More gloom and doom..CS is tanking

[The Milkman]

Only those who foolishly decided to sell during the downturn lost their shirts. My 401k has more than rebounded from 2008.

Retired that year and was lucky to sell my home in Jersey in a timely fashion and get one in AZ before the crap really hit the fan. With that said I did not panic, I took monthly withdrawls since then and I did recoup most of it to this day. We all took a big hit in a short amount of time, but by riding it out as you said, your acct would recover in due time. Mind you, when I retired in 08 I was done making donations to it and it was there for me to enjoy and spend in my retirement. And still doing it to this day..I can't take it with me........

 

[OLDMAN3]

We (working UPS Teamsters) are not out of the water yet...

One scenario which could be devastating for UPS teamster employees who have part of their pension credit under Central States (hired before 2008)...

We were told this by our Teamster officials...
Once a plan to rescue Central States is presented we will vote on it. If the pension reductions end up being insufficient to keep the fund from going belly up, and the fund runs out of money and is no more...UPS is released from their obligation because the fund (Central States) will no longer exist.

So the worst rescue plan for current UPS union employees would be one that continues the status quo and allows Central States to go under in approximately 10 years.

The best rescue plan for current UPS union employees would be severe cuts in pension benefits (that UPS would have to cover for its retirees under the IBT/UPS plan) which may enable the plan to go on for decades.

 

[MC4YOU2]

We (working UPS Teamsters) are not out of the water yet...

One scenario which could be devastating for UPS teamster employees who have part of their pension credit under Central States (hired before 2008)...

We were told this by our Teamster officials...
Once a plan to rescue Central States is presented we will vote on it. If the pension reductions end up being insufficient to keep the fund from going belly up, and the fund runs out of money and is no more...UPS is released from their obligation because the fund (Central States) will no longer exist.

So the worst rescue plan for current UPS union employees would be one that continues the status quo and allows Central States to go under in approximately 10 years.

The best rescue plan for current UPS union employees would be severe cuts in pension benefits (that UPS would have to cover for its retirees under the IBT/UPS plan) which may enable the plan to go on for decades.

Is there a point at which the underfunded percentage could become an issue with regulators, and run the risk of shutting the plan down? If not, it would seem that UPS would essentially have to maintain the payments and make the cuts a non issue.

 

[OLDMAN3]

Is there a point at which the underfunded percentage could become an issue with regulators, and run the risk of shutting the plan down? If not, it would seem that UPS would essentially have to maintain the payments and make the cuts a non issue.

I am just repeating what I was told. At this point it seems quite clear that the Pension Benefit Guaranty Corporation will be going belly up as well as Central States so there will be no rescue from the regulators. It is just a matter of how long the rescue plan can delay the eventual demise of Central States. I would advocate for the most severe cuts to pension benefits out of self interest. But just today I saw a retired driver I knew many years. He started at UPS in 1967 and retired before 2008. I can't imagine what cutting his benefit in half would do to him and his wife.

Also I believe when UPS bought out of the pension they paid 6 billion or so and also committed to a specific amount (1 1/2 Billion?) for future underfunded payments if Central States cut the payments. I don't think there has been a definitive answer on what happens if and when that (1 1/2 Billion?) threshold is reached. It would seem likely that the additional (1 1/2 Billion?) will be depleted quickly.

At that point is UPS off the hook?

 

[UpstateNYUPSer(Ret)]

The PBGC is broke but will never go belly up.

Trying to convince UPSers to support severe pension cuts will be much easier than trying convince others in the fund to do the same.

 

[O/C]

The PBGC is broke but will never go belly up.

Trying to convince UPSers to support severe pension cuts will be much easier than trying convince others in the fund to do the same.

The PBGC is a federal agency, it will not be terminated, every private and federal pension plan pays a premium to cover their demise. More than likely the feds will just make the trustee's pay higher premiums to make up the underfunding. As far as UPS not covering their union retirees, currently there is language to prevent that from happening, in the future is anybody's guess? Said it before but with UPS the money has and will be there, it would be pathetic if the union or the feds let them continue to mess with their union retirees. Trust me on this one 2016 will be a defining year for everybody concerned with our health and welfare and pension benefits.

Sent using BrownCafe App

 

[UPSmechanicinblue]

I am just repeating what I was told. At this point it seems quite clear that the Pension Benefit Guaranty Corporation will be going belly up as well as Central States so there will be no rescue from the regulators. It is just a matter of how long the rescue plan can delay the eventual demise of Central States. I would advocate for the most severe cuts to pension benefits out of self interest. But just today I saw a retired driver I knew many years. He started at UPS in 1967 and retired before 2008. I can't imagine what cutting his benefit in half would do to him and his wife.

Also I believe when UPS bought out of the pension they paid 6 billion or so and also committed to a specific amount (1 1/2 Billion?) for future underfunded payments if Central States cut the payments. I don't think there has been a definitive answer on what happens if and when that (1 1/2 Billion?) threshold is reached. It would seem likely that the additional (1 1/2 Billion?) will be depleted quickly.

At that point is UPS off the hook?

I don't think the 6 billion payed means anything for UPS retirees. Any company that withdraws from Central States is slapped with a withdraw liability. Even ones that decertify from the union or members switch to a company based 401K or pension. This is a federal law that they have to pay a withdraw liability that goes into the fund and is used for anyone drawing from the fund.

