Biden releasing nearly $36B to aid pensions of union workers

President Joe Biden’s administration on Thursday announced the infusion of nearly $36 billion to shore up a financially troubled union pension plan, preventing severe cuts to the retirement incomes of about 350,000 Teamster workers and retirees across the United States.

“It’s about everything you worked for,” Biden said, with union officials standing behind him. “It’s about finding a dignified retirement.” The money for the Central States Pension Fund is the largest amount of federal aid provided for a pension plan, the Biden administration said. It comes from the American Rescue Plan, a $1.9 trillion coronavirus relief package that he signed into law in 2021.

“This matters,” Biden said. “This matters for workers ... This matters for their spouses, this matters for their mothers and fathers who they’re taking care of ... It matters for the country.”

Many union retirement plans have experienced financial pressure because of underfunding and other issues. Without the federal assistance, Teamster members could have seen their benefits reduced by an average of 60% starting within a couple of years. “Union workers and their families are finally able to breathe a huge sigh of relief, knowing that their hardearned retirement savings have been rescued from steep cuts,” said Lisa Gomez, assistant labor secretary for employee benefits security.

While bargaining for contracts in past years, union members chose to forgo raises and other benefits on the assumption they would would have “a prosperous retirement,” Teamsters General President Sean M. O’Brien said in a written statement. But when the retirement fund faltered, union members turned to lobbying the federal government for help.