Union officials sue MBTA after arbitrator proposes slashing pensions of those who retire before age 65

Link: https://www.bostonglobe.com/2022/09/26/metro/union-officials-sue-mbta-after-arbitrator-proposes-slashing-pensions-those-who-retire-before-age-65/


The MBTA’s largest union is challenging an independent arbitrator’s decision that would reshape the rules of the authority’s $1.66 billion retirement system, including slashing the pensions of those who retire before the age of 65.


Still, after more than four years of negotiations over a pension agreement, it’s unclear what exact changes could come to the MBTA’s retirement fund, where the number of retirees has long outpaced the amount of workers paying into it, and MBTA officials have long pressed for sweeping changes.

As of the end of last year, the fund’s unfunded liability hovered at more than $1.3 billion, and, despite changes that went into effect a decade ago to stem what were considered lavish retirement perks, younger retirees have continued to flow into the retirement system, creating more financial pressure.


The arbitrator’s decision included a series of changes, most notably in lifting the age at which a retiree would collect an “unreduced” pension. Under the ruling, workers who opt for early retirement — in this case, before the age of 65 — would have 6 percent deducted from their pension benefit for every year of retirement before the age of 65.

Currently, anyone who is 55 and has at least 25 years of service qualifies for a so-called normal monthly pension, calculated at 2.46 percent of the average of a person’s three consecutive highest-earning years, multiplied by years of service.

Author(s): Matt Stout

Publication Date: 26 Sept 2022

Publication Site: Boston Globe

COVID rescue package gives failing pension plans a $86 billion bailout, stirring hope and criticisms

Link: https://www.bostonglobe.com/2021/03/13/nation/covid-rescue-package-gives-failing-pension-plans-86-billion-bailout-stirring-hope-criticisms/


In the shadow of stimulus checks and extra unemployment aid, Democratic lawmakers extended another hand in the $1.9 trillion pandemic relief package: a long-sought bailout for failing private pension plans.

The union-backed provision, touted for years by Representative Richard E. Neal, was signed into law Thursday by President Biden as part of the larger COVID-19 stimulus bill. It promises to set aside an estimated $86 billion — and some say possibly far more — in grants for multi-employer retirement plans that were careening toward insolvency even before the pandemic hit.

Without it, the multi-employer pension plans for more than a million truckers, warehouse and retail workers, and others could collapse, unions and congressional Democrats warn. In New England alone, the measure could help preserve the promised retirements of at least 70,000 Teamster members, union officials said.

Author(s): Matt Stout

Publication Date: 13 March 2021

Publication Site: Boston Globe