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.

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."

TEAMSTERS JOIN IN CELEBRATING JUNETEENTH

Union Calls on Congress to Create Federal Holiday

The Teamsters join in honoring the 155th anniversary of the first Juneteenth and call on Congress to create a federal holiday marking the end of slavery. The Teamsters Human Rights & Diversity Commission will be celebrating along with Teamsters from across the country. Juneteenth, a portmanteau of June and nineteenth, is also called Freedom Day, Emancipation Day or Jubilee Day.

Juneteenth acknowledges June 19, 1865, when Major General Gordon Granger, along with more than 1,800 federal troops arrived in Galveston, Texas, to take control of the state and ensure freedom for the last remaining enslaved African Americans in the area.

This year, there is a renewed sense of purpose surrounding Juneteenth, given the continuing injustice black Americans face in this country. The murder of George Floyd in Minneapolis on May 26 at the hands of police may have been the catalyst event that has brought hundreds of thousands into the streets to protest against racial discrimination all across this country, but the litany of wounds can be traced back 400 years.

“For more than a century, the Teamsters have stood for racial equality. But that in itself is not enough,” Teamsters General President Jim Hoffa said. “This union recognizes that we all must do more to ensure that black Americans live their lives without fear of injustice and have an equal voice in our communities. A Juneteenth holiday is a small, but important, step towards recognizing the full independence of every American.”

Juneteenth initially became an occasion for gathering lost family members and measuring progress against freedom. In many territories, freed Black people would dress in their finest clothes to hear speeches. The earliest celebrations sparked traditions that continue today – from readings of the Emancipation Proclamation and religious services, to cookouts and family sporting events.

“This country continues to battle with the demons of its original sin, slavery,” said Marcus King, Director of the Teamsters Human Rights and Diversity Commission. “Creating a Juneteenth holiday will not solve the nation’s ills, but it will continue America’s evolution towards truly bringing liberty and justice for all.”

President Lincoln signed the Emancipation Proclamation on January 1, 1863, which declared “that all persons held as slaves” within the rebellious states “are, and henceforward shall be free.” However, after more than two years, there were still thousands of enslaved black people unaware of their freedom, located in a handful of confederate territories where word spread slowly or was outright resisted. Some slave owners coordinated with Union troops to wait until the end of a harvest to inform enslaved black people they had been freed. Others resisted until federal troops arrived to read Lincoln’s proclamation to the enslaved.

Although Juneteenth has been informally celebrated primarily by African American communities since that day in 1865, currently 46 of 50 U.S. states and the District of Columbia recognize Juneteenth as an official state holiday or observance. Texas became the first in 1980. New York and Virginia have also announced efforts to recognize Juneteenth as a state holiday there as well. Many corporations such as Twitter and Nike have declared Juneteenth a company holiday in recent weeks in response to protests over the killing of George Floyd and as corporate America faces backlash over racial inequality.

It is very important to commemorate Juneteenth this year. It has only been 155 years since the end of slavery and African Americans in this country still face discrimination and brutalization through an evolved machine that inflicted those same atrocities over the last 401 years.

The Human Rights & Diversity Commission is using Juneteenth 2020 as day of reflection, action and service. We implore you to join us in doing the same.

Please share your story. Take a picture with your Teamster logo and send it to the IBT Instagram or Facebook pages celebrating Juneteenth.