International Brotherhood of Teamsters local unions on the East Coast and in California that represent 16,000 employees of Costco Wholesale Corp. are recommending ratification of a new tentative agreement with the Issaquah, Wash.-based company, which includes opening the $36 billion Western Conference of Teamsters Pension Trust, Seattle, to new participants, said Rome Aloise, Teamsters international vice president and negotiations chairman, in an e-mail.
Full details of the tentative agreement are not being made available, but it differs from an offer rejected by members last month in that it does include the opportunity for the first time for East Coast members to participate in the defined benefit plan along with California members. Mr. Aloise said East Coast members will have two votes, one for contract ratification and one to participate in the pension fund.
“Both the California Costco members and the East Coast members participate in a 401(k) plan and will continue to do so. The East Coast members have had a discretionary contribution from the company each year based on years of service and a percentage of total income. The California members participated in the Western Conference of Teamsters Pension Trust Fund in lieu of the discretionary contribution. Both groups will continue to have an hourly amount contributed to their 401(k) plan in addition to the contributions to the pension plan,” Mr. Aloise said.
The potential entry of new participants into the pension fund stands in stark contrast to the $16.1 billion Teamsters Central States, Southeast & Southwest Areas Pension Fund, Rosemont, Ill., which last year applied to the Department of the Treasury to cut pension benefits for most participants in order to forestall insolvency, which it estimates will occur in 2024. That application is pending.
Source: Pensions & Investments