 

[Brownslave688]

I don't think the 6 billion payed means anything for UPS retirees. Any company that withdraws from Central States is slapped with a withdraw liability. Even ones that decertify from the union or members switch to a company based 401K or pension. This is a federal law that they have to pay a withdraw liability that goes into the fund and is used for anyone drawing from the fund.

If the company is bankrupt I don't think they'll be paying anything.

 

[UPSmechanicinblue]

If the company is bankrupt I don't think they'll be paying anything.

correct, if they can't they wont- members still can draw from the fund

 

[Mugarolla]

We (working UPS Teamsters) are not out of the water yet...

One scenario which could be devastating for UPS teamster employees who have part of their pension credit under Central States (hired before 2008)...

We were told this by our Teamster officials...
Once a plan to rescue Central States is presented we will vote on it. If the pension reductions end up being insufficient to keep the fund from going belly up, and the fund runs out of money and is no more...UPS is released from their obligation because the fund (Central States) will no longer exist.

So the worst rescue plan for current UPS union employees would be one that continues the status quo and allows Central States to go under in approximately 10 years.

The best rescue plan for current UPS union employees would be severe cuts in pension benefits (that UPS would have to cover for its retirees under the IBT/UPS plan) which may enable the plan to go on for decades.

The vote means nothing. Even if a cut is turned down by the retirees, the pension trustees can still make the cuts.

A vote is pretty much meaningless.

They will cut benefits as far as they need to in order to keep the plan solvent.

They may make further cuts down the road if need be. They will not let the plan go bankrupt.

The first ones to be cut are "orphans." Retirees drawing benefits whose employer went out of business.

That is over half the retirees drawing from CS. If that does not shore it up, next will be retirees from companies like YRC.

They are still in CS yet are barely even contributing to the fund right now.

Next will be retirees from current companies who are contributing their fair share to the fund.

Last, and if need be, will be UPS retirees. Most pension experts believe it will not come to this. Even if it does, UPS has to make up any cuts.

Some say this is not fair. Well, these orphan companies did not even come close to fulfilling their pension obligation. Some only made it to 50 or 60%

UPS paid 100% of theirs, so is is fair for UPS retirees to take a cut when their employer met 100% of their pension liability compared to another employer that only made 50% of theirs?

This was the benefit of a multi-employer pension. If one went out of business, there were enough others paying into the fund to sustain it.

This all changed with deregulation. Again, over half of the retirees drawing a pension from CS had their employer go out of business.

This was the start of the downfall of the CS multi-employer pension fund.

It could never be sustained with only half the employers contributing to it yet their employees still drawing from the pension fund.

 

[UpstateNYUPSer(Ret)]

If the company is bankrupt I don't think they'll be paying anything.

The pension fund would be among the list of creditors looking to get pennies on the dollar.

 

[rod]

I got a letter today from Ms. Susan M.-- Retiree Rep. Anyone else get it? Basically its just another "what is coming" letter I suppose just to soften us up more to the inevitable.

 

[IVE GOTTA PACKAGE 4U]

Our pension fun got Zero when Hostess went bankrupt. Owing 25/million to our fund.

 

[Mugarolla]

Our pension fun got Zero when Hostess went bankrupt. Owing 25/million to our fund.

And their retirees are about to feel the pain. Another orphan company.

 

[IVE GOTTA PACKAGE 4U]

And their retirees are about to feel the pain. Another orphan company.

So are the rest of us, in our underfunded pension plan.

 

[Mugarolla]

So are the rest of us, in our underfunded pension plan.

UPS retirees will see little, if any cuts. UPS got the earmark from Congress. Last in line to be cut.

 

[IVE GOTTA PACKAGE 4U]

UPS retirees will see little, if any cuts. UPS got the earmark from Congress. Last in line to be cut.

I'm not in CS. I'm in a different multi employer underfunded pension.

 

[upschuck]

I'm not in CS. I'm in a different multi employer underfunded pension.

You shouldn't of voted it in then.

 

[OLDMAN3]

The vote means nothing. Even if a cut is turned down by the retirees, the pension trustees can still make the cuts.

A vote is pretty much meaningless.

They will cut benefits as far as they need to in order to keep the plan solvent.

They may make further cuts down the road if need be. They will not let the plan go bankrupt.

That is my understanding as well...
We will vote on it, but if is voted down, cuts will be made anyway.

However, I was given the distinct impression , if not the outright statement by a Teamster official that the plan will eventually go bankrupt and the PBGC will not rescue the plan because it is too big to rescue. This rescue plan would extend the plan, delaying it's demise.

If it is your impression that "They" will not let it go bankrupt who might "They" be?
-The PBGC?
-The administrators of CS?
-The federal government/Congress?

Of course the administrator of CS would like to extend it's life as long as possible...half million dollar+ salaries are hard to come by.

Plus everyone gets:
Great Benefits (fully paid health, vision, dental insurance, 10 vacation and 12 sick days, 401k with match, company paid pension, tuition reimbursement, a stipend for lunch)
- Great work hours (35 per week) and flex scheduling (start between 6 and 930 am and work 7 hour days)

 

[IVE GOTTA PACKAGE 4U]

You shouldn't of voted it in then.

Don't even get me started