Wash. Times: Unions agree to cut pension benefitsOn Dec 30, 2014 All Categories | Latest updates | Union Mismanagement
When it comes to standing by the obligation unions made to provide pensions to retirees, UFCW pleaded poverty in persuading Congress to let chronically underfunded union pension plans cut the benefits of workers, including those already retired.
“Declining participation and factors like the Great Recession have created a new reality for Taft-Hartley multiemployer plans wherein many of them are substantially underfunded,” departing UFCW President Joseph T. Hansen wrote to the House Education and the Workforce Committee in a letter this month.
“The simple fact is that in order to save some of the most vulnerable pension plans trustees must be given the ability to slightly reduce benefits. This is the only realistic way to avoid insolvency and preserve as much of the promised pension benefits as possible,” the union boss wrote in a letter urging lawmakers to allow underfunded union pension plans to cut promised benefits.
Numerous other unions, many of them big spenders on the political front, also lobbied for the concession.
Congress obliged in a last-minute deal approved by lawmakers as they fled town for Christmas break. On Dec. 15, President Obama signed the Multiemployer Pension Reform Act of 2014 into law, empowering any multiemployer pension fund — commonly managed by unions — to cut benefits for workers and current retirees if the plan is 20 percent or more underfunded.
In another words, Congress and the president let workers who spent decades toiling away to vest in retirement programs take the hit for union managers who failed to keep pensions fully funded.
In all, more than 10 million U.S. workers rely on multiemployer pension plans. About 1 million of those could get notices next year informing them that the pension benefits they were promised when they signed on to their jobs may be cut. Only those older than 75 get any relief.