Union Pension

DOL's Revised Union Trust Disclosure Rules Leave Major Loopholes -- And Even DOL Admits It!

Stefan Gleason — Wed, 01 Oct 2008 10:28:21 -0400

Yesterday, the Department of Labor’s Office of Labor-Management Standards (OLMS) posted on its website a weak final rule which revises standards governing disclosure of certain expenditures of union trusts, including union pension funds, strike funds, and credit unions.

Earlier this year, OLMS sought comments from interested parties concerning the new standards. On April 14, Glenn Taubman, staff attorney at the National Right to Work Legal Defense Foundation and counsel for the National Right to Work Committee, submitted comments regarding the gaping "sensitive information" loophole which allows union bosses to hide the very waste, fraud, and corruption that are all too common in these notoriously mismanaged and underfunded union trusts:

Union Accountant's Financial Analyses for New York Legislature Were " A Step Above Voodoo . . ."

Will Collins — Wed, 04 Jun 2008 17:31:00 -0400

The New York Times has a devastating article up on the incestuous relationship between public sector union officials and the New York state legislature. The actual controversy is downright farcical: legislators relied on a public sector union accountant to determine the cost of proposed increases to the state's employee pension plan.

A reasonable observer might suggest that this arrangement represented a clear conflict of interest, but to New York state legislators it was just good book-keeping. According to the Times, the union actuary "reviewed" hundreds of bills for the state before being exposed by the paper's investigation. What's more, the Times reports that the actuary neglected to mention additional legislative costs of up $500 million in his original reports.

Union Officials Selling Out Workers’ Pensions

Patrick Semmens — Thu, 25 Oct 2007 17:33:55 -0400

Yesterday, John told us how employee John McHenry was told that to get out of the Teamsters-controlled pension plan he would have to “quit, be fired or die.”

An article in yesterday’s New York Post demonstrates why McHenry was wise to opt out of the union pension plan. In addition to being massively under-funded (only 3.2% of multi-employer union pension plans have enough assets to pay the promised benefits), it seems that NEA union officials have taken to getting kickbacks for endorsing under-performing, high-fee investment plans to teachers:

Not including management fees, the NEA's only officially endorsed "retirement program" - the Security Benefit Life Insurance Corporation's Valuebuilder annuity - charges 0.9 percent to 2.6 percent a year. Throw in management fees, and the least expensive option costs a teacher 1.73 percent of her account balances each year, while the most expensive costs 4.85 percent.

Over time, a fee that large is devastating. Without inflation, the educator would have to earn nearly 5 percent each year simply not to lose money. Consider a teacher who socks away $500 a month and earns an average yearly return of 10 percent for 35 years: She'd wind up with $1,788,760 upon retirement - quite a sizeable nest egg. But if she were paying 4.85 percent in fees, she'd accumulate less than one-third as much - just $587,854.

It appears that the NEA is willing to endorse a shoddy plan in exchange for a contribution to its coffers. In 2004, the union collected nearly $50 million from the investment vehicles it endorsed.

The Only Way Out of a Union Pension is to “Quit, be fired, or die”

John Powell — Wed, 24 Oct 2007 13:01:57 -0400

When a company official told Perfecseal, Inc. employee John McHenry and his coworkers that the only way out of a union-controlled pension fund was to “quit, be fired, or die,” they fought back.

With help from Right to Work attorneys the employees forced Teamsters Local 14-M officials to stop requiring the pension fund contributions, though union officials stopped short of returning the pension fund money that John and others already contributed.

Like many employees, John continues to feel intimidated at his workplace. But when one company official said John’s “name was mud” and claimed that “corporate” was “pissed” at him for standing up for his legal rights, John refused to back down.