November 3, 2008: The market turmoil of recent weeks has been brutal to 401(k)s. But beyond highlighting the woeful inadequacy of many Americans' retirement savings, the meltdown puts a spotlight on some longstanding pitfalls of 401(k)s themselves -- and makes it even more urgent that investors guard against them.

This year through Oct. 30, the average 401(k) account balance dropped roughly 18% to 23%, depending on the participant's age and tenure with the plan, according to Employee Benefit Research Institute.

Click here to read more at the Wall Street Journal.

October 10, 2008: New retiree healthcare cuts in Virginia Joint Council 83 will make it harder for members to take early retirement.

Starting Jan. 1, 2009, new retirees with less than 30 years of accrued service will only receive a maximum of eight years of retiree healthcare coverage.

Retirees already pay for their coverage in Virginia—but after eight years they’ll be totally cut off from retiree healthcare coverage, no matter how much they’re willing to pay.

That means people taking 25-and-Out will have to wait until they’re at least 57 to retire if they want to keep healthcare coverage until they’re eligible for Medicare.

Members with more than 30 years of accrued service will be unaffected.

Members can go on and off the Joint Council 83 healthcare plan and break up the eight years of coverage. But if they are not covered by another plan during the time they are off the Joint Council plan, they lose their right to return to the Teamster plan.

Plus, there’s no change in the Joint Council 83 re-employment rules, to give retirees more options to get healthcare coverage.

Click here to download the letter from the fund detailing the cut.

TDU and our union fought in the 1990s to win 25-and-Out early retirement benefits. Now many health and welfare plans are making it harder to take advantage of this good Teamster benefit.

What do you think our union should to protect early retirement? Click here to send a comment or a question to TDU’s Pension Network.

Stay in the loop. Click here to get email updates from TDU’s Pension Network.

October 1, 2008: Ending a strike that began Aug. 26, members of International Brotherhood of Teamsters Local 200 at Waste Management Inc. in the Milwaukee area Sept. 28 voted to ratify a new five-year labor agreement that will change the current defined pension program and replace it with a 401(k) defined contribution plan, according to the company and the union.

The union's move to ratify the agreement comes after members twice rejected the same proposal, first on Sept. 19 and later on Sept. 21, with union officials citing member's concerns about the turbulent economy as the reason for the switch.

Workers will return to work Oct. 1, Waste Management spokeswoman Lynn Morgan told BNA Sept. 29. About 240 truck drivers, equipment operators and mechanics are represented by the union, according to the company and the union.

"Today, our members voted for the latest offer from Waste Management by a 2-1 margin and officially ended their strike," Local 200 Secretary and Treasurer Tom Millonzi said in a statement Sept. 28. "Our members who were forced to strike for more than a month in a fight to secure a strong contract, made a difficult decision with this vote. With this vote, our members decided that given the turbulent nature of our economy, their families' futures must take priority over holding out for a better offer from Waste Management."

Millonzi could not be reached for further comment Sept. 29 and Sept. 30.

Pension Issue Key Sticking Point

The new agreement, which took effect upon ratification, changes the current defined benefit pension program and replaces it with a 401(k) defined contribution plan--a key point of contention in previous negotiations.

"It was the key issue and the sticking point," Morgan told BNA Sept. 29.

Under the new agreement, "Waste Management is going to be allowed to withdraw from Central States [Southeast and Southwest Areas Health and Welfare and Pension Funds] on a going forward process," Morgan said. "What that means is the company will not be required to make future contributions. It will not continue to purchase more pension benefits for employees already in the fund. It will establish 401(k) plans."

Current employees will receive whatever they have vested in Central States, she added. Changes to salary, health plan and tool and uniform allowances also were made to the previous contract, which expired on April 30, Morgan said, but she declined to give more specific details of the new contract.

The company already had started to hire permanent replacements for the strikers on Sept. 21, even though the Teamsters had offered to meet with the company at any time to resolve the contract, Millonzi told BNA Sept. 25.

However, Morgan told BNA the next day, "As long as the union is insisting Waste Management put its employees' and customers' future at the mercy of the Central State's Pension Fund, there's not much to talk about."

Teamsters Local 200 represents about 240 truck drivers, equipment operators and mechanics employed at Waste Management's Milwaukee-area operations.

The company provides waste collection and recycling services in the Milwaukee area for an estimated 102,500 homes and 16,300 businesses and institutions and provides disposal services for waste that municipal crews and other companies collect from homes and facilities, according to the company.

September 29, 2008: Striking Teamsters voted Sunday to accept a new labor agreement and return to work as soon as Wednesday.

