Union Reps and Employers
Click on any question below that interests you to reveal the answer:
As an employer, why should I give up the control and flexibility I have with my current pension plan?
Many employers prefer to keep control of their company's pension plan so they can opt to fund the plans on a year-by-year basis. Obviously, during strong investment periods it may not be necessary to contribute to your plan. But, this short-term flexibility can lead to greater pension costs for your company over the long haul. Your contributions to the National Pension Plan are fixed and predictable over the life of the contract, protecting you from the potential volatility of year-by-year funding. Making steady contributions to the Fund is likely to represent better value—for you and your employees. You can focus on your business, comfortable in the knowledge that we are handling your pension-related matters—and handling them well.
My advisors say the National Pension Plan is a bad idea!
We are always glad to address employers' concerns about the Fund. We welcome the chance to respond to questions from the professionals who serve you. We want to make sure there are no misconceptions about our plan. We have a track record of providing solid benefits, often better than those a single-employer plan can provide. When you compare our costs and benefits, you will see that the National Pension Plan is a good proposition.
As an employer, why should I switch to the National Pension Plan when we already administer a company pension plan?
Two reasons to switch to the National Pension Plan are that we offer secure lifetime retirement benefits and we administer the plan for you. Employers who adopt the National Pension Plan after terminating their own plans or by merging their plans into the National Pension Plan will find we can save them time and money. For example, if you have the IAM National Pension Fund as your sole pension provider, you don't have to worry about regulatory compliance. You can focus on your business, comfortable in the knowledge that we are handling your pension-related matters—and handling them well.
As an employer, why would I get involved with a union-affiliated pension plan?
The Fund exists to provide pension benefits to IAM members, but the Fund is legally independent from the union. It is a separate entity managed by an active Board of Trustees composed of members of both labor and management. Employers have an equally strong vote in the Fund’s management.
Our trustees set policy and investment strategy. That strategy is based on thorough research and analysis and expert advice from some of the most trusted names on Wall Street and nationwide. The IAM National Pension Fund has a sound investment approach and a record of more than 50 years of unblemished integrity.
Why not give workers the flexibility of a defined contribution or 401(k) plan?
We recognize the value of a 401(k) plan as a supplement to a defined benefit pension plan like the National Pension Plan. Our own IAM National 401(k) Plan is evidence of that. But, unlike a 401(k) plan, the secure benefits provided by the National Pension Plan can't be used for any purpose other than retirement. With the National Pension Plan, the money is there for retirement, no matter what, for life.
401(k) balances are exposed to market fluctuations, as recent years have made painfully clear. Workers may borrow from 401(k) accounts or cash them out when they change jobs. In fact, a large percentage of 401(k) plans have loans outstanding, and huge numbers of 401(k) participants cash out when they change jobs. For workers, a secure defined benefit like ours can take the worry out of long-term financial planning.
Will any employees lose their existing vested benefits in my company plan if I switch to the IAM National Pension Fund?
An employee's vested benefits belong to the employee—that's what vesting means. When a company becomes a contributing employer to the IAM National Pension Fund, its employees' status as participants in the National Pension Plan has no impact on vested benefits in the company's own plan. And, vesting service in the company plan counts in the National Pension Plan for vesting and some eligibility purposes.