Central PA Pension Reformers Continue Struggle

July 15, 2002: The pressure is on! The Central Pennsylvania Teamster Pension Reform Committee is a force that will not be denied. Through lawsuits, mass meetings, media exposure, petitions, contact with influential public officials and regulatory agencies, tough questioning at union meetings and membership education, the committee has created a situation where the Teamsters, from Hoffa on down, have to deal with their critical pension problem.

For Teamsters in the Central Pennsylvania pension plan, any pension credits they have accrued prior to 1987 are in a defined benefits (DB) plan. Since 1987, the benefits are in a defined contribution (RIP) plan. When the switch was made all participants were assured by the fund trustees that the old DB plan was fully funded. The trustees were dead wrong. The old DB plan is anywhere between $103 and $160 million underfunded, with no additional revenues coming into it.

To make matters worse the trustees have botched up investments in good times and in bad. They are completely discredited in the eyes of the rank and file.

How to make up the money they need for the DB fund? The trustees have an idea — a bad one. Rather than going after the companies, they want to take from 20 to 35 percent, depending on age and years of service, of the pension contributions paid on behalf of fund participants under the age of 51 and divert that RIP money into the old DB plan to make up the deficit. Since the legality of such a move (taking one person’s guaranteed pension money and giving it to someone else) is highly dubious, this money is being held in an escrow account for the time being.

Facing a rank and file revolt, the Hoffa administration is pressing the Upstate New York pension fund to take the fund over. A formal proposal from the Upstate New York plan is expected within weeks. The Reform Committee, which has recently held mass meetings in Milton, Scranton and Harrisburg and has another scheduled for Reading, vows to carefully scrutinize the Upstate New York proposal.

Get Advice Join TDU Donate

Recent News

Yellow Trims Losses: Best Quarter in Six Years

Yellow Corporation released its first quarter financials on May 10. The company shows strong improvement but is still not profitable. Yellow’s overall operating ratio of 99.3 percent is 3 percent better than a year ago, but well below other LTL carriers, including ABF and TForce.

 

Sysco Profits Up

Sysco Corp announced its quarterly financial report on May 10, with profits and revenue both up dramatically since last year.  Profits for the quarter were $303.33 million, up from $88.9 million last year. Revenue rose 43% from $11.8 billion to $16.9 billion.

View More News Posts