November 21, 2013: Growing opposition to a proposal to allow multi-employer pension plans to slash already-earned benefits has forced a delay in its introduction into Congress. That opposition needs to grow stronger, into a grassroots movement to save our pensions and develop a positive alternative plan to the cuts.

A bill was scheduled to be introduced in the US House of Representatives over a month ago to allow "deeply troubled" pension funds—such as the Central States Fund—to cut the pension benefits of retirees and those soon to retire. But opposition has slowed it, at least for now.

We're out to stop this bill to protect Teamsters and other workers who worked long and hard to earn their pensions. If they revoke the ERISA anti-cutback rule and could then cut some pensions, the door will be open to slash more pensions of Teamsters and other workers who earned a good retirement with a lifetime of honest work.

This bill has the support of employers and the Central States Pension Fund. Central States Director Thomas Nyhan was the star witness in favor of changing the law to allow pension cuts at the Congressional hearing held on October 29. He testified that Central States could become insolvent in 10-15 years.

Time for Action

Opposition to the bill, spearheaded by the Pension Rights Center, the AARP, TDU, and some unions has grown. Just hours before the October 29 hearing, Teamster president James Hoffa did a 180 and issued a letter in opposition to the proposal, calling for a movement to stop it.

This statement by Hoffa is welcome. Now is the time for Teamster locals, retiree clubs and members and retirees to get involved in building that movement. 

If you want to be part of the solution, contact TDU.

What’s at Stake

Tell Congress to keep the ERISA anti-cutback rule to protect the pension you earned. Ask your representatives to support the AARP proposals. And pass on info from the TDU website to other active and retired Teamsters.

Read what Teamsters have to say in "We Earned Our Pensions."

Read more about the issue: TDU’s statement to Congress, and what’s at stake.

Join the growing movement of retirees and active Teamsters who are working with the TDU Pension Action Network to protect our pensions.

Contact your Representatives

Click here to tell your Senators and Congressional Representatives to vote NO on any plan to allow earned pensions to be cut. This site, sponsored by the Machinists Union, will allow you to send an email message right away to your Senators and Reps.

Click here for a list of Congressional Reps on the Education and Workforce Committee who will take up the bill, and for how to send them a note urging a NO vote.

Hundreds of thousands of reitred union workers are facing pension cuts that could slash their monthly payments in half or even more.

The proposed cuts are part of a desperate effort to head off insolvency at multiemployer pension plans, pensions that typically provide benefits for workers at several companies.

It's an unconventional move: Pension law has long maintained that cutting the benefits of those already retired is off-limits. Current law allows troubled multiemployer plans to reduce the benefits that employees earn going forward, cut early retirement and disability benefits and hike employer contributions instead.

But things have gotten so dire that a coalition of employers and labor unions is asking Congress to change the law.

Multiemployer pension plans cover more than 10 million workers and retirees in the trucking, construction, retail, mining, manufacturing and other industries. Historically, the plans were considered more secure since multiple employers pay into the plans instead of relying on the fortunes of just one company.

But in the past decade, many plans have struggled with supporting an aging workforce, and large employers have been pulling out of the plans. In addition, many are still dealing with significant losses incurred during the recession.

The proposal would allow cuts for those plans that are closest to insolvency. According to the Pension Benefit Guaranty Corporation, which insures pension plans, up to 10% of the roughly 1,500 multiemployer plans will run out of money in coming decades.

If cuts are allowed, retired truck driver Glenn Nicodemus, 63, could see his monthly benefits fall from around $3,300 a month to as little as $1,180. He retired in March after nearly 40 years on the road, and his only other source of income is $1,700 a month in Social Security benefits.

"I probably could get a job driving again. I really don't want to," he said. "These are the years I was looking forward to being together (with my family) and enjoying what time I do have left. It takes a lot of that away."

Nicodemus receives his checks from one of the country's largest multiemployer plans, the Central States Southeast and Southwest Area Pension Fund, which is also one of the most troubled. The fund is projected to become insolvent in the next 10 to 15 years. If cuts are allowed, the fund's more than 200,000 retirees could see their checks slashed by as much as 60%.

"Without timely intervention, workers in the most deeply troubled plans are at risk of seeing the benefits they have earned drastically reduced," Thomas Nyhan, executive director of the Central States pension fund said at a recent Congressional subcommittee hearing.

