Brothers and Sisters,
Some members raised concerns that they did not have enough information to know how to vote on the WWA allocation. In response we extended the vote as far as we could, until 9am tomorrow morning, in order to provide notice to contractors and clear our June 1st deadline of implementation. We also invited membership by social media and text alerts to a presentation by trustees, then Q&A this (Monday) evening.
Tonight at 5pm we held a live video presentation and Q&A for the WWA Allocation vote that ends tomorrow (Tuesday) morning. 1000 members responded on social media that they were interested in attending. At the meeting’s peak we had 167 total members in attendance. We had 30 minutes of presentation by the EST and the rest of the CTWW labor trustees. We had 45 minutes of Q&A from attending members. We’ve heard a few concerns that some members had trouble getting into the meeting. We are not sure why that is. We welcomed everyone who wanted to attend but if there were tech issues, we will get to the bottom of it and correct anything we are able to correct for future meetings.
We started the meeting by describing the structure of the trusts, how decisions are made, historical context, industry and hours reports, and the impacts of COVID-19 on the funds and contribution levels.
Allocation adjustments occur annually in most of our contracts to account for market changes in order to maintain strong benefits for members. This is one of the few contracts that allocates as part of the initial bargaining, rather than allowing for ongoing annual adjustments recommended by trustees.
None of the questions below were modified from the original form in which they were asked. The names that appear in the questions reflect the name of the member who asked, as it appeared in the chat. The only comments deleted were statements (rather than questions), logistical comments about getting into the meeting (initial struggles with audio, etc.) or requests from non-trustees to co-present during the presentation. There were some questions we ran out of time to answer- those questions (as well as answers) were compiled after the meeting and are also included below.
A couple of apologies: The responses are not intended to be condescending or rude, in any way. With limited time to type and answer the questions, we did our best to answer the questions in written form as quickly as possible. Apologies also for the late hour, we worked from the moment the meeting was over until this posting to answer every question.
Questions are in plain text; answers are in bold.
1. From Mike Bergman: I would like to know if option 1 is chosen what the detailed changes to our benefits would be?
The exact benefits changes are unknown at this time, but if the contribution is not increased, the fund would need to reduce benefits, raise premiums or make other alterations to ensure that liabilities do not outpace income.
2. From Paul Hutchins: what stock market crash? The Dow is only down around 500 points from 2 years ago today.
The Stock market did not “crash” but there have been losses that affect the plan. Currently pension consultants project an overall -6% loss for 2020 in this trust – with our current assumed rate of return this could result in a 13% loss for the fund.
3. From awfleck: How much do we currently have going to shore up to the old retirement?
We currently have $1.25 going to non-accrual. Other plans with stronger contributions to non-accrual are better able to weather downturns-stronger non-accrual contributions help create plan stability.
4. From Jeremy Paschich: I would like to know how many people are on pension benefits as we speak?
Currently we have 7,538 active retirees.
5. From IAN : I know that a lot of people are not happy with Aetna as a carrier. Me and my family aren’thappy cuz we have less coverage and pay more on our end. First Choice was great and i’m sure the trust switched carriers because it was “cheaper” we it is clear why it was cheaper. Now you want us to pay more for the same or less benefits. I would be fine with paying more with a carrier like First Choice but, I’m not ok with paying more to Aetna. On a side note, these zoom meetings should continue in the future. You will have a WAY higher turn out for ALL meetings.
Our plan (benefits provided) has not changed since switching to Aetna. What HAS changed is the service. We have had challenges with Aetna being too quick on the trigger for denying claims that they believe did not match the plan.
We took Aetna to task several months ago for the same concerns you are naming-we don’t want a cheaper price tag for a “cheap” product. They promised us stronger discounts to keep the plan healthy, while maintaining the same, if not better service than you are used to. We have been unhappy with a variety of these issues and have required correction of the problems we knew of.
While they have addressed many of the issues that we brought to them, we need to know what specific problems are occurring (and in what time period) so that we can accurately know what has been fixed, if not, why not, and if we truly do need a new provider. You will likely see a survey on benefits service coming out soon. And I agree, I enjoy answering questions, especially the tough ones. During local meetings and delegate meetings, we hold Q&A forums often. I hope to do more Q&A’s digitally.
6. From Jeremy Paschich : Also how many years are we in the black on are pension.
The pension fund is currently certified as a “Green Zone” plan as per the PPA (Pension Protection Act of 2006) Regulations and is projected to hit 100% funded in 2027, assuming that all current assumptions are met. However, if our contributions and investments are significantly affected, that status will reduce.
