Multiemployer (union) plans, for a variety of reasons*, will all go bankrupt. So what happens to promised benefits? The Road Carriers Local 707 Pension Fund (RC707) ** could tell us.
Archive for the ‘Multiemployer Pensions’ Category
According to an online report:
A pension fund serving Teamsters members said Thursday it will not issue a new plan to rescue the fund, following the Treasury Department’s rejection of proposed reductions. Thomas Nyhan, executive director of the Central States Pension Fund, said it remains in “critical and declining status” and called for legislation to protect participants’ retirement benefits. Earlier this month, Nyhan predicted insolvency for the fund without legislation, absent another plan.
A condition of that plan for Thomas C. Nyhan may be to keep the highest amount of payouts in place – and not only for retirees.
All for ourselves, and nothing for other people, seems, in every age of the world, to have been the vile maxim of the masters of mankind.
– Adam Smith, The Wealth of Nations
The 5500 filing for 2014 for the Central States Pension Fund (CSPF) is 428 pages with 160 of those pages (12-171) being the Schedule C, a form where you report expenses being paid out of the trust which mostly go to Service Providers but for CSPF there are also several Trustees and Employees listed.
Were the Pension Benefit Guaranty Corporation (PBGC) to take over CSPF and cut benefits to the maximum allowed not only would participants take a substantial hit but these ‘Trustees’ and ‘Employees’ would be off the trust payroll entirely.
So it is that when the Treasury denied the CSPF rescue plan with its massive benefit reductions (encouraging larger reductions) the people who run the fund, on their website, fought back: