Time is Now: Ahead of Congressional Hearing, UFCW Urges Action to Protect Retirement Savings for Millions of Workers
WASHINGTON, D.C. – Today’s House Education & Labor Committee hearing on the solvency of multiemployer pensions highlights the growing pressure for Congress to address this crisis. As one of the leading national voices, United Food and Commercial Workers International Union (UFCW) President Marc Perrone released the following statement:
“America’s promise has always been that anyone who works hard can build a better life for themselves and their family. When the retirement savings of millions of Americans is in jeopardy after they’ve worked hard their entire lives, that promise is being broken,” UFCW President Marc Perrone said. “Keeping that promise starts with protecting the pensions of today’s workers and retirees and making the strong investments needed to ensure the retirement security of generations to come. The time is now for Congress to pass the Rehabilitation for Multiemployer Pensions Act to protect these pensions before the crisis becomes even more costly and widespread. The retirement security for millions of workers and their families is on the line. We can’t wait any longer.”
UFCW Call for Action on Multiemployer Pensions
UFCW has been a strong national advocate for pensions reform and is calling for Congress to pass H.R. 397, the Rehabilitation for Multiemployer Pensions Act. Last year, UFCW sent a letter to Congress urging action on legislation to provide low-cost loans to eligible multiemployer pension plans to enable them to continue to pay earned pensions to retirees and fund their long-term pension commitments. Today, Congressional leaders echoed this call for action:
“The American workers in these failing multiemployer pension plans did everything right. They planned for their retirement, year after year choosing to contribute to their pensions instead of taking a wage increase. But now, after working for decades, their planned retirements may be taken away from them,” House Ways & Means Committee Chairman Richard Neal (D-MA) said. “And taken away at a time when they’re no longer able to prepare for retirement because they’re now in retirement. There’s no time to waste in addressing this crisis.”
“More than 60,000 Ohioans and 1.3 million workers and retirees nationwide face a looming pension crisis that threatens their financial well-being and their ability to care for their loved ones. What Washington doesn’t understand is that these workers gave up money at the bargaining table and sacrificed raises for these pensions,” U.S. Senator Sherrod Brown (D-OH) said. “These workers aren’t asking for a bailout, they’re asking for what they earned. Ohio workers, retirees, businesses and taxpayers are counting on Congress to solve this crisis, and the cost of inaction is too high. It’s time for Congress to step up, do the right thing, and solve this crisis now to give workers and their families the peace of mind they deserve.”
Why Congress Must Pass the Rehabilitation for Multiemployer Pensions Act:
The Rehabilitation for Multiemployer Pensions Act is a common-sense way to shore up the multiemployer plans while protecting the earned pensions of retirees and active workers.
- An estimated 10 million workers and retirees are in about 1,400 multiemployer pension plans. (PBGC)
- The failure of pension plans would hurt not only individual retirees, but also their local communities, the plans’ contributing employers and the future of the multiemployer retirement system overall.
The Rehabilitation for Multiemployer Pensions Act provides a path forward to address the country’s growing pension crisis by providing the financial support the plans need to avoid insolvency.
- If nothing is done, some troubled plans will fail and retirees will face massive cuts to the benefits they earned over decades of work.
- If the plans are allowed to fail, not only will they no longer be able to pay promised benefits, but taxpayers would be at risk of having to pay billions to cover the Pension Benefit Guarantee Corporation (PBGC) shortfall.
The Rehabilitation for Multiemployer Pensions Act would create a Pension Rehabilitation Administration, within the Treasury Department, to provide low-cost loans to qualified underfunded multiemployer pension plans.
- Plans would have up to 30 years to pay earned retiree benefits, prudently invest the loan proceeds and employer contributions, and re-pay the loan.
- During the loan period, employers may not reduce contributions and the plan may not increase promised benefits.
- The plan must demonstrate that receipt of the loan will enable the plan to avoid insolvency, pay benefits and loan interest, and accumulate sufficient funds to repay the loan principal when due.