7. From Lee Carter: the values chosen in option 2 and 3, are these based on if the economy regrows or can we weather a larger slowdown?
The values offered in the options provided for the vote were established by the union then submitted to the Pension consultant in order to find the impact, to the best of our ability.
The details of the impacts of the contribution are all based on actuarial assumptions. The larger allocation in option 3 compared to option 2, would result in twice the impact, though we are advocating for Option 2 so that you can still get a raise on the check, along with benefits maintenance.
8. From james.thompson: do you anticipate legislation and or federal funding to help shore up our pension fund due to this pandemic ?
There is currently legislation being debated at the federal level. We have lobbyists advocating hard for our members locally and federally but we can’t wait for legislation that may or may not happen, particularly when we have a June 1st deadline.
We must do what we can to positively affect the future of your benefits. Legislation has not been historically positive for working people on pensions. There are many politicians who don’tbelieve you should even have a pension. We push hard against that, but the responsible path is to make decisions for your benefits with the information we have in front of us currently.
9. From Emmett Tullar : why dont offer a health plan where u dont have to meet a hr standard. i work in trade show and only work ave 750 to 850 yr and only get health care 5 to 7 mths yr and most of the time only get a half mth to see a doctor. i know this not extactly the topic. but thought i would ask.
The Western Washington Health Fund is operated under a dollar bank- hours worked are converted to dollars, paid to the Trust by the employer and are then accrued in a members account. When a participant has enough dollars in their account to “Pay” for a month of coverage, the coverage is provided.
The Trust would not be able to provide benefits, if they are not paid for. In a typical workplace that is not based on hours, you are provided benefits while you are working, after gaining eligibility, and cut off completely when you are not working. That is not realistic for the construction and tradeshow industry, which is why we have a bank structure.
We have explored possibilities to offer reduced coverage for lower hour earners. That may be something we can adopt in the future to provide some coverage, but it is not an easy fix.
10. From Aspen: Has there been a drop in use of the health plan since people have been asked to not do non-essential healthcare?
Yes, there has been a temporary decline in usage, but the costs that most impact our plan are large claims. Even with the shutdown, those essential services to cancer patients, premature births with birth defects andother high priced treatments have not reduced due to the Stay home Stay safe order.
Also, the benefit trust’s experience shows that when there is a reduction in usage in one time period, that doesn’t slow overall usage when the opportunity becomes available to get medical services. For example, when clinics open to non-essential services, our experience shows a large influx in benefits usage.
11. From Hans Lambert: I believe you should ask for this next year. Why can’t the union delegates make a better decision at contract time. This is poor leadership.
The Delegates do not Negotiate or ratify the Contract. The Bargaining Teams are made up of PNWRCC Staff and field carpenter members. Once an initial agreement is reached that agreement is offered to the members for ratification. Anything that is in this contract was chosen and voted for directly by our members.
12. From Dan: how many months do we have saved for health and wellness as of today.
The Carpenters Trust of Western Washington is currently operating with 4.1 months of unallocated reserves. That is roughly half of where we were at in 2017 and 2018. It is too low to responsibly promise full benefits in the future. It is crucial to have stronger reserves.
13. From Covid-19: are there actual numbers available for our plan that are accessible to members?
Details of the funds can be requested by any participant by contacting the Trust Office. The “Plan Booklet” is online at www.ctww.org
14. From Damien Villanueva: we have the worst vacation fund put more money to our vacation fund
The amount allocated to the Vacation account is subject to bargaining- if members would like to see an increase to the allocation it needs to be brought up prior to negotiations. That amount is simply a deduction from your negotiated wage. This current allocation request is regarding healthcare and pension. Negotiations for the WWA Master Agreement are open in 2021.
15. From derrick keene: what is the number of carpenters coming into retirement age?
Unfortunately, there’s no hard and fast number of “likely retirements.” It depends on when people want to retire. With the “80 and out” subsidy and the eligibility requirements affected it would take an in-depth report to give a simple answer. We are happy to do that reporting at a later date, but we are not able to provide that in time for the voting deadline tomorrow.
16. From Anita B Seattle : who does this contract affect? I was under the impression that it was a tradeshow contract. is that correct? also do we have one more year for this contract meaning will we have to do this again in 2021.
This affects the WWA master agreement, which has an impact on a number ofcontracts’ benefits, including tradeshow. We reevaluate allocations every year. The WWA Master Agreement is up for re-negotiation in 2021.
