Star Tribune management and strike-ready drivers continue to square off, both at the negotiating table and in bankruptcy court. Barring a agreement, a Strib brief defending its request to abrogate the drivers’ contract is due Friday, with a court hearing next Tuesday.
Thursday, a group of union rank-and-filers including reporters Randy Furst, Chris Serres and Steve Brandt and non-newsroom laborites issued a detailed rebuttal to publisher Chris Harte’s May 26 staff memo.
No one should infer a mass walkout based on the memo below; it’s fair to call the signers labor hardcores. However, they do provide the fullest assault within the building on management’s tactics, and could influence Strib locals if they must make a picket-line decision.
Here’s the memo:
Rank-and-File Solidarity Support Committee Newsletter
June 4, 2009 — An independent newsletter by and for the rank-and-file workers at the Star Tribune
The Star Tribune has issued a statement to employees suggesting that the Teamsters are being irresponsible in their pension demands. In an email to employees on May 26, the company said, “What we are asking from Fleet is no greater sacrifice than what we are asking of all Star Tribune employees.” The company statement is simply not true.
In fact, the company is demanding deeper, more permanent sacrifices from the Teamsters, when it comes to pensions, than it is seeking from any other labor group. The company memorandum is filled with distortion and inaccuracies in an effort to build up animosity toward our brother and sister trade unionists.
The truth is that the company has pushed the Teamsters’ back to the wall. Although the pension dispute is unresolved at this writing, the drivers’ union has already tentatively agreed to huge concessions, that includes, at minimum, a 26 percent reduction in wages. (That’s a bigger pay cut, for example, than many in the newsroom have taken, and newsroom workers have taken some big hits.)
Over the years, the drivers have deferred large wage increases so more of their base pay can go to their pension. Besides the drivers’ hourly pay, $5 per hour per driver is put into their pension (a combination of deferred pay from the driver and a contribution from the company.) Under the company plan, drivers will lose that $5 along with the 26 per cent wage cut, bringing the drivers’ total pay cut to a staggering 37 percent.
Let’s review other main points that the company is making, one by one:
The company claims that if it withdraws from the Central States Pension Fund, which the Teamsters belong to, it will have “no impact on most accrued, vested interests.” That is not true. The company proposes to cut off payments to Central States as of April 30, rather than waiting until June 15. If the company does so, a large number of drivers will lose a year of vested service in the pension. Several drivers alone will lose $500 from their monthly pension. Others will lose a portion of that amount.
The company claims it is putting $1.1 million a year into the Teamsters pension, which it says is far more than what it is paying into the other union pensions at the paper. That isn’t true, either.
Of the $1.1 million, only 40 percent comes from the company. The other 60 percent comes from the drivers who have accepted much smaller wage increases than other workers over the years, so as to divert more of their wages to their pension. In some years, drivers took only 10 to 35 cent an hour wage increases, putting the rest into their pension. The company is revising history by claiming it is all company money going into the Teamster pension. The company is paying in only 40 per cent, which comes to 7.7 percent of driver wages, not the 19 percent the company claims.
Using misleading language, the company implies that under its new plan, drivers would retain 80 percent of their pension benefits, even if it pulls out of the plan. That is not true, either. Under the company plan, the retired worker will retain 80 percent of their “lost benefits.” This is hard to understand, and the company does not want to explain it. Here’s the reality:
Let’s take the example of “Driver A” who is 53 years old. He has already seen a $500 loss in his monthly pension from about $2,800 to $2,300 because the company wants to stop paying into the pension on April 30.
The company isn’t finished, however. Under Central States Pension rules, if the company pulls out of the pension, Driver A will lose 6 percent of his pension for every year below the age of 65. Driver A is 12 years below the age of 65, so he’ll lose 72 percent of his pension (12 x 6 percent). His monthly pension falls to $644. That’s a loss of $1,656 a month.
But wait! The company proposes to “save” 23 drivers including Driver A. The company offers to pay 80 percent of Driver A’s loss. (80 percent of his loss of $1,656 is $1,325). So under the company’s “generous” plan, Driver A will retire with a pension of $1,969 ($642 + $1,325). Recall that Driver A has already lost $500 because the company proposes to stop paying into the pension as of April 30. So Driver A’s pension falls from 2,800 to $1,969 for a total loss of $831, or a 30 percent reduction in his pension.
But the company is planning an even bigger savings. It plans to cut 35 drivers through buyouts and/or layoffs, which will drastically reduce the amount the company puts into the pension.
While the company says Central States will be demanding companies put more into the pension, the company doesn’t tell you it proposes to reduce the number of Teamsters through attrition, rapidly shifting to a fleet of part-timers with small or non-existent pensions. The company claims it will face a huge pension liability unless it withdraws from Central States. But with far fewer drivers, the pension liability will drop.
The company says Central States would not budge on its position. That’s not true either. In fact, Central States has offered major compromises that the company has rejected.
The company makes it seem like all drivers will be able to switch to the company-sponsored plan. In fact, only 23 drivers would be covered. The rest will get only small pensions, if any, (because of penalties) from Central States when they’re 65-years-old. They get no company pension. While union workers in the Star Tribune pension plan are frozen, the drivers are frozen out.
It is imperative that workers and unions throughout the newspaper stand in solidarity with our brothers and sisters in the Teamsters. An injury to one is an injury to all!
David, I really appreciate your coverage of this. The Strib is unlikely to provide fair coverage and the PiPress has chosen not to provide the kind of Strib-ignored stories as they did with Par Ridder.
The most frustrating thing about being in a union is that the local media only talks to you when you’re on strike and then usually not sympathetically. The worst part of the newspaper monopoly is that it has resulted in Business sections that speak only to busting unions, not reporting on them (unless there’s some embezzlement going on).
We need a law that satisfies pension obligations before all other creditors in a bankruptcy proceeding. Investors know all about these pensions so there’s no hidden time bomb there. And had investors realized they were on the hook for these pension obligations the Strib would never have been sold and resold for so much more than they were actually worth.