Act Poses Major Threat to Multiemployer Pension Plans, Including the Western Conference of Teamsters Pension Trust

Multiemployer pension plans are no strangers to political threat – especially those plans that are in poor financial health, which are frequent targets from anti-union politicians. However, the threat posed by currently proposed legislation would not only damage plans facing financial challenge, but would do even more devastating damage to plans like the Western Conference of Teamsters Pension Trust (WCTPT): plans that are in strong condition, in the “green zone.” This new proposed legislation, called the GROW Act, must be stopped in its tracks. Teamsters Joint Council 28 is calling on all Teamsters to come together to put an end to this awful legislation.

The GROW Act, which stands for “Give Retirement Options to Workers,” is little more than a cover that would allow employer participants in multiemployer plans to shift all the risk from themselves directly onto the employee members of the plan. The GROW Act, which cannot be used by “red zone” plans and would therefore do absolutely nothing to help financially troubled multiemployer plans, would change the rules for these pension plans in a way that weakens the system as a whole and threatens our retirement security.

First, the bill would drain contributions from existing multiemployer plans to fund new composite plans – setting up both plans for failure and putting Teamster retirement benefits at risk.

Second, the bill would permit draconian cuts to workers’ promised benefits and subject retirees to devastating cuts to their pensions.

Third, the GROW Act would make it easier for employers to withdraw from pension plans without paying their fair share of the plan’s liabilities.

Fourth, the bill undermines the solvency of the Pension Benefit Guaranty Corporation (PBGC) because composite plans would be exempt from paying premiums, despite creating significant new liabilities for the PBGC due to the plan failures that would result from weakening plan funding.

And finally, under the GROW Act, workers lose the safety net of PBGC insurance coverage and face the prospect of total benefit loss in the event of a plan failure.

The WCTPT is the largest and most successful multiemployer defined benefit pension plan in the nation. WCTPT provides retirement security to over 600,000 families in all 50 states and nearly every congressional district. We rely on the WCTPT and the current multiemployer pension system as critical components to support the financial well-being of our families.

Therefore, as Teamster members and WCTPT beneficiaries – both present and future – we urge everyone to come together and voice our strong opposition to the GROW Act and to instead support efforts to sustain and strengthen the multiemployer pension system in a way that protects the retirement security of millions of American workers and retirees.

“We will not be fooled by legislation that claims to give us options but instead seeks to pull the rug out from under us,” said Teamsters Joint Council 28 President Rick Hicks. “The GROW Act poses a very real threat to our pension plan, and we will do whatever we can to protect the pensions we have spent our entire careers working to earn.”