17. From Hans Lambert : Are you using scare tactics during a pandemic?
Nope. It’s a catch-22. Either we could ignore reality and cut benefits or we can tell the truth about what’s happening. We understand that it’s a tough time to have to look at benefits. We are taking a risk to tell you the truth in a time when people are scared. That can be unpopular and uncomfortable-It’s not ideal, but to be responsible we have to deal with this now, and tell you the truth during an uncomfortable time.
18. From smity425: So even with funds in savings we couldn’t have waited on the vote with being in the current contract to have had members and our UBC discuss voting instead of putting the vote out before all brothers and sisters could see numbers and have all info.
Correct. We would have to wait until next year, which will be one full year of reduced contributions, so we would be in a worse position a year down the road. That would be an irresponsible move for your benefits.
19. From Mike Bergman : if you can’t tell us what we would be in danger of losing how can you possibly tell us you need to shore things up?
We currently have reduced months in reserves in the health care plan as well as well as significant investment losses (both referenced above). That’s what we are losing financially. When we have less money to work with, we are not able to offer strong benefits.
20. From Covid-19: markets will recover, but with the increase in money allocated from workers, new members are now paying for two pensions. At what point do we decide to stop contributing to the legacy plan and focus on the new retirement?
We do not have 2 pensions that are separate-both designs fall into the same overall funding bucket. It is not legal to stop funding one design over the other, and if any retirees or members about to retire learned that we were abandoning their benefits they would (rightfully) revolt.
We have to take care of the promised benefits, while simultaneously structuring new benefits to be sustainable in the future for new members. For more information on how the plan works please go to https://www.nwcarpenters.org/for-members/pension-benefits-retirement/sibinfo/
21. From jeremiah fort: Ken referenced “long term” Long term investing takes into account the highs and lows. Why are we jumping to put more money in during a temporary low when that doesn’t support a long terminvesting strategy?
The desire to increase the contribution is not to “chase a market’ or be reactive to the current market, but to look at the long term and start now when we have a fair increase that could be allocated appropriately. A long-term investment strategy needs contributions. When we are low and projected to be lower, we must provide money to be invested.
22. From Covid-19 : new members seem to get a bit of the shaft.
Active participants pay into the fund to accrue benefits for themselves and to help secure benefits that have already been committed. Whether you agree with it or not, the funds that are in existence need to be funded and the only way to do that is through investment earnings and contributions.
My journeyman always told me “I need to teach you right so that you are paying into my benefits for many years to come.” That philosophy of mentoring is crucial for us to embrace- to create a lasting industry, a strong trade, and strong benefits.
23. From Dave Snay : Dave Snay local 129 in 09 We were told we would get the $1.25 back and we never did. Like Ken said we are in the 3rd year of this contract. We need to maintain things as they are. I feel that is owed to us that are working. With the $2.00 increase, we can stimulate the local economy and that will help us in the long run.
Thank you for that statement. Stimulating the economy is important but it will not have a direct and immediate impact on your benefits. Reduced contributions will have a lasting negative impact on benefits.
24. From John Gast : I think it would be beneficial to emphasize that the recommended option is in response to present conditions. As the economy improves more money can go to paychecks.
Thank you for that explanation. That is definitely themessage we are trying to convey.
25. From Yanneth Romero : is it true that we could pull all our 401k without paying 10%penalty?
Please contact the Trust fund for details and requirements for your account.
26. From Patrick Burns: Have you discussed nationalized health care? Shouldn’t the UBC support this politically? And make Biden bend if by some small chance he becomes 46.
The bigger picture of healthcare is always up for discussion and advocacy. At this moment we must deal with this plan and our members’ current benefits.
27. From Anita B Seattle: I recently purchased a healthcare plan. I have had multiple conversations with the trust about an extension because of covid we were forced not to work and provide hours into our hour bank and they keep saying that the commuter
Apologies-not able to answer or understand the question.
28. From Brian Bugg : How long can we hold our present situation without changing anything in our contract?/ is there a wait and see option to this problem?
If we do not address the immediate needs for the Health fund there will be modifications to the plan.
29. From Anita B Seattle : I’m sorry they keep saying that the committee has not been able to come up with a solution. have you heard anything regarding a solution from the trust committee.
Apologies,-not able to answer or understand the question. All presenters on the call were trustees.
30. From kyle A : How long would this change be for? one month one year three years?
There is currently 1 year left in the Western Washington Area Master Agreement, we will be in Negotiations in early 2021 where we will be discussing Terms, conditions, wages and benefits with the AGC of Washington. Agreements will be offered to the membership for ratification.
