UPTE-CWA E-Bulletin: December 20, 2012
  1. Our RX/TX/HX Bargaining Objectives  
  2. Union Actuaries Demonstrate that UC exaggerates Pension Costs…And Then Rejects The Consequences Of Their Own Assumptions 
  3. Low Paid Part-Faculty UPTE Members Eligible For Health Benefits Assistance 
  4. Livermore Lab Radically Cuts Job Security
(1) Our Bargaining Objectives

What are our goals in bargaining?
  • Retirement security
  • Ability to retire at a reasonable age
  • No second class employees
  • Stop the race to bottom

In short, nothing less than preserving the middle class lives that unions created over the last century!

Together with other UC unions we will:

  • Reject UC’s two-tier proposals for pension and retiree health benefits, and
  • Propose a responsible alternative that will actually make the contributions to our pension fund that actuaries recommend.

Last week UPTE bargained for all our UC units. Our HX team made a pension proposal to UC that rejected the two tier plan. Chief negotiator Wendi Felson explained how we can all afford to stay on the same pension plan based on the analysis by the actuaries hired by our union coalition.

Watch the video report of the first TX/RX bargaining session on our YouTube channel.

(2) Union Actuaries Demonstrate that UC exaggerates Pension Costs …And Then Rejects The Consequences Of Their Own Assumptions
Should we accept the retirement benefit analysis UC has crafted to convince us to accept their two tier plans? We have combined resources with AFSCME (service/patient care technical workers) and CNA (nurses) to hire our own actuaries and they say “No!”.

They point out that while UC claims that the responsible contribution at this time should be 28.6% (Segal Report to Regents July 2012), they have not done that and have no plans to do so in the future. We must conclude they are either irresponsible or the 28.6% contribution is not real (or both!). Our actuaries question the assumptions UC provided to their actuaries:
  • Front-load the repayment of the (what UC claims is) underfunded portion of the pension fund. This costs about 3% more for the next several years. This adds up to $1 billion in savings over the next 4 years!
  • Assumes a discount rate (how much they make through investments) of 7.5% when the usual rate is closer to 8% and UC has made over 9% on average over the last 20 years. If we changed the rate to 7.75%, we save about 4%.
  • UC makes the unrealistic assumption that employees on average receive a 5% annual raise. More accurate estimates would bring the cost of the pension down another 1%.
These three changes bring down the required contribution to less than 21%. We can do more. Even though public pension funds are considered responsibly funded at 80%, the UC Regents have insisted on 100% funding. 100% funding is only required if UC plans to go completely out of business (and even then the state of CA would be responsible for our pension obligations). If we set a goal of 90% funding, the required contributions can be lowered further.

Creating the second tier for the pension does not save any money because it only applies to employees who have not even been hired yet. A small additional contribution of about 1% starting now would more than make up for any savings from the creation of a second tier for the next decade.

(3) Low Paid Part-Faculty UPTE Members Eligible For Health Benefits Assistance
The new health care law provides subsidies for employees making less than 4 times the poverty level ($44,000 per year for an individual and more for family). The community colleges where UPTE part-time faculty members work provide no health insurance, even though many have taught for decades.

You can calculate the approximate amount of subsidy you will be eligible for at the UC Berkeley Labor Center website. Those who are not eligible for a subsidy can still buy into the fairly cost efficient and quality-controlled plan which for an individual is less than $400/month.

(4) Livermore Lab Radically Cuts Job Security
In a cryptic message with links to bureaucratically worded policies, the Livermore National Lab announced that they will be eliminating seniority, laying off employees between assignments and engaging in targeted reductions in force that could include as few as a single employee, effective January 1, 2013. The changes will not affect the skilled trades employees that are covered under the UPTE collective bargaining agreement.

UPTE activists have put out the information to the lab at large and begun a campaign demonstrating how this dramatic curtailment of basic job rights will negatively undermine the scientific and development missions of the lab as recruitment and retention of quality staff becomes even more difficult.

The UPTE E-Bulletin is prepared by UPTE-CWA President Jelger Kalmijn. If you have any questions or comments, please do not hesitate to write him at president@upte-cwa.org.

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