Members of Local 200 approved the new deal by a more than 2-to-1 ratio. In a statement from the Teamsters leadership, the union conceded that striking workers "made a difficult decision with this vote."

Click here to read more at the Milwaukee Journal Sentinel.

September 26, 2008: As Congress makes plans to bail out the financial crisis on Wall Street, our union is asking for help for our pension funds.

Read the article in the Wall Street Journal.

September 22, 2008: For the second time in three days, members of striking Teamsters Local 200 rejected a contract offer from Waste Management.

Sunday’s vote was 199-24. On Friday, union members voted unanimously to reject the five-year contract offer.

As a result, Waste Management said it would withdraw an offer it said included higher wages and benefits, as well as a plan to move Teamsters from the Central States Pension Fund to a new 401(k) plan.

“The contract on the table was fair to everyone,” said Lynn Morgan, speaking for Waste Management. “The employees would have taken home market-leading pay and benefits and gained better protection from the Teamsters’ failing pension fund.”

Morgan said the offer will be modified to provide “scaled back wage increases and health benefits.”

The company, whose drivers pick up trash and refuse in a six-county region, also will begin the process of hiring permanent replacement workers, which Morgan said Waste Management had the legal right to do.

Click here to read more at the Milwaukee Journal Sentinel.

September 19, 2008: Striking Milwaukee Teamsters today unanimously rejected Waste Management’s proposal to replace their pension plan with a 401(k).

The proposal was Waste Management’s “last, best, and final” offer. The company has threatened to take the offer the table by Sunday if members rejected it.

Over 200 members of Local 200 are in their fourth week of a strike at the garbage giant.

The major sticking point has been WM’s proposal to bust out of the Teamster Central States Pension Plan in favor of an inferior 401(k) plan.

Members have been solid on the picket line. Management has brought in their “Green Team” of scabs—but they haven’t been able to handle all the trash piling up.

Management has issued publicity about the UPS pullout from Central States, which was agreed to by the International Union. They’ve also refused to bargain fairly; unfair labor practice charges have been filed.

The pension issue has broader implications, because WM is the largest waste haul corporation and has 13 contracts in other areas in the Central States Fund.

All Teamsters should support the strikers, including using an extension of picket lines if it becomes necessary against this corporate giant.

September 19, 2008: As we go to press in mid-September, over 200 Teamsters in Milwaukee are in their fourth week of a strike at Waste Management. A major issue is WM’s move to bust out of the Teamster Central States Pension Plan and replace it with a 401(k) plan which would be far inferior.

The Teamsters have been solid on the picket line, and management’s scab labor force has not been able to handle all the trash piling up.

Management has issued publicity about the UPS pullout from Central States, which was agreed to by the International Union. They’ve also refused to bargain fairly; unfair labor practice charges have been filed.

The pension issue has broader implications, because WM is the largest waste haul corporation and has 13 contracts in other areas in the Central States Fund.

All Teamsters should support the strikers, including using an extension of picket lines if it becomes necessary against this corporate giant.

September 19, 2008: When Consolidated Freightways closed its doors in 2002, the company owed over $400 million in withdrawal liability to Teamster pension funds. CF’s nonunion parent company Conway never paid a dime of that money.

Now Conway has filed a federal lawsuit against the Central States Pension Fund demanding a judgment that it does not owe Central States—or any Teamster fund—any withdrawal liability.

They claim that since Conway spun off CF long before CF went bankrupt, they have no liability. The Central States Fund says that Conway owes $319 million.

Conway brought in $4.39 billion in revenues in 2007.

September 19, 2008: The new UPS Pension Fund covering 44,000 Teamsters in the Central States not only offers the lowest benefits; it also has no reciprocal agreements with Teamster pension plans around the country.

That means that UPSers in the Midwest, Southeast and Southwest who have substantial years worked under other pension plans will face stiff pension reductions when they retire.

Most (though not all) Teamster pension funds have reciprocal agreements. For example: a Teamster who worked 15 years for UPS in California and then 15 years at UPS or another Teamster employer in Ohio can retire with a 30 and out pension. That’s because the Western Conference Pension Fund and Central States Pension Fund have a reciprocal agreement.

But the new UPS Pension Plan has no such agreements. That may not be a problem right now because no one has substantial time in the new UPS Pension Fund yet. But going forward, Teamsters who accumulate less than a full pension in the UPS Plan will suffer big pension reductions even if they have 25, 30 or even 35 years of time served in the Teamsters.

Didn’t our negotiators see this coming? It’s a problem that needs to be fixed before working Teamsters suffer irreparable pension losses.