Investigation To Reform Teamsters' Central States Pension Fund Found Inadequate (2024)

FAQs

Why is the Teamsters pension fund in trouble? ›

Highlights. For many years, the Teamster's Pension Fund trustees have been the subject of allegations of misuse of the Fund's assets. Therefore, the Department of Labor initiated an investigation of the Fund and, in response to a congressional request, GAO reviewed the Government's investigation.

A failing pension fund that received a $35.8 billion federal bailout has returned $126.5 million to the government following a determination that its application for aid included about 3,500 dead people.

Generally, your retirement assets should not be at risk when a business declares bankruptcy, because ERISA requires that promised benefits be adequately funded and that retirement funds be kept separate from an employer's business assets and held in trust or invested in an insurance contract.

2023 Funding Level 98.5% Funded

In April 2024, Central States Pension Fund reported that its actuary determined the funding level of the plan to be 98.5% funded as of January 1, 2023, and on track to reach full funding in coming years.

If there is any “crisis” for pension plans, it starts with the costs of paying for growing unfunded liabilities. State and local pension funds reported more than $1 trillion in unfunded liabilities in 2020. They reported just under $1 trillion in funding shortfall for 2021.

When this happens, the bankruptcy courts may allow the company to terminate the plan and the PBGC is then forced to step in and continue the pension payments to the employees.

Since 1955, the Central States Pension Fund has paid retirees and beneficiaries all promised benefits. The Central States Pension Fund is now on solid ground as we move over time toward the goal of being fully funded.

These plans are insured by a federal agency – the Pension Benefit Guaranty Corporation (PBGC) – which provides partial protection of the benefits of approximately 11.2 million workers and retirees in approximately 1,400 private-sector multiemployer, union-connected plans.

As notified previously, Yellow's participation in the Central States Pension Fund remains terminated effective July 23, 2023. As of July 23, 2023, active members stopped earning additional pension benefit accruals on that date.

However, if you have a traditional pension plan that your employer is contributing money toward, your employer can take back that money in the event that you are fired. However, if you are vested in the pension, then all the money in the account is yours to keep, even if you quit or are fired.

Can a pension run out? ›

Key Takeaways. Pension payments are made for the rest of your life, no matter how long you live. Lump-sum payments allow you to immediately spend or invest your pension as you like. People who take a lump sum may outlive the payment, while traditional pension payments continue until death.

If you are in a cash balance or 401(k)-type plan you will have the right to either leave your retirement money in your employer's plan when you leave the job or, if the plan rules permit, take your money out.

California, Illinois, New Jersey, and Texas have the most public pension debt. Newly released forecasting by the Pension Integrity Project indicates that state pension systems will likely remain at historically high debt levels.

A UPS (or freight, carhaul, etc) Teamster with 30 years can presently retire with $3,050 at age 62, or $2,913 at age 57. 25-at-57 is presently $2,413.

Statement: Joe Biden's $36 billion for a union pension fund is “the largest private pension bailout in American history.” When President Joe Biden directed $36 billion to a Teamsters pension fund, he said it would prevent drastic cuts in pension benefits for 350,000 union workers and retirees.

Traditional pension plans have been on the decline, primarily due to the economic strain they place on companies. Employers often bear the heavy responsibility of fully funding these plans; a task made more challenging by unpredictable market volatility and fluctuating investment returns.

Being a Teamster member means that you belong to the strongest and most democratic labor union in the world. For more than 100 years the Teamsters Union has been a leader in setting the standard for higher wages, better benefits and improved working conditions for workers throughout the United States and Canada.