sep13-congressweighsaideforpensions

According to this recent report in SHRM, more than a million Americans currently have their retirement savings in union-managed multi-employer pension plans that are severely distressed and headed for default in the near future.

On Sept. 8, a plan was introduced in Congress to modernize the multi-employer pension system. The plan outlined the following:

The union responsible for the funding issue is looking for a bailout, but opponents are wary of the precedent.

“The UMWA trustees have failed to adequately adjust benefits and contributions over time to ensure that promised benefits would be paid,” wrote Rachel Greszler, a senior policy analyst at the Heritage Foundation, a conservative think tank, in an online post. But “instead of acknowledging its failure to live up to its promises, the UMWA is attempting to pass the buck to the United States government and taxpayers.”

This may be the first in a long line of collectively-bargained pension-related issues in the near future.  “Government reports have estimated that up to 15 percent of multi-employer plans are at risk of becoming insolvent over the next 20 years and that up to 1.5 million participants are at risk from those insolvencies,” noted National Law Review authors Bradley G. Kafka and Andrew W. Douglass.

CLICK HERE TO READ THE ARTICLE.

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