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Fred Zuckerman
57 mins · Beaverlick, KY
Avral and I attended the Central States Pension fund meeting yesterday in Chicago. C/S notified us they sent their proposed plan to reduce pensions to the Treasury Dept last Friday. Treasury has up to 225 days to approve the plan and send it out for a vote or reject the plan. Letters were mailed out to all participants on Thursday and should tell you how you will be affected by the proposed changes. Although it becomes complicated with the many different considerations I will briefly outline the changes.
There are 3 tiers.
Tier 1 participants are orphans. There are 43,400 total participants in this group. 28,400 would receive reductions and 15,000 would not receive reductions. If you retired with an employer that no longer makes contributions you would be in this tier. These participants would be cut to 110% of the PBGC rate.
Tier 2 is participants who are working or retired with an employer who continues to make contributions. There are 315,600 participants in this group. 197,300 would receive reductions and 118,300 would not receive reductions. I believe this group will suffer a 16% to 18% reduction. Some of the calculations include reducing pre 2004 accruals to 1%.
Tier 3 participants are the UPS Transfer Group. There are 48,000 in this group. There are 46,900 who would receive reductions and 1,100 who would not receive reductions.
They did change the reemployment rules for anyone who retires before October 1, 2015 they are not prohibited. After October 1, 2015 there are rules for participants 62 - 64 years old and over 65 years old. This is only changed if the plan is approved.
Future accruals after July 1, 2016 would be earned at .75% instead of 1%.
This is only a brief outline of the changes. Central States will be mailing information and have a video/town hall meeting on October 15.
I know this post will be controversial, however I believe its best to be absolutely transparent and inform the membership of the good and bad as quickly as possible.
Fred Zuckerman
57 mins · Beaverlick, KY
Avral and I attended the Central States Pension fund meeting yesterday in Chicago. C/S notified us they sent their proposed plan to reduce pensions to the Treasury Dept last Friday. Treasury has up to 225 days to approve the plan and send it out for a vote or reject the plan. Letters were mailed out to all participants on Thursday and should tell you how you will be affected by the proposed changes. Although it becomes complicated with the many different considerations I will briefly outline the changes.
There are 3 tiers.
Tier 1 participants are orphans. There are 43,400 total participants in this group. 28,400 would receive reductions and 15,000 would not receive reductions. If you retired with an employer that no longer makes contributions you would be in this tier. These participants would be cut to 110% of the PBGC rate.
Tier 2 is participants who are working or retired with an employer who continues to make contributions. There are 315,600 participants in this group. 197,300 would receive reductions and 118,300 would not receive reductions. I believe this group will suffer a 16% to 18% reduction. Some of the calculations include reducing pre 2004 accruals to 1%.
Tier 3 participants are the UPS Transfer Group. There are 48,000 in this group. There are 46,900 who would receive reductions and 1,100 who would not receive reductions.
They did change the reemployment rules for anyone who retires before October 1, 2015 they are not prohibited. After October 1, 2015 there are rules for participants 62 - 64 years old and over 65 years old. This is only changed if the plan is approved.
Future accruals after July 1, 2016 would be earned at .75% instead of 1%.
This is only a brief outline of the changes. Central States will be mailing information and have a video/town hall meeting on October 15.
I know this post will be controversial, however I believe its best to be absolutely transparent and inform the membership of the good and bad as quickly as possible.
