UPS Teamsters keeping their next two Wage increases

[Inthegame]

I still don't understand why these companies would have "continuing pension liabilities", providing they made all payments to the pension fund while in business?

Let's say Big Jim's Trucking was in business for 50 years and was participating in a collective bargaining agreement, made all required payments to the pension fund until they closed the doors, why would they still be liable?
How is it that Big Jim's Trucking didn't meet their obligation?

Because Big Jim's Trucking didn't make all their pension obligation payments if they quit contributing and went out of business. They also didn't pay their withdrawal liability.

One can't assume all of Big Jim's employees are retired when Big Jim quit business. If any of Big Jim's employees are not retired at closing time, the withdrawal liability kicks in but Big Jim is fly fishing in Canada and not making his required contributions and sticking it to the remaining participating employers. Exactly what Hostess did.

 

[Bubblehead]

Because Big Jim's Trucking didn't make all their pension obligation payments if they quit contributing and went out of business. They also didn't pay their withdrawal liability.

One can't assume all of Big Jim's employees are retired when Big Jim quit business. If any of Big Jim's employees are not retired at closing time, the withdrawal liability kicks in but Big Jim is fly fishing in Canada and not making his required contributions and sticking it to the remaining participating employers. Exactly what Hostess did.

Where is this liability if this company made all required contributions while in business?

Why would they be obligated to keep paying when they are no longer in business?

Wouldn't any employees that "aren't retired yet", simply be vested at a lesser amount?

 

[Inthegame]

Where is this liability if this company made all required contributions while in business?

When the employer signs the multi employer pension trust participation agreement they are in fact agreeing to not go out of business. They're also agreeing to make all obligated payments to provide the covered employees with the promised benefits which includes their portion of the unfunded liability (the difference between the funded status and 100%) if they quit business.

When a multi employer pension plan announces it's funded status, it is assuming the employers benefit obligation remains intact indefinitely. If those obligated payments aren't made, the unfunded liability increases for all remaining participants. So Big Jim's liability is his plus any other deadbeat prior participant, even if Jim skipped a couple of fishing trips to keep the doors open and made all his required contributions while in business.

 

[Bubblehead]

When the employer signs the multi employer pension trust participation agreement they are in fact agreeing to not go out of business. They're also agreeing to make all obligated payments to provide the covered employees with the promised benefits which includes their portion of the unfunded liability (the difference between the funded status and 100%) if they quit business.

When a multi employer pension plan announces it's funded status, it is assuming the employers benefit obligation remains intact indefinitely. If those obligated payments aren't made, the unfunded liability increases for all remaining participants. So Big Jim's liability is his plus any other deadbeat prior participant, even if Jim skipped a couple of fishing trips to keep the doors open and made all his required contributions while in business.

Perhaps this is the inherent flaw in multi-employer pension funds?
How can it be expected that a company "not go out of business", or be immuned from bankruptcy?
Why wouldn't these employers be required to make all contributions as they go along, instead of down the road?
Could it be this why many people see these pensions plans as elaborate, somehow legal, ponzi schemes.

 

[upschuck]

Because Big Jim's Trucking didn't make all their pension obligation payments if they quit contributing and went out of business. They also didn't pay their withdrawal liability.

The withdrawal liability should just be a bonus to the plan, and not a need for the plan to survive.

One can't assume all of Big Jim's employees are retired when Big Jim quit business. If any of Big Jim's employees are not retired at closing time, the withdrawal liability kicks in but Big Jim is fly fishing in Canada and not making his required contributions and sticking it to the remaining participating employers. Exactly what Hostess did.

The liability is for what? to pay those not retired their full retirement payments? They should get the benefits that were paid into for each employee. The employee with 10 years in, should not get anything but 10 year pension benefit, otherwise, you get a mess like we have now.

 

[Ghost in the Darkness]

All that I am concerned with in the present moment is trying to figure out how to not let the Trustee's take our next two raises. Its not going to help the issue.

The problem here is that Teamsters negotiated away these raises to the company. Its their of slowing our pay rate by trying to make it look like something for our pension. Notice how the OT part of diverted raises just evaporated, they essentially just avoided giving us raises for those periods. All this was a slight of hand, a misdirection... a trick. They had to sell it to get a yes vote on that contract.
Good luck on your quest but the reason why we won't get it back or even get a chance to make a case is because the Union knows they negotiated it away. They screwed us over, that ship has sailed.

 

[Inthegame]

Perhaps this is the inherent flaw in multi-employer pension funds?

