Comprehensive Pension Legislation

Last week, Congressional leaders said that they expect to have votes on comprehensive pension legislation before their Memorial Day District Work Period at the end of May. Last year, the House and Senate passed different pension bills, and a conference committee has been meeting to negotiate a single piece of legislation that will then go back to both chambers for approval.

While the make-up of the final bill remains unclear, some information on the conference committee's deliberations is cause for serious concern. Most alarming is the fact that there is still support for the so-called "red zone" provision from the House bill. This language would allow pension fund trustees to reduce vested benefits. The inclusion of "red zone" language in the House bill forced the Teamsters Union to pull out of a coalition that was working on the legislation and withdraw support for the bill.

In addition to the red zone, other proposals remain on the table that would also be harmful to Teamsters and other working families who are relying on their pension for retirement. One provision would actually permit so-called small businesses—employers with 500 or fewer employees—to walk away from their pension obligations and in many cases tank the pension funds in which they participate. The Teamsters Union is on record in opposition to this measure and continues to lobby against it.

At the same time, the Teamsters are working to protect relief that was recently granted to the Central States Pension Fund by the Internal Revenue Service. This relief will permit the fund to recover from the stock market slump of 2001-2003. The final agreement must include the necessary provisions to maintain IRS relief and to avoid disrupting approved recovery plans. The Teamsters Union is closely monitoring the conference committee process to protect the IRS relief.

When the conference committee comes to agreement on a comprehensive pension bill and releases its report, the Teamsters Union will quickly analyze the legislation and its impact on pension funds in which Teamster participate. Should the bill prove harmful to Teamster members, the Union will lobby aggressively against it and mobilize the membership to work for its defeat.