After nearly four years of negotiating the future of the Local I-60’s defined benefit pension plan, the bargaining teams of the Local I-60 and American Medical Response have reached an agreement which replaces the defined benefit pension plan with an improved 401k matching contribution plan.
Under the new agreement, members of the Local I-60 will continue accruing vesting service time under the pension plan indefinitely throughout their employment, however benefit accruals will freeze as of June 30th, 2016. Employees who reach twenty years with the Company even after the plan is frozen will still be eligible to retire and receive benefits as a fully vested retiree.
On July 1st, 2016, all employees hired before March 1st, 2016 shall begin receiving an employer contribution match to their 401k from AMR dollar for dollar up to 7% of their gross wages. This is well above and beyond the standard 401k match of AMR and Envision Healthcare of fifty cents on the dollar up to 6% of wages.
The contribution match will be tiered dependent on service time with the Company. Employees with less than 5 years of service will receive 5% dollar for dollar match. Those with more than 5 years of service will receive a 6% dollar for dollar match until reaching 10 years of service. Those with 10 years or more of service will receive a 7% dollar for dollar match.
Having dollar-for-dollar contributions to the 401k allows our members to have access to their retirement funds via a hardship withdrawal or personal loan, something not available with a defined benefit pension plan. The 401k also provides portability, as members can move it to a new employer’s plan should they change jobs, or roll it into an IRA or other investment accounts. While the pension is no doubt important to many members, the Local I-60’s workforce is comprised mainly of portable or transient workers – those who only stay for 1 – 3 years, and rarely meet 5 years of service.
This change from a pension plan to a 401k plan will benefit hundreds of members who would otherwise see no benefit from the pension plan which requires five years of service to become vested.
The above agreement will be incorporated into the collective bargaining agreement which is anticipated to be finalized in early to mid April, 2016.