31. From Jade walsh : Does the trust advocate or and lobby for a Medicare for all system?
The Trust is restricted from doing any lobbying at the federal level. The UBC advocates for federal pension solutions that will best benefit our members.
32. From go4dill: Carpenter’s Unions in Chicago and New York (and other places) have been waiving dues for members while they have been forced out of work due to Covid-19. Why haven’t we?
Those Dues payments were made from a Labor Management fund. The PNWRCC does not have a similar fund that we are able to pull from. Many other councils have not been able to offer dues relief, due to Department of Labor restrictions, though we areactively exploring other options to relieve financially stressed Carpenter families.
33. From William Thomson: If option 1 were to pass, is it guaranteed that our premium will go up?
Detailed changes to the plan are unknown at this time but if expenses continue to outpace income adjustments to premiums, benefits modification will be made.
34. From Covid-19: sounds like whom ever is doing the investment needs to diversify better. who are we going through? who manages it and what’s their credentials?
Our investment Consultant is Callan LLC and we contract with and hire investment managers based on their recommendations. The Trustees actively monitor all managers and hireand fire based on performance when compared to their industry peers.
35. From RGBTOP : The vacation fund isnt a savings account though. it doesn’t earn interest.
Our Vacation funds are transferred to Qualstar Credit Union on monthly basis-members are welcome to automatically transfer that money into interest bearing accounts if they choose to do so. Some trust funds in our council only offer vacation payouts once or twice a year, so that option is not available to them, but members in this trust have full access to that option.
36. From Neil Stamp : What are the long term investments that the Trust is invested in?
For details on investments you can contact the Trust office at www.ctww.org
37. From Neil Stamp : Sounds like we are getting what we pay for out of the Calan investment advisors. Maybe having Fidelity or another actual investment company that makes money getting us good investments would be better.
Callan Investments is a highly respected firm nationally that has been serving the Carpenters Trust for many years. Their performance and fees are in line with other consulting firms we work with on other funds. We regularly review consultants to ensure that we are getting the best “bang for the buck.” That is an important part of fiduciary responsibility.
38. From smity425 : why are we in violation and who do we blame for that?
In regards to a “violation,” I will assume for this question we are referring to the Health and welfare policy on for reserves, but I’m not sure. The trustees have a goal to maintain 6 months reserves, and have been diligently working with consultants to stay on that track, which is why we are coming to the membership for an increase to the Health and welfare contribution. The only way to increase reserves is to either increase contributions or reduce benefits.
39. From Aspen : Can we have a fund carpenters put into as individuals to help other carpenters with dues- a pass the hat of sorts?
Hardship funds of many kinds can be pursued through the locals, but we always advise legal review of any adjustment to dues structures/payment.
40. From Brian Bugg : How many other unions are having this same issue?
We know anecdotally that many other trades are making adjustments on an annual basis as well as during COVID-19. We don’t have a current number. That will take months to gather, and will be incomplete since it is private information, and would need to be provided voluntarily by hundreds of funds.
41. From RGBTOP : Is the optional 401k fund managed by the same firm as our trust? If not, is that possible so that we have more money to leverage?
The 401k/Individual account is invested in the same pool of assets and we actually get considerable discounts in fees because of that investing relationship.
42. From John Beavers: we all like having money on the check but if we wanted option 3 would this put us out in front ? so we would not have to ever have to do this again ? I’m all for helping put money away for the Long haul ?
More money into pension will help funding, but we need to be diligent in being responsive to our funds and make sure we are assessing our progress annually, not just every 3 years. We feel that option 2 provides the opportunity to shore up benefits our members expect as well as providing cash on the check.
43. From derrick keene: how will the results from this vote be provided to the members?
The results will be pulled at 9am tomorrow and posted on the Council Website and on Facebook shortly after.
44. From Hans Lambert : Hopefully there is proof to the fact that other unions are less funded.
Hundreds of funds are struggling and have been struggling for many years for various reasons. When a fund becomes insolvent (runs out of money) the Pension Benefit Guarantee Corporation (PBGC) takes over the plan and the participants receive cents on the dollar of the benefit they earned.
Because of so many pensions going under(insolvent) these past few years, the PBGC is slated to run out of money in 2023. The Carpenters Trust of Western Washington is a generally healthy fund and we want to keep it that way. Providing a boost to the funds will allow us to keep it healthy.