The PBGC guarantees a significantly lower benefit level for participants in multiemployer plans than it offers for single employer plans, since employers in multiemployer plans pay much lower premiums. So retirees could ultimately see drastic benefit reductions either way.

If a multiemployer plan goes insolvent, a retiree is guaranteed $12,870 a year at most, which is slightly less than the minimum benefit allowed under the proposed cuts. In contrast, a retiree in a single-employer plan is insured for up to $59,320 a year.

Groups like the AARP, the Pension Rights Center and an increasing number of unions oppose the proposed cuts. They say that retirees are counting on their pension benefits, which they were promised through decades of union contracts.

They argue that other solutions should be considered, such as allowing troubled plans to merge with healthier plans and raising the insurance premiums employers pay the PBGC.

"This is unprecedented," said Karen Ferguson, director of the Pension Rights Center, a nonprofit advocacy group. "These retirees in most cases are barely scraping by with their pension and Social Security benefits. It would be devastating to them."

Official legislation is likely to be introduced in Congress in coming months. In the meantime, hundreds of thousands of retirees are left unsure whether their pension benefits are safe.

"I'm very, very concerned," said 69-year-old Jim Carothers, a Central States' retiree. "I've lost a lot of sleep over it."

UPDATED October 29, 2013: Opposition to the proposal to amend pension law to allow retirees' pensions to be cut is growing and gaining force to slow down this train wreck and allow consideration of other options.

As reported in Pension and Investments, the growing opposition was in evidence at a Congressional hearing held on the proposal today. Click here to watch a video of the testimonies.

Click here to tell your Senators and Congressional Representatives to vote NO on any plan to allow earned pensions to be cut. This site, sponsored by the Machinists Union, will allow you to send an email message right away to your Senators and Reps.

Click here for a list of Congressional Reps on the Education and Workforce Committee who will take up the bill, and for how to send them a note urging a NO vote.

We expect a bill to hit Congress very soon which would allow "deeply troubled" pension funds—such as the Central States Fund—to cut the pension benefits of retirees and those soon to retire.

We're out to stop this bill to protect Teamsters and other workers who worked long and hard to earn their pensions. If they revoke the ERISA anti-cutback rule and could then cut some pensions, the door will be open to slash more pensions.

This bill has the support of employers and the Central States Pension Fund. Central States Director Thomas Nyhan was the number one advocate at the Congressional hearing yesterday; he testified that Central States could become insolvent in 10-15 years.

You can read TDU's statement on the issue; we support more positive options, including public funding of the PBGC, before considering drastic pension cuts.

Less than 24 hours prior to the hearing, the Hoffa administration turned around 180 degrees and come out against changing the anti-cutback rule. Hoffa issued a three page letter which cites the same positive AARP proposals described in TDU's testimony.

Hoffa refers in his letter to the need to "fight for changes that will ensure that the right to a dignified retirement is sacrosanct." It's time to put the IBT muscle and funding into building a movement to do just that. Let's do it!

The Machinists, Boilermakers, Steelworkers and other unions announced opposition.

We join with others in opposition to changing the anti-cutback rule. You read the proposals put forward by the Pension Rights Center and AARP.

If you want to oppose this bill, the time is now to take action.

Tell Congress to keep the ERISA anti-cutback rule to protect the pension you earned. Ask your representatives to support the AARP proposals. And pass on info from the TDU website to other active and retired Teamsters.

Read what Teamsters have to say in "We Earned Our Pensions."

Join the growing movement of retirees and active Teamsters who are working with the TDU Pension Action Network to protect our pensions.

October 17, 2013: Hoffa and Hall have lied to members about our contracts and healthcare. But in the fight to protect our benefits, we shouldn't turn against union health plans.

Given all of Hoffa-Hall's lies about Teamster contracts, it's no wonder that many members don't trust the union to run our health plan.

But in the fight to protect our benefits, we shouldn't turn on union health plans.

The fact is union health plans work. They benefit millions of Americans. They have strong advantages over company plans and for-profit insurance companies.

Union health plans are efficient and don't skim money away from benefits to pay profits, high executive salaries or costly advertising.

Not one dime of health plan money goes to the union, to union officials or to the employers.

The Central States Health and Welfare Fund pays 94 percent of its income in members' benefits. General administrative costs take 3.2 percent. TeamCare administration costs are 2.8 percent. (TDU went to court to make quarterly Central States financial reports available. The most recent one is available here.)

