What law change are you referring to? UPS agreed to cover any CSPF shortfall by negotiated contract, not law.
when to retire?
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trickpony1
Well-Known Member
If they want to assure a strike dropping that language would do it.
burrheadd
KING Of GIFS
burrheadd
KING Of GIFS
Indecisi0n
Well-Known Member
I called the contract writer and he says maybe.
Ms.PacMan
Well-Known Member
Actually, the Treasury Dept stipulated that UPS cover the CS pension payments of employees after 2008 should CS fail. It doesn't matter if it's in the contract or not. (IMO the Teamsters just put it in the contract to make it look like something they did for us).
This info was in the Treasury Dept's response letter to CS last year when they tried get the Treasury Dept to approve lower pension payments for those left in the fund and the reason the Treasury Dept denied Central States proposal, because it would place too much of a burden on UPS because they would have to cover the shortfall. I posted the letter on BC.
Ms.PacMan
Well-Known Member
You're safe- retire.
Actually in 2008, ERISA (not the Treasury Dept) prevented any reduction in benefits to those in pay status and restricted cuts to future beneficiaries and then only to severely troubled plans.
In 2014, the Treasury Dept was empowered to enact the terms of the Kline-Miller act (MPRA). Your chronology doesn't work. How could the Teamsters possibly know in 2008 terms of a bill passed in 2014 would give the Treasury Dept authority to rule on pension benefit cuts?
In 2008, the Teamsters UPS NMA negotiators were being vigilant in anticipating negative future Congressional acts.
There were several reasons given why the "Rescue Plan" was rejected but I've not seen any concern for the "burden on UPS" listed.
The Treasury Dept suggested cuts based on three levels, and UPS beneficiaries/participants were to get the least cuts. However the Treasury Dept suggested the plan failed to equitably spread cuts.
I've read the Treasury Dept rejection letter and many accompanying letters of theory exhaustively. You might enjoy reading the UPS lobbyists written section in the Kline-Miller Act,
26 U.S. Code § 432 (e) (9) (D) (vii) (lll) (bb) which requires (make whole) terms in a CBA to be in place for the third level of reductions to even be considered.
Looks like terms in a CBA are necessary after all.
Ms.PacMan
Well-Known Member
wtf are you talking about???
I was reinforcing what you said and you argue about it. But the promise to pay the difference doesn't need to be in the contract - UPS will cover the difference because that's the terms the Treasury Dept gave UPS when they allowed them to withdraw from CS in 2008.
I think he still enjoys his job. Scratch is not a miserable person.
Ms.PacMan
Well-Known Member
Actually in 2008, ERISA (not the Treasury Dept) prevented any reduction in benefits to those in pay status and restricted cuts to future beneficiaries and then only to severely troubled plans.
Which is why UPS bought us out of the plan - and that had to be approved by the Treasury Dept.
In 2014, the Treasury Dept was empowered to enact the terms of the Kline-Miller act (MPRA). Your chronology doesn't work. How could the Teamsters possibly know in 2008 terms of a bill passed in 2014 would give the Treasury Dept authority to rule on pension benefit cuts?
The Teamsters didn't initiate the buyout - UPS did. But the Teamsters did think that the buyout would shore up the fund.
In 2008, the Teamsters UPS NMA negotiators were being vigilant in anticipating negative future Congressional acts.
There were several reasons given why the "Rescue Plan" was rejected but I've not seen any concern for the "burden on UPS" listed.
The Treasury Dept suggested cuts based on three levels, and UPS beneficiaries/participants were to get the least cuts. However the Treasury Dept suggested the plan failed to equitably spread cuts.
Exactly - the cuts were most severe for current employees (my own estimated pension cut was 70%) and UPS would have to make up that difference. Whereas retirees (not made whole) would have the littlest cuts which would have placed an enormous burden on UPS.
I've read the Treasury Dept rejection letter and many accompanying letters of theory exhaustively. You might enjoy reading the UPS lobbyists written section in the Kline-Miller Act,
26 U.S. Code § 432 (e) (9) (D) (vii) (lll) (bb) which requires (make whole) terms in a CBA to be in place for the third level of reductions to even be considered.
Looks like terms in a CBA are necessary after all.
The Kline Miller act of 2014 has nothing to do with UPS buying out the pension in 2008 (as you said above) therefore that code in the act about requiring terms in a CBA doesn't apply and wasn't even in existence in 2008. There was no law or act in 2008 requiring the make whole agreement to be in a CBA.
The Treasury Dept required the make whole agreement when UPS exited the fund so that when CS failed the PBGC wouldn't be bankrupted.
And like I said before I think the only reason it's even in the contract is so the Teamsters can take some perverse credit for it.
Which is why UPS bought us out of the plan - and that had to be approved by the Treasury Dept.
