From:                              Pam Nichols [pamela.nichols@dsea.org]

Sent:                               Friday, May 28, 2010 10:41 AM

To:                                   Nichols, Pamela [DE]

Subject:                          Test: Two-Tiered Pension and Health Plans dangerous to your benefits

 

 

YOUR FUTURE

YOUR VOICE

YOUR ASSOCIATION

YOUR REWARD

DSEA

every member matters at DSEA


• YOUR REWARD •


• FROM THE PRESIDENT •

 

Do you like to play golf?
Even if you're not Arnold Palmer, we urge you to join us on June 18 for the annual DSEA Future Teacher Benefit Golf Tournament. 
The deadline to sign up is June 15.
This year's scholarship winner, Jason Buchler of Indian River High School, will receive $4,000 - that's how successful this benefit tournament is. Join the fun!

It’s summertime!
Theme Park discount information coming in every day
Check out updated information about discounted theme park tickets and other summer time fun on the DSEA Discount List page.

Log in at the DSEA web page  and then click on Discount List from the left-hand column.

 

Treating everyone fairly is a bedrock union position
 by Diane Donohue, president, DSEA 

The Markell Administration is proposing changing our current health care and pension systems by adding additional "tiers," i.e., keeping the current system for current employees, and adding another system which would cost future employees much more, for the same level of health care benefits. The pension system would not only require more buy-in from future employees but require them to work longer. 

We cannot stand by and allow two-tiered plans to happen. As one union leader from our State Workers United Coalition said recently, “If we approve this, we’re condemning our children and grandchildren who choose to work for the state, to have less than we have. Why would we want less for them? This is not the legacy I want to pass on to my kids and grand-kids.”
“Selling out the unborn” is how another state union official put it.
 

 

• YOUR BENEFITS •

The best way to protect your current benefits is to oppose two-tiered plans

DSEA and the Coalition of State Workers United for a Better Delaware, to which we belong, is opposing a plan by the Markell Administration to convince the General Assembly to require new state workers hired after January 1 of next year to pay more – a whole lot more - than current employees in order to obtain the same health care benefits; and pay more into the pension system, as well as require them to work longer in order to receive that same pension.

While the health benefits themselves would not change - at this time - under the Administration’s plan, new employees would be paying more than 100% more than current employees for the same health care coverage!

A state employee making $20,000/year would have to pay 19.32% of their salary, $3,864/year, in order to have the First State Basic Family Plan.

Consider a newly hired paraprofessional who makes $17,228 per year. Under the Markell proposal if this para wants to insure her family, she will pay $322.07 every month. Let us be honest: that para will not insure her family, and those kids will either go without health care or be forced to utilize Medicaid. Is that a proud moment for the First State, her own public servants on public assistance?

For pensions, the administration would like new employees to pay 4.5% of their salary into the pension system. Currently, you pay 3% of your salary after earning your first $6,000.

So, a new hire earning $30,000 who elects to enroll in family coverage will decrease their take-home pay by a total of $4,494, thanks to increases in health care and pension contributions.

This equals a 15% reduction in pay!

As their contributions increase, the state's contribution - under this proposal - will decrease. For a new hire’s monthly premium, the state's contribution would decline from 88%/single, 87% family to 74% single and 66% family. In Maryland, the state contributes 80% of the cost of family coverage; Pennsylvania, 93%; New Jersey 97%; and in Virginia, 89%.

 

YOUR FUTURE

“You’re telling me that my health care benefits and pension won’t change. What's wrong with that?”

Why do you have the health care and a pension benefits you have today?
What if your senior colleagues had decided to trade away your benefits for their own short-term gain?
What if you could not afford health care for yourself or your children?

You have health care and pension today because educators before you fought for them, lobbied for them, even went on strike for them. Would you be willing to do the same? Would you fight for a younger colleague, a son, daughter, niece, nephew, who will decide to teach in the near future?
Perhaps our history teachers will remember the words of Benjamin Franklin, “We shall all hang together, or assuredly we will all hang separately.”
 
• What will happen to collegiality and collaboration when the person working next to you can’t afford to see a doctor, but they know you have a full benefit package?
• How will your union be an effective voice for your rights when solidarity has been destroyed?
• It doesn’t take long for the benefits of current employees to be affected.

Yes, that’s right. In a few years, the numbers of current employees will dwindle - through retirement and resignation - and the numbers of employees hired after January 1, 2011 will grow. As new employees begin to number more and more, they will ask why we let this happen, and demand from DSEA that we fight for equal benefits. History has shown that legislators will work to make everyone happy by compromising: bringing up the benefits of the “new” employees and reducing the benefits of the older employees.
So yes, you will be affected.


The best way to protect your current benefits is to oppose two-tiered plans.
We DO support working to find savings in health care.

We are willing and eager to work with state officials on finding savings in health care but will not be boxed in to finding them only through two-tiered plans. Nor do we understand why the Administration is proposing such draconian measures: health care premium payments that are more than twice what current employees pay for the same health care; and more pension payments with fewer retirement options.

In addition, we still insist, as does the Coalition, that we all need to know how Delaware’s insurance rates are set – basic information – before we can work on where costs can be saved. Since last year, we have asked for this information so that we can relate rates to claims history to premiums, and we are consistantly told that this information is not available. How can that be? No answer. As a result, we have no assurance that rates are set accurately.   

 

• YOUR FUTURE •

Yes, Delaware's Pension Plan is fully funded

There is no economic reason to change the state's pension system, as the Markell Administration is trying to do for new state employees. It is well-funded and does extremely well in its investments. The state has no reason to "fix it" because it is not broken.

For us, and the members of State Workers United for a Better Delaware, there is no economic reason to require new state employees to contribute more and work longer to be eligible for a state pension. 

This week, a reporter from WDEL 1150-AM radio led a news story about the Governor’s proposals with a completely false statement that “Delaware’s pension system is underfunded by $1 trillion.” When questioned, she said it came from the Governor’s e-mail to all state employees. When she read it again, she noticed that it said that nationwide, state pension systems are underfunded by $1 trillion. And, in fact the Governor noted in his message to you that, "In Delaware, our pension plan for state employees is one of the better funded in the country." She is changing her lead.

The real test of the health of the state's finances, including its pension fund, is to look at the state's bond rating. An unfunded pension system would seriously affect that rating, which saves the state millions of dollars each year if it is good, and it is AAA, Triple A.

The pension system is not broken: it does not need to be fixed.

CALL TO ACTION
The General Assembly reconvenes next Tuesday, June 1. Join our Coalition members in lobbying your legislators, both Representatives and Senators.

Tell them that the pension system is healthy, well-funded and does not need to be "fixed."

And that two-tiered health care systems are unfair; create severe morale problems in the workplace; will not attract the best workers to state government. In addition, the Administration's current proposal will drive many new state employees onto the Medicaid roles who cannot afford losing so much of their pay, adding cost to the state, not savings.

For a complete contact list of state legislators, click here.

 

• YOUR PROFESSION •

Full-time teachers who began teaching in Delaware in the fall of 2007 or later: Please complete working conditions survey by June 7

Chance to win $50 gift certificate from Amazon

To improve the reliability of the data collected and to entice you further, the University is awarding a $50 Amazon.com gift certificate to three randomly selected teachers who have completed the new teacher working conditions survey. 
Just log onto the DEEDS website. Then under "What Can I Do Today?", click on "Take Survey." Then click on "Delaware Teacher Survey."

Thank you!

 

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Delaware State Education Association
136 E. Water Street • Dover, DE 19901 • tel 1-866-734-5834 • fax 302-674-8499