Retired with benefits? Don’t count on them‼️

Let’s say you are a member of a good union and the union has negotiated a nice benefits package including health benefits when workers retire.

Those benefits were negotiated over several contracts during which there were tradeoffs in wage increases, cost sharing of active employee benefits, etc. In other words, active workers paid for their future retirement benefits; they are deferred compensation.

The union and the employer made an agreement in good faith; they made a commitment, a commitment workers believed they could count on perhaps planned their future retirement on.

Not so fast‼️

Once a worker retires all past agreements are irrelevant, they have no protection. Today, they are a member of a union, tomorrow when they retire they are not a union member, the union cannot negotiate for them and cannot protect them. The employer can change or terminate the benefits that were negotiated for them and which they and all active employees paid for.

Employers can pick and choose the changes they want to make. Let’s say you retired with health benefits and the employer agreed during collective bargaining to pay 70% of the premium cost. Now it decides instead it will give workers a fixed lump sum and all future premium increases are on the retiree…or the employer can simply ignore all past agreements and terminate all benefits.

This is the ultimate Catch-22. Workers can’t win. They pay for something one day only to have it taken away the next. ERISA protects pensions; earned pensions cannot simply be taken away, but there are no protections for other benefits.

Even if unions could bargain for retirees, why should they? Retirees are not members, they can’t vote in union elections and they don’t pay dues.


  1. I get your point about retiree promised benefits from a company. I think the same can be said about promised governmental entitlements. That can also change with a stroke of a pen. Termites are always eating at the three legs of a good retirement plan (pension, social security, personal IRA). I can handle the loss of anyone leg or the crash of the stock market but not a loss of two. During my working career I saw pensions go away and retiree loose benefits at some big corporations so I was forewarned. Sadly too many people are planning to depend on only two legs IRA & social security and we know how well they are saving money in their IRAs. I do not know how the future retirees will build a stable two legged stool that can stand a loss of one leg or maybe two legs.

    You can only depend on yourself.


    1. Local 94 never even gave benefits 2000 employees a chance, they gave away our health benefits after retirement, we get nothing. We leave with our cash balance pension plan, our 401k and a kick in the ass


      1. Not true at all. Benefits 2000 was specifically put in place to allow FUTURE employees to make a choice of employment or not. It was all upfront. Nothing was taken away from anyone. It was a new deal, still better than most employers who did not and still do not have any pension.


      2. It was the writing on the wall at the time. I remember IBM, HP, DuPont, most airlines that did and did not go bankrupt, steel companies, etc all do away with the benefits to both current and those who already retired. We screwed the unborn also known as “future hires”. Those of us who were against it realized that the unborn would, at a future time, get to screw us retirees that got benefits. I don’t blame them. I fully expect that to happen.


  2. Why do unions almost always endorse democrats when our current president has the lowest unemployment record and best stock market growth in history?


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