UPS, Teamsters to Restructure New England Pension Plan

Discussion in 'UPS Union Issues' started by Sammy, Aug 25, 2012.

  1. Sammy

    Sammy New Member

    What do members think of the new proposal that has been released:

    UPS (NYSE: UPS) today announced an agreement with the New England Teamsters and Trucking Industry Pension Fund (NETTI) to restructure pension liabilities for approximately 10,200 UPS employees.

    The agreement reflects a decision by NETTI's trustees to establish a second pension plan "pool" to make it more attractive for new employers to join the Fund. Such a structure is designed to allow employers to assume responsibility only for their own employees without regard to any previous Fund liabilities. For UPS, this structure allows the company to freeze its liability in the original pool, establish its payment obligations and move UPS employees into the new pool.

    UPS will record a one-time charge of $896 million in the third quarter. This charge represents the present value of the company's $2.1 billion withdrawal liability from the original pool, which it will pay over the next 50 years. Subject to approval by local unions, the withdrawal will be effective Sept. 16, 2012.
     
  2. happybob

    happybob Feeders

    Didn't the company agree not to try and leave other pension funds when they left the central states fund?
     
  3. Sammy

    Sammy New Member

    This is from the January 2012 NETTIP Annual funding notice:
    The total number of participants in the plan as of the Pension Fund's valuation date was 74,512. Of this number, 22,581 were active participants, 31,594 were retired or separated from service and receiving benefits, and 20,337 were retired or separated from service and entitled to future benefits.

    Only 10,200 UPS employees are part of the New England Teamsters and Trucking Industry Pension Fund ?
    I can see why UPS wants out of this Multiemployer Pension Fund.
    UPS will record a one-time charge of $896 million in the third quarter

    It looks like UPS will be able to legally freeze its liability in the original pool, for the amount of 87,843 dollars per employee. $896,000,000 / 10,200 employees = $87,843
    How long will it take for the 74,512 plan participants to make this old pool of pension assets insolvent.




     
  4. bobups3

    bobups3 New Member

    So if I belonged to the New England pension plan my first 25 years would be paid under the old plan and anything after 25 by the new ups plan. so when the old pool runs out of money I'm out of luck. Hope they do not try that here.
     
  5. Sammy

    Sammy New Member

    That is exactly how I understand this new plan. It seems if you were to retire today with 30 years of service you would be in good shape for the next 10 to 20 years. I have 20 years to go before I retire. I am not very confident that my first 20 years of pension will be there when I retire. It almost feels like I am just starting to build my pension from day one on September 16,2012.
     
  6. grgrcr88

    grgrcr88 No It's not green grocer!

    Better get some language protecting your future when the old plan becomes insolvent.
     
  7. TheKid

    TheKid Well-Known Member

    The old plan is protected , they are paying of what they owe. Like my BA said , stop trying to look for the 'bad side'
     
  8. Monkey Butt

    Monkey Butt You can call me Chappy Staff Member

    Excuse me ... this is Brown Cafe where the perennial whiners and naysayers who are always very negative come to wallow in their misery!!!!

    They only see the "bad side".

    This is like asking a scorpion not to sting ... it's the only thing they know.
     
  9. TheKid

    TheKid Well-Known Member

    Sorry , my bad.
     
  10. Sammy

    Sammy New Member

    The old plan is protected how. The reason UPS is leaving the old plan is because it is in critical condition. September 30, 2011 the old plan was 49% funded. There are almost 50,000 people in the NETTIP fund that are drawing pension benefits or owed pension benefits. Only 26,000 are actively contributing to the old plan. UPS has figured out what they owe to this old plan which is stated in the press release($896,000,000).
    You have to look at the bad side to prepare for the future. I think I may have to increase my 401k savings to respond to the possibility that the old pool may become insolvent in 20 years. The reason this is happening is because the multiemployer pension plan does not work. There are to many members drawing on the assets and not enough putting in to the fund.
     
  11. NHDRVR

    NHDRVR New Member

    Although the specifics haven't been presented yet, meeting Saturday at the union hall, the general sentiment was very positive. I see this as a way to better ensure that the pension, a pension, any pension, has a better chance to be there than it did last week.

    A rumor in our center, 0302, was that this is going to be set up to 'help' older drivers make a quicker decision to leave. I guess it depends on what the parameters are but I would assume UPS would want less drivers with 7 weeks vacation and old legs...we are the majority, which, in UPS, is a problem...
     
  12. over9five

    over9five Moderator Staff Member

    There is a Special meeting Saturday at the Union hall to "explain the necessary changes to Article 69 of the New England Supplement in order to enable UPS to transition to the new liability pool created by the New England Teamsters and Trucking Industry Pension Fund".

    It goes on:

    "The vote to accept the changes in Article 69 will dramatically and significantly improve the financial integrity of the Fund and guarantee UPS' continued support and participation in the Fund"


    ​Guess we know how they want us to vote....
     
  13. NHDRVR

    NHDRVR New Member

    In NH, the bottom driver in the state has 4 years seniority, we have a large number of drivers around/near 25 years. The common thread has been ' the retirements should start pretty soon'...I assume the same everywhere else but the problem is that too many are holding on for the next contract and we always thought something wwould have to happen to cycle in newer drivers. I guess this is the start of that...
     
  14. NHDRVR

    NHDRVR New Member

    Lol, the way the article on Yahoo Finance read was that the union already accepted the 896 million....sounds
    like the vote was yes...wish I was there
     
  15. TheKid

    TheKid Well-Known Member

    The old plan is protected by all the money they are paying into it , $2.1 billion.
     
  16. brownmonster

    brownmonster Man of Great Wisdom

    I find it hard to believe no full time driver has been hired in NH in 4 years.
     
  17. NHDRVR

    NHDRVR New Member

    It's absolutely true.
     
  18. menotyou

    menotyou bella amicizia

    In the next three years, my center will be hiring 7.



    No, Dave. That doesn't include my position. :funny:
     
  19. Sleeve_meet_Heart

    Sleeve_meet_Heart making the unreadable unreadabler

    No one else seemed to understand this, thank you for pointing this out. I made mention of it in the main thread in UPS discussions.
    All I hear in the hub is "rah rah rah" because no one takes the time to think for themselves, they just eat up whatever the union sells them.
     
  20. Sleeve_meet_Heart

    Sleeve_meet_Heart making the unreadable unreadabler

    It is true.
    When I was going from 22.3 to FT driver, we made an appearance in the Nashua building. The drivers were absolutely angry and upset that we were "new guys" hired off the street, in their eyes. The HR person actually made mention of this and said "let's not linger around, it is a sore spot because they are not hiring drivers".
    This was in Aug 2009 but I am guessing has continued. All four of us were FT from another hub and, at the time, another district.