2017 Changes to Non-Union Retirement Effective 2023

[Scuba_Steve]

Anyone remember the changes that were made in 2017 to the non-union/management retirement?

The 401k changes promised were:

Continued 50% of up to 3% match (same as today)
+ PLUS either 5%(0-4 years), 6%(5-9), 7%(10-14), or 8%(15+ years) direct annual contribution to your 401k
+ PLUS EXTRA 5% annual additional contribution thru 2027, and 7% each year after if you were eligible for the final average compensation retirement benefit previously

So if you were previously eligible for the final average compensation retirement benefit with 15+ years, you would start receiving an additional 13% + 1.5%(match) into your 401k from UPS until 2027, and then starting in 2028 would be additional 15%+1.5%.

Funny how its almost mid year and nothing has been said about that when it supposedly goes into effect next year.

 

[DaveA]

I still have the brochure they sent to my house. I have that scanned in. There shouldn't be any changes to it. I'm sure they would have announced it by now. I think legally they have to offer certain things in order to freeze the pension for those already vested.

My match is 50% of 5% so basically 2.5% match. I'm 20 years in.

What's to say, really?

 

[DELACROIX]

I still have the brochure they sent to my house. I have that scanned in. There shouldn't be any changes to it. I'm sure they would have announced it by now. I think legally they have to offer certain things in order to freeze the pension for those already vested.

My match is 50% of 5% so basically 2.5% match. I'm 20 years in.

What's to say, really?

You guys should be expecting a buy out soon... The Company wants to trim their books before the PBGC raises their insurance rates and before the next Contract.

Your accrued pension benefits are protected by ERISA, those cannot be eliminated or changed.

 

[MrWonderful]

UPSERS.com used to have all of that info summarized for us. It’s not there anymore. Anyone knows what happened to it?

 

[VacationIsCancelled]

You guys should be expecting a buy out soon... The Company wants to trim their books before the PBGC raises their insurance rates and before the next Contract.

Your accrued pension benefits are protected by ERISA, those cannot be eliminated or changed.

I expect an offer too, maybe one that is "or else" like some of the previous offers. I and a couple of others in my group are top end of the years of service list, and the contributions to 401K after 2022 add up to a fairly nice chunk of money. I can't believe they want to have us on the pension payroll AND drop those lump sums in after 2022.

 

[Karma...]

anticipate unannounced buyout offers to selected people across many departments.....this will occur before the next contract...all this makes sense to reduce payroll thus costs......union folks can always be laid off depending on volume....however, all people who are not moving parcels are deemed overhead and should be looking for another job... carol has been doing an outstanding job in doing her main priority which is stock/dividend price....thats management.....her predecessors were stuck in the past and could not " adjust to changing conditions"......carol is looking ahead to the post covid economy and setting the plans.....maybe there will be a spot for a new ie department ......a new vision is needed beyond "better not bigger "....I digress...

 

[ifreak]

You guys should be expecting a buy out soon... The Company wants to trim their books before the PBGC raises their insurance rates and before the next Contract.

Your accrued pension benefits are protected by ERISA, those cannot be eliminated or changed.

I was actually thinking that the company would likely offer a Pension buyout so they can get that liability off the books. The problem is that they have so many they would have to buy out. That would take a bunch of cash.

 

[Anonymous 115]

UPSERS.com used to have all of that info summarized for us. It’s not there anymore. Anyone knows what happened to it?

I came here to see if anyone knew the answer to this. I was planning on asking either HR (hahaha) or my management this week to see what they know. It's kind of strange that it has been there for the last few years and is suddenly gone.

 

[MrWonderful]

I came here to see if anyone knew the answer to this. I was planning on asking either HR (hahaha) or my management this week to see what they know. It's kind of strange that it has been there for the last few years and is suddenly gone.

. If you find out anything, please post the info here.

 

[VacationIsCancelled]

. If you find out anything, please post the info here.

It was in the Total Rewards portal last time I was in there.

 

[TearsInRain]

anticipate unannounced buyout offers to selected people across many departments.....this will occur before the next contract...all this makes sense to reduce payroll thus costs......union folks can always be laid off depending on volume....however, all people who are not moving parcels are deemed overhead and should be looking for another job... carol has been doing an outstanding job in doing her main priority which is stock/dividend price....thats management.....her predecessors were stuck in the past and could not " adjust to changing conditions"......carol is looking ahead to the post covid economy and setting the plans.....maybe there will be a spot for a new ie department ......a new vision is needed beyond "better not bigger "....I digress...

we will probably have the usual near-retirement buyouts and then immediately rehire them as "contractors" but we are pushing for a 7 day network and hiring thousands of feeder drivers, as well as re-planning a huge chunk of the network, so i wouldn't expect a huge drawdown of management below the DM level

DM's and above are free game since they legit dont do much already

 

[DaveA]

Submit a question in Workday. They always respond; just may not be a very good answer.