Union health plans are jointly governed: 50 percent by corporate trustees and 50 percent by union trustees. Thus they are not really "union" plans, but "union-employer" plans. The union and management trustees are unpaid, except expenses.

This structure gives our union a voice in our benefits. Union health plans can't be changed at the whim of management. The corporation's bottom line doesn't rule. It can be checked by the union.

Like union contracts, union health plans are good for workers.

That's why all Teamster leaders support the concept, from Hoffa to Teamster reform leaders.

Betraying Members Trust

Again and again, Hoffa and Hall have betrayed members' trust.

• They held contract rallies against healthcare cuts and then agreed to allow UPS to cut members' benefits.

• They told members UPS was "getting out of the healthcare business" and negotiated a UPS Freight contract that keeps Teamsters in a substandard company health plan.

• They told members a No Vote on the contract wouldn't affect their benefits and exposed their own lie when they improved TeamCare benefits after the No Vote.

Lying to members hasn't just hurt Hoffa and Hall's reputation. It's undermined members' trust in their union.

Hoffa and Hall gave members a devil's choice on healthcare. No wonder so many Teamsters say they'd rather have a company plan than a union plan.

Benefit Cuts?

Members are also concerned that, down the road, Central States could cut benefits.

Of course, under a company plan, UPS can also cut benefits. UPS just slashed benefits for 15,000 supervisors, and they would surely do the same to Teamsters if they could.

The contract fight revealed that Hoffa and Hall can't be relied on to defend our benefits. If we want to protect our benefits, members have to be organized and vigilant.

Despite all the problems with the Hoffa-Hall administration, we are 100 percent Teamster. We are pro-union and pro-contract so management doesn't have all the control. We are pro-union health plan for the same reason.

We don't want a corporate CEO to control our health, impose extra costs on families or deny coverage to working spouses.

The issues for Teamsters are fighting benefit cuts, and adding a maintenance-of-benefits clause in the contract to prevent cuts in the future.

The problem is not the concept of a union health plan. The problem is the Hoffa-Hall leadership.

October 17, 2013: Hoffa drew headlines when he declared that Obamacare would make union plans "unsustainable." It's another way that bungling by the Hoffa-Hall administration has hurt Teamster healthcare.

When the Affordable Care Act (ACA) was in Congress, the IBT didn't make sure union plans were fully protected. Healthcare providers and other industries looked after their interests. The IBT and other unions failed to do the same.

Now the labor movement is putting pressure on Obama to make changes with regard to union health plans. As part of that effort, Hoffa signed a letter, along with two other union presidents, saying that union plans would be "unsustainable" under Obamacare.

This flamethrower of a comment has backfired.

Employers have thrown this phrase at Teamster negotiators, as the employers try to bust members' health care or take it over. And many members have become concerned over the viability of union health benefits. Who wants to be in an unsustainable plan?

Benefits under virtually every single Teamster health plan are superior to those offered in the ACA's exchanges. Those are designed to extend health coverage to those who don’t have it, not to replace benefits our union contracts guarantee.

Hoffa should be able to lobby for changes in the ACA without throwing Teamster contract negotiators under the bus and fueling employer attacks on members' health benefits.

October 16, 2013: Former Teamster Alex Adams is one of the hundreds of thousands of retirees whose benefits could be slashed if Congress passes legislation to restructure the laws governing multi-employer pension plans.

Alex Adams, 71, worked in the trucking industry for 36 years before retiring in 2003. Five years later, Adams was diagnosed with cancer in his larynx and tonsils. As a result, he now takes food through a feeding tube and has to deal with a number of ongoing medical costs.

Click here to read more.

Not if We Stop It!

UPDATED October 23, 2013: A Congressional hearing will be held to address pension issues Tuesday, October 29.

We expect a bill to hit Congress very soon which would allow "deeply troubled" pension funds—such as the Central States Fund—to slash the pension benefits of retirees and those soon to retire.

We're out to stop this train wreck for Teamsters and other workers who worked long and hard to earn their pensions. If they revoke the ERISA anti-cutback rule and could then cut some pensions, the door will be open to slash more pensions.

This nasty bill has the support of employers and the Central States Pension Fund. We expect CS Director Thomas Nyhan to testify for it at upcoming hearings in the House of Representatives. The hearings were postponed due to the government shutdown.

