Pension & Benefits
May 24, 2013: Ken Hall vowed UPSers would not pay for our healthcare.
But under the tentative agreement, 140,000 UPSers would be moved into an inferior plan that will force them to pay a lot more for healthcare.
Just a few months ago, Teamsters turned out across the country in huge numbers to attend rallies and chant, “No way, we won’t pay!”
Now healthcare concessions has gone from uniting Teamsters against UPS to uniting many members against the contract.
Opposition to the healthcare givebacks has run especially high in locals where both full-timers and part-timers would be moved into the Central States TEAMcare plan.
This includes Pennsylvania, New Jersey, Indiana, Illinois, Iowa, Michigan, Minnesota, Nebraska, most of Ohio and Missouri, Southern California, and the Southwest.
TEAMcare would mean more deductibles, higher Rx costs, limited dental coverage, and higher co-pays on everything from ERs to lab tests, MRIs and procedures.
Members opposed to the cuts have passed out bulletins and FAQs put out by Make UPS Deliver at UPS and at contract meetings.
In Philadelphia Local 623, members printed up their own Vote No T-shirts and have flooded the air hub there.
“It feels good to walk around the second largest air hub in the U.S. and see nothing but Vote No T-shirts,” said Local 623 member Bobby Curry.
A “Vote No on UPS Contract” Facebook page has connected 2,000 followers who are getting active around the healthcare concessions.
Some Western locals and New Jersey Local 177 got an extension to Nov. 1 to find an alternative plan. But they get the same reduced money from UPS to pay for coverage, which is less than members’ current plan costs.
Any alternative to TEAMcare would only have to match the benefits in Central States TEAMcare, not the current plan.
UPS is making $5 billion a year and Teamsters were promised no concessions.
Why did the International Union agree to healthcare cuts?
“It seems ridiculous that a company earning record profits can’t maintain what we already have,” said Roger Austin from Local 215 in Evansville, Ind. “They seem to have forgotten they negotiate for us, not themselves.”
May 24, 2013: UPS will save billions in lower pension costs during the life of the new contract as the company reaps the financial rewards of pension deals in the Central and Southern Regions and New England.
For the next five years, UPS will pay very substandard contributions in two of the largest pension plans covering more than 50,000 UPS Teamsters.
Under the new contract, UPS will actually reduce its pension contributions in New England by $2.30 an hour. UPS will contribute just $6.20 an hour into the New England Pension Plan and contributions will be frozen at that rate for ten years.
By comparison, UPS will contribute $9.90 an hour into the Western Conference Pension Fund for full-timers and part-timers starting Aug. 1, and that figure will go up 50 cents every August—unless money is diverted away from members’ pensions to maintain their health benefits under the new healthcare deal.
By the end of the year, UPS will be paying just under $12 per hour for Teamster pensions in the West and just $6.20 an hour for Teamster pensions in New England.
The company’s savings are even more extreme in the IBT-UPS Pension Plan that covers 44,000 UPS full-timers in the Carolinas and Central and Southern Regions. UPS contributes less than $4 an hour into that fund.
Together, the two pension deals will save UPS more than $4 billion during the next contract alone.
It’s true that UPS had to pay $6.1 billion to pull out of the Central States Pension Fund. But the company will make all that money back, and more, by the end of this contract.
UPS also had to pay another $43 million a year in withdrawal liability under the New England pension deal. UPS will save millions more than that in reduced pension contributions in New England.
The Bottom Line
Most Teamsters don’t think much about our pensions beyond how much our monthly check will be.
The pension accrual for UPS Teamsters in New England is guaranteed for the next ten years.
The 30-and-out pension for UPSers in the Central, South and Carolinas will go up to $3,200 a month.
The annual accrual rate is frozen for another four years and then goes up only $5 in the fifth year which will keep benefits in the largest pension plan covering UPS Teamsters the lowest in the country.
The company takes the long view on pensions.
By the end of the contract, UPS will have made back the $6.1 billion in withdrawal liability it paid to Central States and will continue to save billions in reduced pension costs into the future.
