans. As a part-timer I was in the company plan. After I went full-time, I didn’t get any credit toward my Teamster pension for my part-time years. After Central States announced the pension cuts, they said there are not enough active workers in the Fund. Then why aren’t the part-timers in the fund?
–UPSet at UPS


Dear UPSet,

What you heard is true. UPS part-timers are in Teamster pension plans in two of our union’s biggest pension plans, the Western Conference and New England, and they are also in the Upstate NY Plan. This dates prior to1979, when UPS contracts were regional and local.

When part-timers are in the company plan, it’s lose-lose just like you said. When you go full-time, your part-time pension credit doesn’t follow you. The small pension that comes from part-time years isn’t much. Reciprocal benefits with Teamster plans help members qualify for 30 & Out—but the monetary value of our part-time years is pathetic. In areas where part-timers are in the Teamster plans, members get a much better deal.

The fact is most part-timers don’t qualify for any pension, because it takes five years of part-time work to vest in the UPS pension plan.

Where do their pension contributions go? Where part-timers are in the company plan, that money goes right into the company’s pocket. But in the West and the Northeast, it stays in the pension fund where it benefits other Teamsters.

If part-timers were in the Central States Fund, UPS would pay approximately $140 million more per year in pension contributions to the fund.

The result would be a stronger pension fund for everyone and pension credit for our part-time years. Win-win instead of lose-lose.

As part of the fight to reverse the pension cuts and restore the long-term health of our Teamster pension plans, we should be working to include all UPS part-timers in Teamster pension plans in the 2008 negotiations. If UPS can do it in 18 states, they can do it in 50 states.

 

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