Opposed are some unions and workers' organizations, the Pension Rights Center, the AARP and TDU.

Join the growing movement to help save our pensions. Learn what you can do, read the AARP statement on the issue, and click here to get informed.

Read what Teamsters have to say in "We Earned Our Pensions."

Join retirees and active Teamsters who are working with the TDU Pension Action Network to protect our pensions.

Alex Adams, 71, worked in the trucking industry for 36 years before retiring in 2003. Five years later, Adams was diagnosed with cancer in his larynx and tonsils. As a result, he now takes food through a feeding tube and has to deal with a number of ongoing medical costs.

Fortunately, as a member of the Teamsters, he regularly paid in to the Central States Fund—a national pension fund jointly administered by the union and several different trucking and construction employers. Now he receives a monthly check of about $3,500 from that fund that covers his medical expenses and allows him and his wife, who live in the Cleveland suburb of Maple Heights, to maintain “the lifestyle that we created for ourselves.” 

That Teamsters pension was part of what drew him to a career in truck driving, Adams says, and motivated him to stay in the field in spite of the tough times that followed the industry’s deregulation in 1980. Working mostly out of Cleveland, he became what’s called a “casual” driver, taking short-term jobs for different employers whenever they became available.

“I wanted that pension. So I went from company to company, sometimes two companies in one day,” says Adams. Later, he found more stable employment and rose to become president of Local 407 in 2000.

In addition to that Central States Fund check, he receives about $1,000 in monthly Social Security benefits and another $800 a month from serving on the Maple Heights City Council, but he says he can’t imagine living without his pension check, since his and his wife’s most significant expenses—like car payments, life insurance and healthcare—all depend on that income stream.

But Adams and hundreds of thousands of retirees like him may have to make do with less. Congress is expected to take up legislation in the next month that would fundamentally reshape the laws governing multi-employer plans. A soon-to-be-introduced bill could allow the trustees of some financially troubled plans, like the Central States Fund, to slash benefits already promised to current retirees. It’s not yet clear how big those cuts would be.

Multi-employer plans in the spotlight

Like the multi-employer health plans that have become a flashpoint in Obamacare debates, multi-employer pensions offer workers “portability”—a construction worker, for instance, can work for a dozen different employers covered by the same union and continue paying into the same pension fund. Established in union contracts with employers, these plans cover roughly 10 million workers, mostly in construction, but also in manufacturing, retail, service and transportation. 

While the reform bill’s language has not yet been drafted, it is expected to closely mirror a February 2013 proposal, Solutions not Bailouts, from the National Coordinating Committee for Multi-Employer Plans (NCCMP), according to the group’s executive director Randy DeFrehn. The proposal calls for granting special authority to pension trustees—comprised of representatives from labor and management—to take “early corrective actions” to prevent the future insolvency of the plans. These actions could include cutting benefits to current retirees like Adams. 

A hearing on the topic by the pension subcommittee of the House Education on Workforce was scheduled for October 10, but has been delayed as a result of the shutdown and debt ceiling crises.

The NCCMP, made up of trade unions and employers that administer multi-employer health and pension plans, has poured hundreds of thousands into lobbying for the bill. Its efforts are lent clout by the fact that the group, at least nominally, represents both labor and management. DeFrehn boasts that his organization has lobbied Congress with representatives from the labor movement, including the Central States Fund and several building trades unions. And a number of different unions with multi-employer pension plans, including the Teamsters, International Association of Machinists and Aerospace Workers (IAM), the International Brotherhood of Electrical Workers (IBEW), Service Employees International Union (SEIU) and the United Food and Commercial Workers (UFCW), participated in the NCCMP commission that led to the Solutions not Bailouts recommendations.

Of these unions, only the IAM has publicly broken from the NCCMP’s anticipated proposal. Frank Larkin, IAM’s communications director, calls the proposed change “the most significant cutback in retiree protections in nearly 40 years.”

