Pension Plans, Shortages, and the Employee Free Choice Act
Friday, April 10th, 2009 by adminMegan McArdle has an interesting, and troubling, blog post on the massive under-funding of public-employee pensions. But as she declares “Politicians had gotten into the habit of promising generous pensions as a “cheap” giveaway to powerful unions,” it ought to be remembered that there is a massive problem with private funds that are in the same situation. Organized labor needs to get new members to pay for its failing funds, and the Employee Free Choice Act is one way to get those members in the door — and in the troubled pensions
Tags: Pensions
April 10th, 2009 at 1:00 pm
Matt Austin says:Unfortunately, the severe underfunding is not limited to public pensions. When I have clients who withdraw from the union, they are faced with astronomical underfunded (”withdrawal”) liability – in the hundreds of thousands of dollars – even though they have dutifully paid their portion into the fund. Under federal law, this liability attaches to sister companies and owners/shareholders even if the unionized company that withdraws from the union’s pension plan is sold or declares bankruptcy.