Sunday, March 29, 2015
Shortfalls sabotage promise of union retirees' pensions
At 60, he had saved enough to supplement his union pension for a couple of years until he could collect Social Security.
But he is rethinking his plans because he may not have enough money.
“I'm probably going to go back to work,” said Rossi, a Penn Hills resident and former president of Teamsters Local 249. “Because of the potential cuts to my multi-employer pension fund, I'm probably going to go back to work until I'm eligible for my full Social Security.”
Once considered sacrosanct, many retiree pensions may no longer be secure. A change in federal law passed last year with bipartisan support would allow struggling union pension funds to cut benefits for retirees younger than 75 by as much as 60 percent.
The law applies only to the most severely underfunded private-sector, multi-employer plans, or those that include more than one company's workers.
Declines in union membership and expanding life spans of retirees were threatening the solvency of union pension funds when the financial crisis in 2008 brought huge investment losses.
Some funds recovered. But many have not, and have the option to pull back commitments to individuals who could be more than a decade into retirement.
Full story here..........