“UPS has a long term plan on pensions; Hoffa and Hall don’t,” said Dan Kane, a retired member of Los Angeles Local 63. “It’s only a matter of time until UPS comes after our pension plan. Why would UPS want to keep paying $12 an hour for pensions in the West when they’re paying half or a third of that in Boston, Louisville and Atlanta? Members need to take back this union to defend our pensions.”
April 22, 2013: More than 100,000 Teamsters will be moved out of their current health plan if UPS management gets its way in contract negotiations. Now some locals are demanding a separate vote on the issue.
UPS wants to move more UPS Teamsters out of company health plans. The company and Ken Hall were all but set on moving these Teamsters into the Central States Health & Welfare Fund. But members and some local unions are saying, “Not so fast.”
A debate has broken out on the National Negotiating Committee with some officers calling for alternatives to the Central States option and a separate vote by affected members only.
Officers from every local in the West held a conference call last week and spoke out against any transfer to Central States Health & Welfare Fund. Teamsters Local 177 which represents some 6,000 UPSers in New Jersey also joined the call.
“My local’s members deserve a separate vote on this issue,” an officer from a large affected local told TDU. “Members whose health benefits are going to stay the same should not be deciding whether our members get moved into a different plan with different coverage.”
The International Union organizes the ratification vote and has the power to give affected members a separate vote.
UPSers’ co-pays, drug costs, deductibles, and retiree healthcare costs would all go up under the top coverage that is currently offered by the Central States Health Fund, the C-6 plan.
The proposal to move UPS Teamsters out of company health plans would affect members in some of the largest UPS locals in the country, including locals in California, Illinois, Indiana, Iowa, St. Louis, Ohio, Iowa, New Jersey, and Philadelphia.
Part-timers nationwide are covered by company plans that provide coverage that’s superior to the C-6 plan.
Negotiations continue in Washington, D.C. this week. It’s too soon to know if the proposed contract will move Teamsters in company health plans in C-6 in the Central States, an improved Central States plan or alternative plans.
Stand Up Against Healthcare Cuts
Before contract negotiations began, Ken Hall vowed, “We’re not going to be talking about concessions, we’re going to be talking about improvements.”
Will this apply to Teamsters who will be moved out of their current health plan?
These members deserve a separate vote by affected members only and complete information on changes to their benefits and retiree coverage under any proposed new health plan.
That’s where we stand. How about you? Click here to send us a message and team up with other UPS Teamsters who are working together to oppose health benefit cuts and get a separate vote for Teamsters who would be moved into a different health plan.
April 19, 2013: UPS Teamsters and many local unions are raising red flags about members being moved into the Central States Health Fund. The proposal has sparked resistance from members and locals opposed to benefit reductions.
Officers from every local in the West held a conference call on Wednesday and spoke out against any transfer to the Central States Health & Welfare Fund. Teamsters Local 177 which represents some 6,000 UPSers in New Jersey also joined the call.
In Ontario, California, members flooded Local 63 with phone calls. Their Business Agent promptly came out to the air hub and promised there would be no changes in members’ health coverage.
Members in Iowa, St. Louis, Chicago, Ohio, New Jersey and Pennsylvania, have also voiced opposition to the plan. UPS Teamsters are concerned about changes to their healthcare, higher out-of-pocket expenses and changes in retiree coverage from higher eligibility ages to increased monthly premiums.
Management has been working a company game plan since the start of negotiations when they demanded that members pay $90 a week toward our health coverage. UPS never expected to win this demand but put it forward to try to scare and soften up members into accepting unfavorable changes in their benefits.
Hall promised negotiations would be about “improvements, not concessions.” Does that apply to healthcare?
Teamsters Want Options, Right to Vote
The locals on the conference call have floated proposals to move their members who are in company plans into a Teamster fund in the West that has superior benefits to Central States.
Ken Hall alluded to this in the latest negotiations update, saying “The Company has indicated a willingness to move employees who are currently in Company plans into Central States to provide coverage. The Committee discussed the possibility of offering proposals for other Teamster plans to provide coverage,” Hall said.
