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Pension Fund to Sue over Philly Orchestra’s New CBA

October 18, 2011 (PLANSPONSOR.com) - The Philadelphia Orchestra said a new collective bargaining agreement has been reached between the orchestra association and its musicians union.

By Rebecca Moore editors@plansponsor.com | October 18, 2011

According to the Boston Globe, orchestra president and chief executive officer Allison Vulgamore said the agreement calls for cutting salaries and moving musicians' pensions to a defined contribution plan from the current defined benefit plans.  

However, in a statement, the American Federation of Musicians and Employers Pension Fund said the agreement is the culmination of a strategy to avoid its obligation to pay the fund contributions of up to $35 million it owes for benefits earned by its musicians.  

"The Philadelphia Orchestra Association has taken advantage of the legal process and arranged its finances in a way that damages the pension benefits of musicians across the country," said Raymond Hair, co-chair of the fund, and President of the American Federation of Musicians, in the statement. "From the outset, the Association has distorted aspects of its financial condition so that it could eliminate its obligations to pay for pension benefits that were already earned."  

Hair said that the Association's leaders had presented a skewed version of its true financial condition to their own employees, their donors, and the Bankruptcy Court (see Philly Orchestra Challenged on Funding Pension).  

Alan Raphael, co-chair of the fund, said that in light of the trustees' responsibility under federal pension law, the fund currently sees no alternative to litigation to protect the interests of all of its participating musicians, both in Philadelphia and all over the country.

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