Original URL: http://www.theregister.co.uk/2006/01/13/verizon_pensions/

Union website hits back at Verizon pension freeze

'A chilling signal' for all workers

By Tim Richardson

Posted in CIO, 13th January 2006 15:26 GMT

Workers at Verizon are being urged to visit a newly created website as part of a campaign to get the US telco to overturn its decision to freeze pensions for thousands of employees.

The Communications Workers of America (CWA), along with the Pension Rights Center, is hoping workers affected by Verizon's decision will use the site to voice their concerns.

From the end of June, Verizon plans to freeze all pensions of management and non-represented workers, although union-represented workers will continue to be covered by an on-going pension plan.

CWA president, Larry Cohen, called Verizon's action "a chilling signal, not just for current workers who have lost their retirement security, but to the future generation of workers who will be penalized before they ever start their first job".

He said that workers were paying the price of companies' bad business decisions and "corporate lawbreakers". He noted that in the US, employees are increasingly required to "bear the costs and the risks for their retirement and healthcare security".

The giant telco - which has just absorbed MCI - announced the changes in December, saying it would provide Verizon with a "more affordable benefit-cost structure" and that the changes were in "line with current trends".

Those "current trends" are the increasing number of companies freezing their existing pension schemes because they're too costly to run.

Earlier this month, IBM became the latest corporate giant to join the trend, announcing that from January 2008, it plans to scrap its final salary scheme for everyone at Big Blue - including executives. Instead, the computer giant will contribute only to employees' own private 401(K) pension plans. ®