From:

To: Senator or Representative __________________________

More Protections For Workers And Retirees Needed In Pension Reform Legislation

I live in ___________________ and I'm a retiree of _____________________.  I'm one of the more than 2 million retirees affiliated with the National Retiree Legislative Network.

I'm old enough to remember when the adage "a promise made is a promise kept" was sacred.  Corporations-the blue chip ones and not just the ones on the verge of bankruptcy-are breaking their promises to workers and retirees for secure pensions.  As a member of Congress you have an opportunity to strengthen the protection of pension plans for millions of Americans. 

The Conference Committee on Pension Reform, and then the House and Senate, needs to move forward on legislation that is in the best interests of workers and retirees. The stronger pension funding requirements in the bills are good.  However, I'm concerned about two major issues in the pending legislation.  

A number of companies have scrapped their defined benefit pension plans and converted to cash balance plans that have reduced pension benefits by as much as 50 percent for some workers.  Now these companies are lobbying Congress for protection from employees' and retirees' lawsuits. Congress should not change the law retroactively to protect those companies that acted unfairly and unlawfully.  I urge you to oppose any provision in the legislation that retroactively legalizes the conversion to cash balance plans that have resulted in older workers suffering the "wearaway" of pension benefits earned through years of labor.

I was very please to see in news reports that on April 6 the U.S. House of Representatives passed on a vote of 248 to 178 a motion to instruct the House conferees on the Pension Reform Conference Committee to adopt the cash balance provisions of the Senate bill that protects older workers in cash balance conversions.  Although the House vote is a major step forward, the motion only addresses protecting older workers for future cash balance conversions but does not prevent the retroactive legalization of past cash balance conversions. I hope all Conference Committee members will support the protections for older workers and prevent retroactivity related to cash balance plans and that it will eventually be passed by both chambers of Congress.  

Corporate lobbyists are also trying to get Congress to make it easier for employers to take money out of their pension plans.  Currently, only companies that have pension plans that are 25 percent overfunded are allowed to remove the "surplus" to use for retirees' health care insurance. You should not agree to go along with the corporate lobbyists' scheme to lower that "surplus" limit to 15 percent.

When the corporations say they will use the money to buy health insurance for their retirees, what they really mean is they don't want to live up to their commitments to pay for health care insurance any more.  A longer maintenance of cost period for health care and promises to restore funding levels to 115% will do little good if the employer's deteriorating financial situation impairs its ability to fully fund its pension plan, resulting in more plan terminations or freezes.  

While you and your colleagues are working on the pension legislation, I urge you to strengthen the pension plan disclosure requirements.  Also, it would be good to require investment advisors for 401K plans not to have potential conflicts of interest in the investments they recommend to workers.

Members of Congress are covered under a pension plan that is secured by the very taxpayers who are now being stripped of their retirement benefits by corporations.  As you decide the pension laws that we will live under for years to come, I hope you will think about what protections you'd want to enact if it was your pension that was at risk.