March 14, 2008: Trustees in the Maryland Local 355 Pension Fund have cut the fund’s annual accrual rate down to zero.
Last year, a UPS Teamster in the Baltimore fund earned an accrual of $191. But effective March 1, Local 355 members in the pension fund stopped earning any additional increase to their pension.
Denis Taylor, the head of Local 355, will not give members a timeline for when the freeze will end.
"Over 150 people came out for our meeting to discuss the pension, and many members spoke out against the freeze," said Gary Payne, a UPS feeder driver. "Members are demanding to know when our benefits will be restored, but our officials won’t give us straight answers."
The Local 355 plan covers over 3,500 around Baltimore. Teamsters on Maryland’s Eastern Shore are covered by a separate plan that has also seen cuts in recent years.
Fund in the Green Zone
At the union meeting, Taylor told the members that the fund is now in the "Green Zone", thanks to the pension freeze. Without the freeze, the fund would be in the "Yellow Zone", Taylor said.
Under the Pension Protection Act, every pension fund will issue a report to members this year (for most plans it will be in April) informing members of its funded status. The "green zone" means a plan is well-funded. The "yellow zone" means the plan is less than 80 percent funded and must adopt a funding improvement plan. Currently, the Local 355 plan is 81 percent funded.
Local 355 officials told members that the fund would have problems by 2009 if they did not cut the accrual to zero now.
Several Teamster funds have lowered pension accruals, but cutting the accrual to zero is an extreme step.
Officials are blaming the cut on the poor performance in the stock market since 9/11. Over the last eight years the fund has earned an average of 6.1 percent returns—less than the fund’s 8 percent target.
But for the last four years, the fund has averaged an 8.3 percent return—a little above the target.
Members are left wondering why these cuts are coming now, even though the biggest employers—UPS and freight—will be paying a good bit more into the fund starting Aug. 1.
"Last year, when we were voting on the new UPS contract, Denis Taylor came down to our center and told us to vote Yes for the contract," Payne said. "He told me personally that the money in the new contract would be enough to prevent a cut. He should have had a plan to protect our benefits; instead all he gave us was a sales job."
Members Launch Petition Drive
Concerned members have launched a petition drive to get answers and restore their benefits.
Members are getting signatures on the petition to demand to know what the union’s plan is to restore the cut.
You can help build the movement to restore our benefits by getting other UPSers to sign the petition. Click here to download the petition.
Click here to download a flyer you can post and distribute to other Local 355 Teamsters.
Stay in the loop. Click here to sign up for pension updates from Teamsters for a Democratic Union.
Please Note: You have the right to distribute flyers and get petition signatures on company property. You must only pass out flyers and get signatures in non-work areas during non-work times. If you’d like more information about your rights on the job, contact Teamsters for a Democratic Union at (718) 287-3283.