Contract negotiations resume Tuesday in Washington, D.C. Hall says that UPS and the International Union are both committed to wrapping up negotiations by the end of next week, four months before the contract expires.
If the proposed contract will move UPSers out of company plans and into Teamster funds, the members who are directly impacted by the change deserve a separate vote on the issue.
At Stake, Healthcare and More
UPS made record profits last year of nearly $4.5 billion.
UPS Teamsters should review the details of any tentative agreement carefully to make sure any early deal lives up the promise that Ken Hall made when negotiations began: “The more they make, the more we take.”
This should apply to all of members’ issues, including harassment, full-time jobs, excessive overtime, technology, pensions, part-time wage increases and more.
What’s Your Bottom Line?
With UPS making $4.5 billion, what kind of improvements do members deserve?
Click here to read Teamster for a Democratic Union’s Contract Scorecard.
Click here to see a summary of Central States healthcare coverage with co-pay and deductible information. The C-6 plan is the top coverage currently available to Teamsters in the Central Sates.
UPDATED April 12, 2013: Are UPS Teamsters presently in company plans heading for the Central States Health and Welfare Fund? That’s one proposal that UPS management has put on the table.
The International Union called a two-week break in negotiations to study this issue. So far, UPS Teamsters have only been told that management has proposed moving all UPS Teamsters into a union health and welfare plan.
Meanwhile, the Central States Health and Welfare Fund seems to be preparing to go national. The fund is even planning to drop the Central States name and perhaps rebrand itself as MyTEAMCare.
UPS wants to get retiree healthcare costs off of its balance sheets because of legal accounting changes. But how would switching to the Central States Health Fund affect Teamster members?
There’s no word yet on that from the IBT. Bargaining resumes on April 15.
Unlike the Central States Pension Fund, the Health and Welfare Fund is in good financial shape. It has 19 months of reserves, which is considered very healthy.
UPS Teamsters who are currently in this plan pay no monthly premiums. UPS retirees in this fund pay $200 per month for retiree coverage and $400 for retiree-plus-spouse coverage.
Switching UPS Teamsters into Teamster health plans may benefit members and our union. But UPSers have lots of questions, and they deserve answers.
Healthcare affects members and our families directly and personally. If major changes are in store for our health coverage, UPS Teamsters deserve full disclosure—all the facts and all the options—before any contract vote.
Click here to see a summary of Central States healthcare coverage with co-pay and deductible information. The C-6 plan is the top coverage currently available to Teamsters in the Central States.
March 15, 2013: Does a ten-year freeze in pension benefits sound too long to you? That is what half of all UPS full-time Teamsters could face, unless there are improvements put in Article 34 of the UPS National Contract.
The IBT-UPS Pension Plan covers Teamsters in 24 states (the southern region, the Carolinas, and most of the central region), but this plan has the lowest benefits of all Teamster pension plans!
Fortunately, that situation can be corrected now, in this contract. The benefit levels ($3,000 for 30-and-out; $2,000 25-and-out) are specified right in Article 34, Section 1, and have been the same since 2007 when the contract was ratified.
Unless there is a significant boost in benefits, they could be frozen until 2018, with no improvements for inflation. With inflation of three percent a year that $3,000 would be worth only $1,971 in 2018.
So a $1,000 increase in benefits is needed just to keep benefits from going backward.
The International union has already conceded that retirees under the company plan will have to pay more for health insurance in the future.
UPS runs this pension plan right out of the Atlanta headquarters. It costs them far less money than other plans for full-timers, because of the lower benefits and its status as a single-employer plan.
Don’t settle short and regret it later. Demand a pension increase. No excuses.
March 15, 2013: Some 50,000 UPS Teamsters stand to draw a pension from the Central States Fund, even though UPS was allowed to pull out of that fund in 2008 and set up their own IBT-UPS Pension Plan, run by the company.
