Screwing the Retirees:
A List of Shame

May 4, 2009

In the 2007 UAW contracts, Chrysler, Ford and GM refused the promises they had made during 57 years to pay for retiree health care and instead set up VEBAs to be run by the union. Chrysler agreed to add 10.3 billion dollars to the existing VEBA, which had 3.75 billion–coming to a total of 14.1 billion dollars to be turned over to the new VEBA. And even that was estimated to be less than half the money the VEBA needed to guarantee future retiree health care.

Now Chrysler is dumping retiree health care onto the VEBA this coming January–instead of starting in 2012. And it is providing only 1.5 billion dollars immediately, perhaps less–with promises to pay another four billion, if you believe that, and a bunch of completely worthless Chrysler stock, which has no way to be valued, since it’s never been sold anywhere.

In other words, they have ripped the VEBA to shreds. And that guarantees that retirees will have to pay much more and their benefits will be cut.

The cuts and increases have already begun.

• On July 1 this year, Chrysler retirees will lose both dental and vision coverage.

• Prescription co-pays will be doubled or even tripled.

• Retirees and surviving spouses with pensions and Social Security totaling less than $8,000 per year will now have to pay monthly premiums.

• Retirees who could afford only Catastrophic Coverage now have to join the regular plan and pay monthly premiums, as well as co-pays and deductibles.

• Retirees will have to pay $100 for Emergency Room visits.

• Pensions will be reduced by $76.20 per month for Medicare-eligible retirees (age 65 and over).

• Starting January 1, 2010, the VEBA Committee can eliminate or reduce all other benefits and increase all other payments for retirees.

It comes as no surprise that big companies are ready to throw you away as soon as they use up your labor.

But what can be said about a union leadership that would have us honor our elders by dumping them?