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NWB 'Guardian' OCT 06

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NWB 'Guardian' OCT 06 THERETIREE GUARDIAN NEWSLETTER OF THE ASSOCIATION OF U S WEST RETIREES News from Association members in all 14 U S WEST/Qwest states 2006 ISSUE 3 www.uswestretiree.org www.qwestretiree.org “YOUR PENSION DEATH BENEFIT ON TRIAL!” CHAIRMAN’S LETTER Qwest’s intention to cancel our ruling, it has become necessary to Pension Death Benefit has become gather documents, take depositions our most important challenge. from witnesses including former and This threat also brings a big current Employee Benefit Committee increase in our legal expenses. members, cover administrative travel In September of 2003 the Associ- costs for our attorney Curtis Kennedy, ation of U S WEST Retirees Board and hire an expert witness to go over members met with Qwest representa- the reams of paper work that have tives who presented a dated letter been gathered concerning our Pension announcing the cancellation of the Death Benefit. Pension Death Benefit. After some In the last issue of the Retiree heated debate, the company agreed to Guardian, Phyllis Kielblock and John hold the letter. The officers of Dick Johnson O’Brien reported on the history of our AUSWR have asked the company to Litigation Fund, and on the need to withdraw the letter permanently, and agree the reinstate the Litigation Fund because of these legal Pension Death Benefit is an earned benefit and is expenses to protect our earned benefits. protected by the Employee Retirement Income AUSWR has hired an expert witness, Leonard Security Act (ERISA) and cannot be cancelled. Garofolo. He comes with excellent qualifications. To date, the company has declined to reverse From 1983 to 1998 Mr. Garofolo served as the their intention to cancel the Pension Death Benefit. Regional Director of the US Department of Labor’s As a result, AUSWR has filed suit in Denver Federal Pension and Welfare Benefits Administration. He District Court to protect our rights to the Pension was responsible for enforcing Title I of the Employee Death Benefit. Your Pension Death Benefit is equal Retirement Income Security Act of 1974 (ERISA). to one year’s pay at the time of your retirement from During his 15 year tenure as Regional Director, the telephone company, if at the time of your death, he initiated thousands of employee benefit plan you have a qualified dependent beneficiary. investigations. These investigations involved the A non-jury trial will be held in January, 2007. application of ERISA’s fiduciary standards, the In order to make a strong case for a positive (continued on page 2) INSIDE 2 3 7 8 10 12 19 President’s Hidden A View From 12-Step Nacchio Legal Grassroots Letter Burden Washington Program Aids Watch Activities Network Recovery WE WERE THE OPERATORS AND REPAIR CLERKS, THE INSTALLERS AND TECHNICIANS, THE ENGINEERS AND NETWORK PLANNERS, THE CRAFT AND MANAGEMENT EMPLOYEES OF EVERY DESCRIPTION WHO BROUGHT TELECOMMUNICATIONS TO THE HOMES, BUSINESSES, AND INSTITUTIONS OF 14 STATES. NOW WE ARE UNITED IN OUR COMMITMENT TO PRESERVE AND ENHANCE THE RETIREMENT BENEFITS PROMISED TO US AND TO THOSE WHO FOLLOW US AS TODAY’S ACTIVE EMPLOYEES. RETIREE ASSOCIATION PRESIDENT’S MESSAGE PRESIDENT’S LETTER Dear Fellow Retirees, pension reform and funding to The season of politicking has excessive executive compensation once again rolled around prior to and disclosure, to Health Care the November elections. Through reform and spiraling health care our continuous involvement in the costs. National Retiree Legislative Go hear your candidates speak Network (NRLN), we work with and ask them questions about their the Washington D.C. staff to raise positions on issues that will affect awareness and to lobby for or the quality of life for retirees for against bills affecting retirees. We decades to come. Ask them how continually remind the members of they voted on particular bills, and Congress and their staffs about the why they voted that way. Ask who thousands of voters that make up contributes to their campaign and the ranks of our Associations. The Mimi M. Hull does that make them beholden to results of NRLN are well special interest groups. And then, documented in the e-mails and newsletters of when you have cut through all of the rhetoric, spin AUSWR, and you have often responded to our and doublespeak, please do what every loyal requests to e-mail, write a letter or call your American should be doing – that is, VOTE! legislators about a particular bill. And please vote as an informed voter who has But now it is time for the members of Congress tested the candidates and knows where they stand and other candidates for elected offices to hear on the issues. This election will be pivotal for the directly from you, face to face, about issues that are quality