That’s not hyperbole. If adopted, the proposal would strike at the core of Employee Retirement Income Security Act of 1974, designed to keep private-sector employers from withholding promised benefits. Under this foundational pension law and its 1980 amendment, employers are sometimes allowed to renege on promises made to future recipients, but the benefits of current retirees have long been deemed sacrosanct—with very few exceptions. (One of those, in rare cases, is bankruptcy, the process by which Patriot Coal, a spin-off of Peabody Energy, recently shed obligations to United Mine Workers of America retirees.) Prevailing logic has held that since current retirees are old and out of the workforce, they’re unlikely to find another job. As Adams says, “I couldn’t even go to Walmart and be a greeter. No one would hire me at 71 with cancer.”

Larkin says he expects others in organized labor to start voicing opposition to the NCCMP plan soon. He tells In These Times that IAM has been meeting with organizations and unions to raise awareness. SEIU and UFCW did not respond to request for comment on this story. An IBEW spokesperson affirmed the union's support for multi-employer pension plans and told In These Times that its “participation in drafting the report was not extensive,” but noted that the proposed cuts would apply in “only the most dire of circumstances.”

Troubled times

The NCCMP paints its proposal to cut benefits to current retirees as a tough but necessary decision. The choice, it says, is between future insolvency or difficult sacrifices now.

Multi-employer plans are indeed facing financial problems. As a whole, these funds face a roughly $5 billion deficit, which is expected to balloon to $27 billion in 10 to 20 years, according to the Pension Benefit Guaranty Corporation (PBGC), the government-run agency that insures private pensions. 

Several structural factors are driving that deficit upwards. The national trend of de-unionization coupled with job losses from the recession have meant that fewer and fewer workers are paying into funds as more and more retirees are starting to receive benefits. Employers also have an incentive to drop out of these pools when they can afford to do so—paying an exit fee has often proven more enticing than staying on the hook for owed benefits. Furthermore, like other pensions across the country, multi-employer plans were ravaged by the Wall Street-driven economic meltdown of 2008. While about 75 percent of multi-employer plans were considered financially healthy at the beginning of 2008, according to government criteria, only 30 percent were considered to be so by the start of 2009.

But many plans have since improved—60 percent are once again stable, and only about 25 percent, many of them relatively small funds, are in critical status. In fact, it’s two large pension funds in particular—the 410,000-participant Central States Fund and an 118,000-member United Mine Workers of America fund—that are responsible for much of the funding crisis. Together, they make up about 5 percent of all workers covered by multi-employer plans and about $26 billion of the $27 billion in liabilities of plans projected to go insolvent, according to the PBGC. 

The UMWA did not respond to requests for comment on the state of its funds, but the Teamsters point to a variety of structural factors outside of the union’s control. Leigh Strope, a spokesperson, says the poor financial condition of Central States can be traced back to the deregulation of the trucking industry, the recession of the early 2000s, and the most recent economic crisis.    

On the other hand, Teamsters for a Democratic Union (TDU), a group of rank-and-file members opposed to the Teamsters leadership, lays much of the blame on union leaders for failing to deal with those crises. It argues the union didn’t bargain enough new workers into the plan, noting that another large fund that has a broader base of contributors, the Western Conference of Teamsters plan, is doing just fine. The TDU also believes the union should never have let United Parcel Service (UPS) walk from the fund in 2007, which it says encouraged other companies to do the same and hiked up the ratio of retirees to actives to a dangerously high level. A high ratio puts stress on funds to produce returns in the stock market instead of relying on active contributions to pay benefits.

Thomas Nyhan, executive director of the Central States fund, says he opposed the decision to let UPS leave, since it cut off a key source of contributions to the fund. But, as a pension trustee, he had no say in what was ultimately an internal union matter. “This was not something we agreed to,” he says. “We didn’t have a choice.”

Central States did get an influx of cash from UPS for the deal, but the fund subsequently lost it in the 2008 meltdown. 

“While we gained a lot of assets, it made you more dependent on asset returns, because you won’t get any of the corresponding contributions from the actives anymore that had left the plan,” Nyhan says. “But you had a pile of money you had to invest to make up for that. The timing was so unfortunate.”  

Under the Solutions not Bailouts proposal, trustees could ostensibly only tamper with funds that, like Central States, are projected to be insolvent within either the next 15 or 20 years—and in the latter case, only if the ratio of inactive to active participants exceeds 2 to 1. Once trustees have exhausted “all reasonable measures to improve the plan’s funded position,” then they’d be allowed to start hacking away. 

