By Miriam Raftery
Photo credit: John Vachon, Alabama truck driver, Library of Congress TRUCKING PAST
October 20, 2015 (Washington D.C.) – Congress has crumpled the security net for many retired union workers. A controversial law passed last December allows multi-employer pension funds to cut benefits if the funds are projected to run out of money. CNN reports that many of these funds, which cover over 10 million works, are in financial trouble.
One of the first to take advantage of the new law is the Central States Pension Fund, which has been teetering on insolvency and now wants to cut benefits as much as 60% for retirees who are reliant on its pension payments—if the Treasury Department approves the deal.
The fund covers workers and retirees in over 1,500 companies ranging from truck drivers and construction workers to Disneyland employees.
Before the new law, which was pushed through by conservatives in control of both houses of Congress, people already retired would have been protected against such cuts. But now it’s open season on benefits they had counted on to take care of them in their golden years.
Hardest hit will be workers whose ex-employers have gone bankrupt. The only retirees safe from cuts are those age 80 or older, those cuts will be somewhat less for those over 75. The average cut is around 28%, Central States Pension Fund has indicated.
For retirees suddenly faced with living on half or less of their former pension checks, the future may be grim. Finding work for older Americans is tough in the best of circumstances, and for some facing medical problems in their senior years, the outlook is even worse.
The Treasury Department has 225 days to approve or reject the pension cutting plan, which Central States Pension Fund says is needed to prevent it from running out of money in the next 10 years and blames deregulation of the trucking industry in the 1980s for the loss of 10,000 employers who contributed to the fund in the past.