In 2014, the Treasury Dept was empowered to enact the terms of the Kline-Miller act (MPRA). Your chronology doesn't work. How could the Teamsters possibly know in 2008 terms of a bill passed in 2014 would give the Treasury Dept authority to rule on pension benefit cuts?
The Teamsters didn't initiate the buyout - UPS did. But the Teamsters did think that the buyout would shore up the fund.
In 2008, the Teamsters UPS NMA negotiators were being vigilant in anticipating negative future Congressional acts.
There were several reasons given why the "Rescue Plan" was rejected but I've not seen any concern for the "burden on UPS" listed.
The Treasury Dept suggested cuts based on three levels, and UPS beneficiaries/participants were to get the least cuts. However the Treasury Dept suggested the plan failed to equitably spread cuts.
Exactly - the cuts were most severe for current employees (my own estimated pension cut was 70%) and UPS would have to make up that difference. Whereas retirees (not made whole) would have the littlest cuts which would have placed an enormous burden on UPS.
I've read the Treasury Dept rejection letter and many accompanying letters of theory exhaustively. You might enjoy reading the UPS lobbyists written section in the Kline-Miller Act,
26 U.S. Code § 432 (e) (9) (D) (vii) (lll) (bb) which requires (make whole) terms in a CBA to be in place for the third level of reductions to even be considered.
Looks like terms in a CBA are necessary after all.
The Kline Miller act of 2014 has nothing to do with UPS buying out the pension in 2008 (as you said above) therefore that code in the act about requiring terms in a CBA doesn't apply and wasn't even in existence in 2008. There was no law or act in 2008 requiring the make whole agreement to be in a CBA.
The Treasury Dept required the make whole agreement when UPS exited the fund so that when CS failed the PBGC wouldn't be bankrupted.
And like I said before I think the only reason it's even in the contract is so the Teamsters can take some perverse credit for it.
Can you PM me or post a link to this requirement?
dookie stain
Cornfed whiteboy
My 401k is bull...I've got about $1,700 in there...yay 
Ms.PacMan
Well-Known Member
Treasury rejects Central States benefit reductions
BY HAZEL BRADFORD | MAY 6, 2016 2:10 PM | UPDATED 3:26
The Treasury Department on Friday denied the benefit reduction application of the $17.8 billion Teamsters Central States, Southeast & Southwest Areas Pension Fund, Rosemont, Ill.
In a letter to the pension fund board of trustees, Treasury Special Master Kenneth Feinberg said the application was denied for failing to meet three criteria of the Kline-Miller Multiemployer Pension Reform Act of 2014, which created the benefit suspension process.
Central States' proposed benefit suspensions “are not reasonably estimated to allow the plan to avoid insolvency,” Mr. Feinberg said, because Treasury officials considered the plan's 7.5% rate of investment return and entry age assumptions to be unreasonable. “We found there were fatal flaws in this submission,” he said on a press call.
The plan also did not distribute benefit cuts equitably, and did not provide participants with easily understood notices, according to the letter.
The pension fund applied Sept. 25 for permission to reduce benefits in order to avoid insolvency that it projected would happen by 2026. At the time of its application, it was 53% funded, with $35 billion in liabilities.
The Congressional Research Service estimated that total benefits would be reduced by $11 billion under the proposed plan.
Central States Executive Director Thomas Nyhan said in a statement that the decision was disappointing, “as we believe the rescue plan provided the only realistic solution to avoiding insolvency.” The fund is projected to run out of money within 10 years “or even less,” he said. With the Pension Benefit Guaranty Corp.'s insurance program also facing insolvency, “Central States participants could see their pension benefits reduced to virtually nothing,” said Mr. Nyhan, who called on Congress to pass legislation protecting those benefits.
If Treasury had approved the application, an estimated two-thirds of the plan's 400,000 participants would have seen their benefits reduced, with nearly 40% seeing cuts of 30% or higher, while older and disabled participants would not see cuts.
The pension fund created three tiers of participants with different levels of benefit reductions. Tier I participants, whose employers left the plan, would have had the biggest cuts. Their benefits would be reduced to 110% of the PBGC guarantee, which is less than $13,000 for a participant with 30 years of service.
Tier III participants are current and former employees of United Parcel Service Inc., Atlanta, which paid $6.1 billion to withdraw from the pension fund in 2007 and set up a single plan jointly trusteed with the International Brotherhood of Teamsters. As part of a collective bargaining agreement at the time, UPS also agreed to a “make-whole” provision in the event that the pension fund reduced benefits in the future. An approved plan would have triggered that backstop, and cost the company between $3.2 billion and $3.8 billion in additional benefit payments, when recognized as an interim mark-to-market charges.
Tier II participants include all others, including some UPS workers who retired before the 2007 agreement.
UPS spokesman Steve Gaut said the company “regrets” the pension fund's economic challenges and uncertain future and encourages it to file a revised application “that follows the law and the binding legal commitments to UPS by the fund.”