 

[Tanktoptony]

Been hearing about 7 day for a while any idea on timeframe

 

[DaveA]

I'd love to see a pension buyout - just for the extra money they are kicking in starting next year. Not sure I would give up the pension itself.

 

[Karma...]

how do I get back into ups ers .com ?......

 

[Anonymous 115]

. If you find out anything, please post the info here.

Reply from Workday:

With reference to your query, we have a UPS Retirement team that assists employees with their pension plan and retirement inquiries. So we would request you to contact the UPS retirement team at 1-800-643-4442 or write them at [email protected] for further assistance. Also, we would request you to contact the technical team at 1-888-877-8324 with regard to access to the retirement calculator.

I will try the email today.

 

[IVE GOTTA PACKAGE 4U]

how do I get back into ups ers .com ?......

Go reapply UPS and get hired....

 

[DELACROIX]

Go reapply UPS and get hired....

As Union Folk..

 

[DELACROIX]

Cezanne, I don't think I am near as informed as you with respect to laws governing pensions but I think there are a couple reasons UPS would want to eliminate the pension, 1) as someone stated earlier past performance is not a guarantee of future returns, there are all sorts of things that could occur that could negatively affect the pension plan for years to come not to mention the possibility of people consistently living into their 80's 90's or possibly later. This would have a drastic affect on the pension plan. 2) this is my worry and only mine as I have not heard it anywhere else but what happens if Teamster Pension plans (Central States for one) goes under? I am afraid before the government would step in they would look at UPS with an overfunded plan and ask UPS to transfer money. I am not sure this is legally an option but I don't see the government shelling out millions when UPS has money and has another pension plan that is 110% funded. Again this is just speculation on my part. 3) Like I believe someone stated earlier it has to be a huge savings to convert to a 401 match (additional 3% possibly) due to the fact many may not contribute the full 6% possible, also, this eliminates all of UPS liablity for future payouts which are subject to all sorts of risk (geopolitical, natural disasters, etc...) Just my thoughts, however, I think the possibility of a buyout are very slim, I think their will be changes but I don't think they will be better for us or offer any sort of immediate gain.

For money? I am just guessing, but in the 1980s a lot of pension plans were liquidated to raid their surplus, until tax laws changed to discourage raiding overfunded pension funds. "But thanks to an accounting rule that is little known...there is a way to gain from the pension surplus. The rule provides that if investment returns on pension assets exceed the pension plans' current costs, a company can report the excess as a credit on its income statement. Voila: higher earnings."

The advantage of an overfunded plan can become an even larger advantage if liabilities can be decreased - by reducing benefits. Companies have found ERISA-compliant methods of converting to cash-balance plans "...which can reduce benefits for older employees who otherwise would have seen their pension credits build up rapidly in their last working years", even though ERISA is intended to prevent this sort of benefit reduction.

There is a way for companies to liquidate a pension plan and avoid most of the taxes and keep most of the excess funds, but this is usually a last-ditch effort to keep a company alive...
Research Guides: Regulation of Financial Institutions: Get Started

Another scheme involves merging an overfunded plan with an underfunded plan, to eliminate the penalties that come with an underfunded plan.

Keeping an overfunded plan can make good business sense. Merging has become more common, as companies try to avoid make-up payments on an underfunded plan.

In the end, it will be a business decision - nothing personal.

These posts are dated from 2007..might give those concerned more information on why the Company is eliminating it’s management pension funding...

 

[DELACROIX]

"Rich plan, poor plan - 13 Jan 2006
Steven Brull
UPS's pension plan for nonunion employees outperforms its peers and runs a surplus, while many of the multiemployer plans for its unionized workers struggle. And Big Brown can't deliver a fix.

It's the best of times, it's the worst of times for pension holders of United Parcel Service of America.
In this tale of two pension plans, if the employees are among UPS's 125,000 nonunion workers, they're in fine shape. Big Brown's $10.5 billion in-house plan is one of the rare corporate schemes to be overfunded, boasting $110 in assets for every $100 in liabilities. Its portfolio returned 13.3 percent in 2004 -- the most recent year for which figures are available -- and an annualized 10.9 percent for the three years ended 2004. Those results handily best the 12.2 percent and 7 percent returns, respectively, for plans of the nation's 100 biggest corporations, according to Seattle-based Milliman Consultants."

SO WHY WOULD THEY KILL IT?​

Here’s another one dated May 9, 2007