The NCCMP’s goal, it says, is to avoid a more dire alternative: one of these multi-employer pensions going insolvent. Should this happen, retirees will get little protection from the federal government. Unlike the Federal Deposit Insurance Corporation (FDIC), which insures Americans’ bank accounts up to $250,000, the PBGC is not ultimately backed by the “full faith and credit of the United States government.” The PBGC can cover a small portion of the benefits that retirees are owed—but nowhere close to all of the fund’s obligations. On top of that, the PBGC itself is running low on cash, projected to become insolvent in ten years. 

In other words, if a fund runs out of money, current retirees will bear the brunt of the consequences.

With these devastating financial projections and an additional set of rules governing multi-employer pensions set to sunset at the end of 2014, the NCCMP sees a golden opportunity to enact sweeping reforms. Its most recent annual conference, held at the swanky Westin Diplomat Resort and Spa in Hollywood, Florida, was entitled “Now Or Never.”

 “We really are at a kind of crossroads, something has to happen now or it will be too late,” says DeFrehn, the organization’s president, who began his career managing health and pension funds for the UMWA. “If [the pension trustees] could take a 5 percent haircut across the board and still preserve the plans for the long run, doesn’t it make sense to intervene earlier?”

Another way?

Critics charge this is a false dilemma.

“Well gosh, if you’re gonna run out of money and you’re a pension plan, instead of just spending your money and then running out one day, why not cut all the pensions in half now and the money will last a lot longer?” says Ken Paff, TDU’s national organizer. “If you have three children and you can only feed two, why not just kill one of them now rather than let three of them slowly starve to death? There’s sort of a criminal logic to that, too.”

Paff says there are plenty of reasonable alternatives, like increasing the miniscule premiums that multi-employer funds currently pay to the PBGC or making the federal government responsible for at least some of the PBGC’s obligations. The AARP endorses those proposals and also suggests that the PBGC encourage some plans to merge in order to shore up risk.

The Pension Rights Center, a retiree advocacy group, encourages alternative fixes, like those outlined by AARP. 

“In a lot of these cases, the union plans are not representing the wishes of the retirees,” says Nancy Hwa, the Center’s communications director. “It’s the plans and management who are on the same side. And then you’ve got the rank-and-file people, particularly the retirees, who don’t really have a voice.”

The Central State Fund’s Thomas Nyhan says he originally supported federal funding assistance to the PBGC like the AARP is calling for, but was discouraged when congressional lobbying efforts in 2010 led nowhere. 

In fact, the main lobbyist for the NCCMP’s proposal is a former legislator who spearheaded that 2010 effort: Earl Pomeroy, who served as North Dakota’s lone House representative for almost two decades before he was knocked out by a Tea Party challenger in 2010. Pomeroy took a lot of heat that year for legislation that he introduced with Sen. Bob Casey (D-Pa.) to create a fund within the PBGC that would be fully backed by the federal government—something akin to FDIC insurance for multi-employer plans. The proposal got a lot of pushback from an upsurgent Tea Party angry about the federal government’s “bailout” of General Motors. The National Review blasted Pomeroy’s proposal and Rush Limbaugh foamed at the mouth about “the Porkulus bill” aimed at saving greedy Teamsters retirees. The plan eventually went nowhere.

After leaving the House for a high-paying gig at the lobbying firm Alston & Bird—announced two days after he left Congress—Pomeroy joined up with the NCCMP in support of a radically different approach to solve the nation’s multi-employer pension woes: the Solutions not Bailouts plan. 

Thomas Nyhan of the Central State Fund, too, says he’s been backed into a corner by political realities, and supports the NCCMP proposal out of his fiduciary duty to keep the plan solvent. 

“How do you provide any measure of retirement security under these circumstances when you don’t have Congress willing to do anything for you, when you don’t have the administration willing to do anything for you?” Nyhan asks.  

“Unless there’s a sea change in the political will in Washington, I don’t think [getting government assistance to the PBGC] is realistic,” he says. “It’s the judgment of my board that we should find a path, provide some measure of retirement security for our members out there, albeit at a lower level, rather than simply having them believe that their pension is going to continue in perpetuity—only to have the rug pulled out from underneath them completely.”

A dangerous precedent

A particular concern of the IAM and other critics of the NCCMP’s proposal is that granting trustees more authority to cut benefits will be a slippery slope. Multi-employer plans are one of the main sources of defined benefit pensions for American workers—plans in which benefits are based on a pre-determined formula. Defined benefit plans are increasingly rare as more and more businesses shift their employees to defined contribution plans or 401ks, transferring more of the investment risk to workers.