The way it works is that UPS pays the pension until the retiree reaches 65. Then Central States pays its share of the pension (which would be most of it), and UPS makes up the difference with a second pension check, to provide the promised pension benefit.
Will they lose if Central States cuts pensions? The answer is found in Article 34, Section l, paragraph (l)(6) of the national contract: “If the benefit paid from the Central States Plan is reduced as permitted or required by law, the amount of such reduction shall not be included in the offset.”
The Hoffa administration says that single sentence protects UPS Teamsters. But experience with contract enforcement at UPS is that ambiguous language often hurts members.
It should be easy to fix this issue in contract bargaining with clear, unambiguous protection for retirees from Central States pension cuts.
General Secretary-Treasurer Ken Hall drew a line in the sand on the issue on a national conference call of local officers yesterday and announced a series of union actions by the International and local unions.
“We’re not paying $90. We’re not paying $9. We’re not paying 9¢. We’re not paying premiums for health insurance for a company that made $4.389 billion,” Hall said.
Hall said that UPS has been told they must drop the proposal when contract negotiations resume or the union will pull the plug on early bargaining.
“We will walk away from negotiations and see you in July,” Hall said.
Domestic package delivery is UPS’s most profitable division.
UPS pays CEO Scott Davis over $13 million a year.
Davis’s last pay hike was $2.3 million, including a pension increase.
Working Teamsters have delivered huge profits for UPS.
It’s time for UPS to deliver a fair contract, including a pension increase.
Click read the rest for more on the IBT-UPS plan and download the leaflet. Read the rest …
September 17, 2012: UPS Teamsters in New England have voted by a large margin to approve a pension change favored by the company and the pension fund. Voting took place at regional meetings, not by mail, so an estimated 15-20% of the 10,200 participants voted.
The proposal is to move all UPS Teamsters in the six New England states to a new plan which will still be within the New England Teamsters Pension Fund, but under very different terms. Approximately 20 other New England Teamster employers, including DHL have made a similar move.
Teamsters in the IBT-UPS plan get the lowest pensions of any UPSers in the country.
The next contract is our chance to win the higher pensions we deserve.
The cost of living is going up. But pensions for UPS Teamsters in the IBT-UPS plan are falling behind.
UPS always advised drivers with the safety tip to “keep their eyes on the big picture.” I’ve learned that’s really important when it comes to our pension and retirement.
Everybody talks about retiring after 30 years with a monthly pension check of $3,000. It’s important to remember that federal and state taxes will come out of that. Then there’s medical coverage including dental and vision if you need it (which most of us old-timers do). And while inflation may be relatively low now, it does add up over time. That $3,000 is locked in without a COLA so by the time we reach seventy or eighty, our pension check is going to be worth a lot less. So that $3,000 pension isn’t worth what it once was when we won it in the ’90s.
UPS pushed us to vote for getting out of the Central States because of our concerns for
retirement security. Teamsters now covered under the IBT-UPS Plan still need that peace of mind.
The best way to secure our retirement is to bargain for a larger pension contribution in the 2013 contract negotiations. UPS can afford it. More going into our pension fund means the Trustees can be pressed to raise that $3,000 monthly pension check. That’s what Teamsters need to enjoy the retirement they earned.
By: Mark Dray
UPS Feeder Driver (Retired)
Local 638, Minnesota
UPS Teamsters are joining together to win a better contract and stop the downward slide in our pensions.
The cost of living is going up. But pensions for UPS Teamsters in the Philadelphia Fund are going down every year.
Over the next ten years, the pension for a full-time UPSer retiring after 30 years will sink from approximately $3,900 to less than $3,200 a month.
Our pension benefits will be cut every year—unless we take action to win changes in our plan. What’s behind the Philadelphia Pension slide and what can we do about it?
UPS Teamsters earn dramatically different pensions depending on the plan they’re in—with the company-controlled UPS Pension Plan in the former Central States areas paying the lowest benefits by far.
The Pension Comparison Chart shows the range and variation of benefits for the great majority of pension plans covering UPS Teamsters.