PIOnline : Subscription Center
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I can't find the Treasury Dept's full ruling on the recovery plan but I believe they used the word 'required' when they talked about UPS making up the pension difference.
And read the last sentence in the above article....binding legal commitments to UPS by the fund.
The make whole agreement may be a backstop written in the CBA but IMO it's just a formality.
And if the make whole provision were only a contractual issue, why didn't the CS Teamsters and UPS just wait until 2018 and remove it from the new contract and then submit the recovery plan?
trickpony1
Well-Known Member
I'm trying to understand this better.....I really am.
2018 hasn't got here yet.
What's to keep one or both parties from washing their hands of this issue? I'm told there is language in the current contract about UPS making up any shortage but what's to keep either party from defaulting Sept 1, 2018?
Ms.PacMan
Well-Known Member
Trying to understand this is what I've been doing, too, for the last 10yrs. If you read my old posts I didn't trust the promise at all - like you and other posters.
For me it's been a sum of all the things I've read (which is everything I can find). I know my tone in posts sounds angry but it's the subject not the discussion that irritates me. I'm mad that they leave us in the dark and that UPS and the Teamsters, who have zero integrity and lie to us every chance they get, expect us to make a retirement decision based on their word.
I was always looking for outside sources to verify the make whole promise. It's hard for me to go back and find everything I've read in the last 10yrs but here is an excerpt from a congressional hearing.
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Unlike similarly situated single-employer plans, multiemployer plans that become insolvent receive assistance from the PBGC in the form of loans. There are strong incentives for adequate funding of multiemployer plans and for plans to avoid PBGC assistance. In addition to employers being jointly liable for unfunded benefits, the guaranteed benefit for participants is small. Currently, the maximum PBGC guaranteed benefit is approximately $13,000 for 30 years of service, compared with about $54,000 for workers who retire at age 65 in single-employer plans. In effect, workers in multiemployer plans bear more of the risk of plan underfunding than workers in single-employer plans.
Multiemployer plans pose a smaller risk to the PBGC than single-employer plans because the PBGC insurance program for multiemployer plans is the second "backstop."
Contributing employers are the first insurers of benefits. Instead of a plan terminating and being trusteed by the PBGC as under the single-employer program, PBGC multiemployer plan insurance is triggered by plan insolvency. When a multiemployer plan lacks assets to pay basic guaranteed benefits, PBGC provides financial assistance in the form of loans, but the plan, rather than PBGC, continues to pay guaranteed benefits.
https://www.dol.gov/agencies/ebsa/a...r/speeches-and-testimony/testimony-05-27-2010
Ms.PacMan
Well-Known Member
This was never about loving employees or union members - just money. UPS figured buying their way out of CS in 2007 was cheaper than making up the underfunded liabilities when CS went completely under. But the buyout had to be approved and under ERISA laws at the time, the earned pension amounts had to be guaranteed so I'm sure the PBGC, DOL, or Treasury Dept made the make whole agreement a stipulation in the pension buyout.
The changes to ERISA under the Kline Miller act now allow for previously earned pension benefits to be reduced IF a plans proposal is approved by the Treasury Dept and voting members.
Central States tried this and it wasn't approved. The eye opener for me was that CS felt confident that UPS would be held liable for the difference no matter what - Why? If it were only a contractual guarantee they could have waited until 2018 and removed the promise from the contract and then submitted the recovery plan. Obviously (to me anyway) it's not just a contractual liability but a legal liability.
@UpstateNYUPSer @IVE GOTTA PACKAGE 4U
I think members of other underfunded pension plans whose employers are still solvent should fight tooth and nail against any plan restructuring under the Kline Miller act and leave the employers (UPS) on the hook to make up the difference of the underfunded liabilities. The Teamsters are going to promote these recovery plans because they benefit them and orphan members of the funds but for ups employees they are bad and unnecessary.
The changes to ERISA under the Kline Miller act now allow for previously earned pension benefits to be reduced IF a plans proposal is approved by the Treasury Dept and voting members.
Central States tried this and it wasn't approved. The eye opener for me was that CS felt confident that UPS would be held liable for the difference no matter what - Why? If it were only a contractual guarantee they could have waited until 2018 and removed the promise from the contract and then submitted the recovery plan. Obviously (to me anyway) it's not just a contractual liability but a legal liability.
@UpstateNYUPSer @IVE GOTTA PACKAGE 4U
I think members of other underfunded pension plans whose employers are still solvent should fight tooth and nail against any plan restructuring under the Kline Miller act and leave the employers (UPS) on the hook to make up the difference of the underfunded liabilities. The Teamsters are going to promote these recovery plans because they benefit them and orphan members of the funds but for ups employees they are bad and unnecessary.
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I don't know what the solution is. It makes me sick thinking about the pension.
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