The Building Tradesman Newspaper

Friday, June 26, 2015

News Briefs

By The Building Tradesman

Who will fund prevailing wage ads?

Indiana’s repeal of its common wage (aka prevailing wage) law in May for the construction industry included an advertising war, with unions spending $1.1 million to support the law and others spending $400,000 to repeal the law.

While the two biggest advertising  Indiana spenders on the union side are common knowledge – the Operating Engineers and the Laborers – the spenders on the repeal side funneled money through a  501(c)(4) non-profit, and can legally remain anonymous, says the Indy Star.

Michigan will likely have its own advertising battle this summer over signing prevailing wage petitions, and it’s unlikely labor unions here will know our enemies, either.

Pension panel's loan offer roils industry

WASHINGTON (PAI)—The federal Pension Benefit Guaranty Corporation will offer loans to financially troubled multi-employer pension plans, but only if they cut current benefits first, the agency said on June 19.

But in another indication the issue is still unsettled, a coalition of unions led by the Painters, the Teamsters and the Machinists joined the non-profit Pension Rights Coalition and a group of progressive lawmakers to demand repeal of last year’s multiemployer pension law changes.

That law, speakers said, lets pension fund trustees take some lifetime benefits away from current retirees – the cuts the PBGC mandated in issuing its new rules.

“The system is rigged and the rug is being pulled out from underneath you in many ways,” Sen. Bernie Sanders, Ind.-Vt., told the several hundred workers and their allies gathered on Capitol Hill for a June 18 outdoor press conference.  One of the “pulls” is to let trustees of financially troubled multi-employer plans cut present pensions, declared Sanders. 

Most building trades unions supported the new multiemployer benefit rules adopted by Congress last year, fearing worse cuts in benefits and more funds going belly-up if federal pension law was not changed.

The PBGC said the loans “expand its efforts to help prevent the insolvency of financially troubled multiemployer pension plans. Under the rule, troubled plans may apply to PBGC for financial assistance to fund a portion of their benefit liabilities in order to remain solvent.”  Plans that could run out of money within 20 years could seek the loans, it added.

The nation’s 1,400 multi-employer plans are jointly run labor-management pension plans common in construction, food manufacturing and other industries.  They cover some 10 million workers.  PBGC calculates plans covering 1.5 million workers are in trouble.

Speakers at the rally say cutting present pensions is not the answer for troubled multi-employer plans.  They noted that individual pensioners could see their monthly payments cut by one-third or more, from $3,200 to $2,000 in several examples. They demanded repeal of the new law, enacted in the waning minutes of the last Congress.