April 9, 2008: After two months of demanding more information about the pension cuts in Local 355, members are finally getting some answers.
On March 1, the Local 355 plan cut the accrual rate for working members to zero. That means that members’ pensions are frozen and working Teamsters are earning zero retirement benefits for any of their hours worked since March.
Last weekend, Local 355 President Denis Taylor told the membership meeting that he personally expected benefits to improve in one year. When the cuts were announced in February, Taylor told members that the cuts could last three years or more. However Taylor also said the fund’s investments are down by about 6 percent already this year.
Taylor did not say how much he expected the benefits to be improved.
Since February, members have been demanding to know when the benefits will be improved—and what the local’s plan is to improve and protect the pension fund.
Several Teamster funds have lowered pension accruals, but cutting the accrual to zero is an extreme step.
Members Get Pension Info
Baltimore UPS feeder driver Gary Payne has obtained the Actuarial Valuation of the Local 355 fund. The report is a detailed look at the fund by independent actuaries.
In this document, prepared late last year, the actuaries warned the Local 355 fund trustees that the fund would be in the Red Zone by the end of March 2008 if the fund did not take action.
Under the Pension Protection Act, every pension fund will issue a report to members this year informing members of its funded status. Being in the Red Zone means the plan must adopt a funding improvement plan. With these cuts, Taylor says the fund is now in the Green Zone, which means the plan is well-funded.
This report was produced months before the pension freeze, but the Local 355 fund made it available only after members requested it under the terms of the new Pension Protection Act, which gives members the right to inspect certain plan documents.
“Any plan to start turning around our fund has to start with giving members more info about how the fund is doing,” Payne said. “We should have gotten this news sooner.”
The valuation does not recommend how big the cuts should have been, nor does it say how long cuts should last.
See the report for yourself. Click here to download the Local 355 Actuarial Valuation.
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