July 1, 2010: The New York State Teamsters Pension Plan will end 25-and-out and 30-and-out benefits at the end of the year, due to the fact that the plan is underfunded and in the “red zone.”
The fund, which covers Teamsters in most of New York State (but not New York City), has good benefits. For example, UPS workers can retire with 30-and-out at $5,500 per month. This is nearly double the amount paid by the UPS company plan, which covers 25 states in the south and central regions.
Effective January 1, 25- and 30-and-out benefits at any age will end, as part of the fund’s “rehabilitation plan” to start to get it back to full funding.
The rehabilitation plan’s summary has five options, which each require increased employer contributions bargained in contracts.
The five options increase the age for unreduced 30-and-out to 55, 57, 60, 62 or 65.
In addition to increasing the age for unreduced 30-year benefits, the rehabilitation plan cuts the annual pension accrual, the amount that pensions improve each year.
The fund and the local unions are holding educational meetings across the state to inform members of the situation and the options faced by each bargaining unit.
There could be votes by members in some bargaining units later this year on various options.