of life for seniors. It is in your hands. Thank important to you as retirees. Please take part in the you. national debate on issues from Social Security to Mimi Hull, President income indexed Medicare Part B Premiums, from Association of U S WEST Retirees “YOUR PENSION DEATH BENEFIT ON TRIAL!” (continued from page 1) review and interpretation of plan documents, and the five-state area, which is 36.3% of the total implementations of remedies where ERISA viola- membership in the 14-state area of AUSWR. A letter tions were uncovered. is being prepared to be sent to every member to In 1999 Mr. Garofolo founded ERISA Consult- request a donation to the Litigation Fund and where to ing Group to provide consulting services to attorneys send your check. If you would like more detailed on legal actions brought under ERISA. He also information, go to our website www.uswestretiree.org provides expert advice and consultation to employee or www.qwestretiree.org then to legal developments pension and benefit plan officials on ERISA then to pension death benefit litigation, then to July 3, regulatory and compliance issues. 2006 Expert Opinion Report by Leonard Garofolo. After considering what had to be accomplished The total report is 102 pages long and you can read all to put this case together, the AUSWR Board of his report or just parts of the document. authorized a 14-state drive to raise $200,000 for the Look for the Litigation Fund letter in your U.S. Litigation Fund. The NWB-USW-Qwest Retiree mail box! Association’s share is $72,600. Our share is In Unity, Dick Johnson, Chairman determined by how many members we have in the NWB-U S WEST-Qwest Retiree Assocation To date, the company has declined to reverse their intention to cancel the Pension Death Benefit. Retiree Guardian – 2006 Issue 32 IA/MN/NE/ND/SD Edition HIDDEN BURDEN -- AS WORKERS’PENSIONS WITHER, THOSE FOR EXECUTIVES FLOURISH -- Are “working stiffs” [and retirees] picking up the tab for posh executive retirement benefits? That’s the bottom line question developed in a recent executive pension plan report in the Wall Street Journal. [June 23, 2006, by Ellen E. Schultz and Theo Francis]. Excepts of their investigative report follows. AT&T 189,000 regular employees. David Dorman was chief executive of AT&T AT&T’s controller, John Stephens, confirmed Corp. from 2002 until its merger with SBC that executive pensions cause a bigger drag on Communications in November. He left in January. earnings, per dollar of liability, than pensions for His total of five years at AT&T earned him a yearly others. He added that AT&T, like some other pension of $2.1 million. That will replace 60% of companies, has informally earmarked an his annual salary and bonus in his final three years. undisclosed amount of assets for paying executive By contrast, former AT&T accountant Ralph pensions in the future. But while these assets earn Colotti’s $28,800 annual pension replaces 33% of investment returns, they don’t lower pension his final pay. He was at the company for 33 years. expense, because the assets aren’t irrevocably Mr. Colotti’s pension was held down by a dedicated to this purpose. The executive pension change AT&T made in 1998 in the formula used to plan, in other words, isn’t funded. calculate pensions. The switch had the effect of freezing pension growth for older workers like him. Lucent Retirees The 55-year-old now works at another company Lucent Technologies Inc. has pointed to retiree with a pension plan. “Working here another 10 years benefits as a burden and has cut benefits in a won’t make up for what my old pension would have number of ways. For instance, for various retirees in been” without AT&T’s change in formula, he said. recent years, Lucent has used a less-generous AT&T described its retirement benefits as pension formula; eliminated dental and spousal excellent and said a pension on the scale of Mr. medical coverage and death benefits; and raised Colotti’s is good in the telecommunications retiree health-insurance premiums. In a recent industry. Mr. Dorman’s richer deal is “reasonable, filing, the Murray Hill, NJ telecom-equipment firm customary and comparable to what similarly sized said, “Lucent’s pension and postretirement benefits companies offer,” AT&T said. A spokeswoman plans are large...and also costly.” noted that “in any industry, senior executives are Yet the pension plans for regular Lucent almost always provided with enhanced levels of employees and retirees, who number about benefits as a way to recruit and retain the best talent 230,000, are overfunded. In fact, they’re so full of and the best leadership possible to lead the cash that the investment return on their assets not company.” only erases the pension plan’s expense - it adds to At AT&T Inc., the pension liability for earnings.
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