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Benefits December 4, 2002
NC Steelworkers OK 401(k)
December 4, 2002 (PLANSPONSOR.com) - A group of
union workers at Dave Steel Co. have left the picket lines -
and accepted a contract deal that includes replacing their
pension plan with a 401(k).
Reported by Nevin E. Adams
Members of Shopmen’s Local 812 of the International Association of Bridge, Structural, Ornamental and Reinforcing Iron Workers went on strike November 22 over the company’s plan to cease contributions to a union pension plan and replace it with a 401(k) plan (see Steelworkers Walk Out on 401(k) ). They returned to work yesterday, according to the Asheville Citizen-Times.
Guaranteed Preference
The 56 union members had initially expressed concerns about the risks inherent in 401(k) investments, saying they preferred the security of a guaranteed pension.
According to the Citizen-Times report, Edward Cottongim, an organizer for the union, “We (the union) would not have recommended that they get out of the pension plan, but it was completely up to the local members. They had been out (on strike) for a week and didn’t want to be out any longer. They felt like they took the lesser of two evils.”
The company said the union pension fund puts the firm at a competitive disadvantage in recruiting employees since employees must work at the company five years before they are eligible for benefits.
The company also has 34 nonunion office workers.