More reasons besides low wages why voting ‘NO’ on Prop A on Aug. 7 is critical

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Your pensions, health and welfare, training and vacation funds are all at risk

HALL

By SHERRIE HALL

Union members need to be aware of the potential for other major losses besides wages should the Proposition A “right-to-work” law (RTW) pass August 7 —the loss, or great reduction, of your UNION BENEFITS.

The seldom-understood fact is that multi-employer union benefits — health and welfare, pensions, training and vacation funds — depend on the strength, and size, of your union and your union employers. I’d like to shed some light on these less considered issues.

HEALTH & WELFARE FUNDS

Health care costs keep increasing. A sound Health and Welfare Fund protects you from steep or unexpected increases. RTW will jeopardize this.

Under RTW there will be a growth of non-union employers, either by current employers shedding a weakened union (the real goal of RTW) or new employers coming here looking for cheap labor.

If the number of participating employers decreases because RTW becomes law, Welfare Funds will lose the advantage of costing less overall because they are serving such a large group; it’s called “economy of scale.” It costs more per person to administer a smaller fund than it does for a larger fund.

Smaller funds mean fewer dollars to pay benefits.

For example, a catastrophic illness or injury has a far greater financial impact on a small Welfare Fund than on a large one. Thus, the small fund has to retain a larger financial reserve – money that can’t be used directly for benefits but is used as a form of insurance to keep the fund afloat.

As RTW decreases the size of the group being served, the Welfare Fund trustees will have to make difficult choices: reduce or eliminate benefits or ask you to pay more out of your own pocket.

Many of you are eligible for low cost coverage after retirement through a Welfare Fund. Only a healthy Fund can offer retirees health benefits. Retiree coverage will likely be one of the first victims if Missouri affirms RTW.

YOUR PENSION

RTW threatens the financial stability of your pension plan – especially if it is a Defined Benefit Plan that guarantees you a fixed income for life.

As most pension plans are joint-employer plans, in which many different employers contribute, if there’s a reduction in the number of union companies, as will be the case overall with RTW, there will be a reduction of funding for the pension plan, putting the plan under greater stress.

At that point, the fund trustees again would have to make the difficult decision of reducing future pension benefits.

The stronger unions are, the stronger everyone’s pension plan is.

TRAINING FUNDS

Training both for new apprentices and experienced journeymen is vital today as so many things in your industry change so quickly. Training funds (apprenticeships) too will be severely impacted by RTW.

As with the other benefits discussed, a training fund is able to offer a breadth of courses, highly skilled faculty and first-class facilities because it has pooled the resources of so many employers and the contributions on behalf of so many participants.

If the employer density and contribution bases decrease due to RTW, and they will, the scope and effectiveness of your training center will be diminished and potentially eliminated. That indeed will have an impact on your future!

Training is crucial to your future and your ability to support your family.

Training offers many opportunities to advance in your industry, which in turn allows you to stay gainfully employed even when seasonal opportunities dry up. And ultimately training allows you to earn a higher rate for specialty work.

Training sets you apart and makes you highly sought after, both individually and collectively as a productive, cost-effective workforce that gives your employer an upper hand when bidding for new jobs.

VACATION FUNDS

In the construction industry, most non-management employees are not entitled to paid vacation time UNLESS they have a union Vacation Fund.

The more workers in the Fund, the more employers paying into the Fund, the more dollars are available to cover administrative expenses to keep the Fund stable.

Applying the economies of scale principle, your Vacation Fund and your paid time off are also in jeopardy if RTW becomes the law in Missouri.

BOTTOM LINE

“Right-to-work” states weaken unions; and weak unions mean far less ability to negotiate, and financially support, strong fringe benefits.

These are just a few other reasons you may not have considered in understanding that more is at stake in voting NO on Proposition A than simply lower wages.

As many articles in the Labor Tribune have proven, the so-called “right-to-work” is not a right to anything; it is a personal punishment for all workers regardless of union membership and it further threatens the already-embattled middle-class.

“Right-to-work” is wrong for Missouri now and forever. Vote NO!

(Sherrie Hall is an attorney with the respected labor law firm of Hammond and Shinners. She and the firm represent many unions and union-related funds.)

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