Public-sector pensions have been the target of cuts from budget-strapped state governments, as Wall Street-inspired “reformers” plot to hand over states’ retirement assets to hedge funds. Now, multi-employer pensions, too, are on the brink of their own major “reforms”—which, in the technocratic language of austerity, means cuts.  

“If this legislation included proposals to allow cuts to retiree benefits it would set a very bad precedent for all pension plans, large and small, public and private sector, troubled and well-funded, single-employer as well as multi-employer,” says Larkin.

“It will not be long before major corporations come along and say, well Congress allowed this in multi-employer plans, they should allow it in our plans as well,” warns Karen Ferguson, director of the Pension Rights Center. 

On an even more basic level, TDU’s Ken Paff takes issue with the very title of the NCCMP plan, Solutions not Bailouts, and the unions who were complicit in its formulation. “Since when does the union movement adopt the corporate word that anything that benefits workers is a bailout—is a minimum wage a bailout now for poor people?” Paff says. “Is my Social Security check that I cash each month a bailout for me? We bailed out everybody else but we’re not gonna give so much as a free Oreo cookie to these retired people.”

“It seems that some of the unions are just giving up—they look at this Congress and say, well, they won’t pass anything to help workers, they only pass things to hurt workers. Well, it’s undoubtedly true this year,” Paff continues. “But should you just give up? I don’t see conservatives and anti-union people giving up. Do they really think that President Obama is going to sign a law abrogating Obamacare? I don’t think so. They don’t think that. They think beating the hell out of it over the long term draws support to their side. Some of them might be right. Maybe we should try it.”

Jim Carothers, 69, a retired car-hauler from Redford, Mich. who currently gets benefits from the Central States Fund, is more blunt about the stakes.

“I think it would mean the complete death of the labor movement of this country. I don’t know how you would organize people and promise them anything if we get a contract,” Carothers says. “The question becomes, well, why would I join the union then if you can’t deliver what you’re promising? And that for the labor movement strikes me as an incredibly dangerous proposition.”

Today, U.S Senator Bob Casey (D-PA) announced his support for the Coalfield Accountability and Retired Employee Act of 2013 which would protect pension for retired coal miners. Currently some retirees are facing uncertainty because the United Mine Workers of America’s (UMWA) 1974 pension plan is severely underfunded and on the road to insolvency because of the 2008 financial crisis and reduced contributions to the plan. The 1974 plan covers more than 100,000 mineworkers. If the plan becomes insolvent, retirees could see dramatic reductions in their monthly pension checks. The legislation is intended to protect the promised pension and health care benefits of retired coal workers.

“Pennsylvania’s coal mining history stretches back to our state’s earliest days. Countless workers and families took on incredible risk to work in our mines and we have an abiding obligation to ensure their retirements are protected,” Senator Casey said. “This legislation is a commonsense approach that will create certainty for retired coal miners and their families.”

Currently, there are 12,202 UMWA members receiving healthcare and pension benefits in PA.  Additionally, some non-dues paying members receive benefits from the multi-employer plan which are not counted, but are estimated to raise the number of Pennsylvanians directly helped by this bill to over 13,000. The UMWA provides 217.5 million dollars annually to the PA economy, mostly in the western part of the state.

Coalfield Accountability and Retired Employee Act

Specifically, the bill would:

• Amend the Surface Mining Control and Reclamation Act to transfer funds in excess of the amounts needed to meet existing obligations under the Abandoned Mine Land fund to the UMWA 1974 Pension Plan to prevent its insolvency

• Make retirees who lose health care benefits following the bankruptcy or insolvency of his or her employer eligible for the 1992 Benefit Plan, which was established under the Coal Act of 1992 to provide health benefits to retired or disabled miners and their families. Companies that originally promised these benefits would be held accountable for the costs and, if needed, additional funding from the Abandoned Mine Land fund would be available.

• Provide that employer contributions under the UMWA Retiree Bonus Trust are not unfairly penalized by the tax code and receive the same tax-exempt treatment as contributions to other pension plans, allowing the full value of employer cash contributions to go to the retirees who earned them. This Retiree Bonus Trust provides modest supplemental pension payments to retired miners.