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For those of you that have not heard of the “Grow Act” (which is an Act to force pensions into becoming composite plans), please review the article posted on the 492 website which explains the problems with this Act. The article can also be found below in this email. In short, Western Conference’s actuaries found that workers in a previously healthy plan that converted to a composite plan would face massive benefit cuts under historical market conditions.
There will be a Zoom call that is open to all who participate in the Western Conference Pension Fund to learn more about this issue. We highly encourage you to call your Members of Congress NOW and tell them to oppose GROW in the next COVID relief bill. If you have already called, thank you, but call again. Call (202) 224-3121 to be connected with your Representative. To learn who represents you, use Congress's Find My Representative tool (https://www.house.gov/representatives/find-your-representative).
New Study Exposes Glaring Weaknesses of the GROW Act - Composite Plan Legislation Jeopardizes Retirement Security
A new actuarial study commissioned by the largest multiemployer plan in the country, the Western Conference of Teamsters Pension Plan, found that the “GROW Act” would harm workers, retirees, and the Pension Benefit Guaranty Corporation (PBGC). Download the press release and study below.
Press Release: New Study Exposes Glaring Weaknesses of the GROW Act
Actuarial Study: Composite Plan Legislation Jeopardizes Retirement Security
The GROW Act allows multiemployer plan trustees to “refinance” their obligations to workers and retirees in an existing plan over 25 years instead of 15 years, so they can divert money to start a new composite plan. This weakens the existing plan and leaves neither plan—the existing plan, nor the composite plan—with enough money to pay promised benefits.
The Western Conference’s actuaries found that workers in a previously healthy plan that converted to a composite plan would face massive benefit cuts under historical market conditions. For example, if Congress had already passed composite legislation and it was law now with investment returns similar to those in early 2020, the future composite plan benefits that workers expected they would earn would be cut 70%, and the composite plan benefits they already earned would be cut 25%. At the same time, workers’ benefits in the existing plan would be cut 21%. To avoid benefit cuts, employers would be required to increase contributions by approximately 82%—above and beyond what they already committed. Under the same scenario, a plan that didn’t transition to the composite structure would weather the market downturn without cutting benefits or increasing contributions.
In addition, composite legislation risks deepening the current PBGC solvency crisis or creating a new one by artificially reducing the cost of withdrawing from existing plans over time, placing existing plan funding in jeopardy, and exempting composite plans from paying PBGC premiums.
“Composite legislation and its resulting benefit cuts would violate a fundamental promise between workers and employers by denying workers and retirees the benefits they bargained for and earned,” according to Chuck Mack, the union co-chair of the Plan. “Composite legislation not only undermines healthy plans’ success but destabilizes the entire multiemployer system,” said Ed Lenhart, the employer co-chair.
Please contact your elected officials ASAP and tell them to vote NO on the GROW Act and have it removed from the HEROES Act!
- Locate your U.S. senators' contact information.
- Find your U.S. representative's website and contact information.
The Western Conference of Teamsters Pension Plan is the country’s largest and most successful multiemployer pension plan. For over 60 years, the Plan has provided substantial, secure retirement benefits to over half a million retirees. The Plan has over 600,000 participants and retirees, with participants or retirees in all 50 states and every congressional district. Currently, over 1,400 employers contribute to the Plan. These employers represent more than 50 diverse industries—including grocery and food distribution, package delivery, manufacturing, clerical, beverage bottling, law enforcement, entertainment, waste disposal, and health care. The Plan has $45 billion in assets and has always been well funded.
Download: WCTPT_Actuarial_Study_July_2020.pdf , WCTPT_PR_New_Study_Exposes_Glaring_Weaknesses_of_the_GROW_Act_7-21-20.pdf
TEAMSTERS UNION LAUDS CARES ACT RELIEF FOR YRCW WORKERS
Loan Will Protect Livelihoods of 30,000 Workers Impacted by Pandemic
A $700 million loan provided by the United States Treasury under the CARES Act will help YRC Worldwide, Inc.'s operating companies pay its employees' health care and other benefits and get through this pandemic while protecting the livelihoods of about 24,000 Teamsters and their families, Teamsters General President James P. Hoffa said today.
"I want to thank Congress for passing the CARES Act, and the President and the Treasury Secretary for their help in making this essential bridge loan possible," Hoffa said. "They recognized the urgency and acted swiftly to avoid our members' health benefits from being cut and, in the long term, to protect
24,000 Teamster jobs at YRC Freight, Holland, Reddaway and New Penn."
The CARES Act assistance will be used to pay for employee health care and pension costs and other obligations. YRCW employs 30,000 freight workers, including 24,000 Teamsters. "I echo General President Hoffa in thanking the government for providing this loan and protecting our members' livelihoods" said Ernie Soehl, Teamsters National Freight Director. "Like so many Teamsters who are essential workers, our members working at the YRCW operating companies have continued to keep our nation's supply chain moving to serve millions of Americans,” Soehl added. “They are true heroes. This assistance gives them some peace of mind moving forward and we hope it gives YRCW the economic stability it needs in the months and years to come."