It's more of a hook that deters companies from opting out at contract renewal time. Remember these employers signed the participation agreement willingly.

How can it be expected that a company "not go out of business", or be immune from bankruptcy?

Show me a company that starts business expecting to go out of business. The bankruptcy immunity protection companies are allowed is one of the prime causes of pension collapse. Once again Hostess is a perfect example.

Why wouldn't these employers be required to make all contributions as they go along, instead of down the road?

Because their contribution rates are predetermined by the CBA. The market has a large impact. If their plan has a poor investment year, the participating employers don't kick in more annually to make up the underperformance, instead the unfunded liability increases. If the plan trustees vote a pension increase, the unfunded liability increases. If new mortality tables are used and we all live longer...you guessed it, unfunded liability increases.
In an ideal world the funded % stays at 100% and unfunded/withdrawal liability is negligible. We don't live in an ideal world (financially).

Could it be this why many people see these pensions plans as elaborate, somehow legal, ponzi schemes.

Not that sure about "many" people. I'm in a 75 yr old plan that's doing just fine. Know of any Ponzi schemes that last that long? Of course not because Ponzi schemes are just that... schemes with no possible way of survival. Properly run pensions last indefinitely.
BTW, over 75% of the 1400+ multi employer plans were green zone last year, a poor performance year.
100% of ponzi schemes were red.

 

[By The Book]

The liability is for what? to pay those not retired their full retirement payments? They should get the benefits that were paid into for each employee. The employee with 10 years in, should not get anything but 10 year pension benefit, otherwise, you get a mess like we have now.

I'm picking up what your putting down, but I have a question. If I start at UPS at the age of 20 and work 30 years an retire does that mean my pension payments stop when I turn 80? I'm using the rule of 80 here.

 

[ezmoney5150]

I'm picking up what your putting down, but I have a question. If I start at UPS at the age of 20 and work 30 years an retire does that mean my pension payments stop when I turn 80? I'm using the rule of 80 here.

Understanding the Rule of 65 or 70/80 retirement - Pellet Hourly
To be eligible for Rule of 65 or 70/80 retirement, your plan required that your age plus your service equal 65, 70 or 80 and that your continuous service is broken (in other words, your employment with National Steel ended) due to one of the following reasons:

1. A permanent shutdown of the mine, the plant, your department or a subdivision of your department,
2. By being on layoff for more than 2 years, or
3. Due to physical disability.

On the date the plan ended (12/6/2002 ), National Steel had not permanently shut down, so if you were an active employee on that date you did not meet the plan's requirement for Rule of 65 or 70/80 retirement.



On the date the plan ended, no participant who met the age and service requirement for Rule of 65 or 70/80 had been on layoff for more than 2 years continuously.



Any participant whose service terminated due to physical disability before the date the plan ended retired under the plan's permanent incapacity provision, which provides the same benefit as a Rule of 65 and 70/80 retirement.

 

[Evil]

$33.22/hr to deliver a package is nothing to sneeze at.

We are not losing 20%'and future raises. It is one or the other, not both.

We're at $35.63 an hour in the Southern California. You guys being $3.41 lower is not fair and very bad.

The pensions here in the West is 91.7% funded.

 

[3 done 3 to go]

We're at $35.63 an hour in the Southern California. You guys being $3.41 lower is not fair and very bad.

The pensions here in the West is 91.7% funded.

$33.22/hr to deliver a package is nothing to sneeze at.

We are not losing 20%'and future raises. It is one or the other, not both.

Hopefully us that have already had the pension deferment. That obviously didn't work. Will receive a wage adjustment to catch up to the others. 3.41 more would be nice

 

[UpstateNYUPSer(Ret)]

Hopefully us that have already had the pension deferment. That obviously didn't work. Will receive a wage adjustment to catch up to the others. 3.41 more would be nice

You appear to be unable to grasp the wage diversion concept.

We received all of our contractual raises.

We decided to hand some of those raises over to the Union.

There is no going back.

 

[3 done 3 to go]

You appear to be unable to grasp the wage diversion concept.

We received all of our contractual raises.

We decided to hand some of those raises over to the Union.

There is no going back.

Yes. Forgot about that fact. Just another reason to vote no. Again and again. Just wish my vote counted

 

[Coldworld]

We're at $35.63 an hour in the Southern California. You guys being $3.41 lower is not fair and very bad.

The pensions here in the West is 91.7% funded.

It's important to say that the wctpt is funded so well because it is very diverse in regards to the different types of businesses and such that pAy into it....ups is actually a very small part of the plan...there are both public and private entities that are paying into the fund