CINCINNATI, Dec. 13, 2017 /PRNewswire/ -- The Kroger Co. and
International Brotherhood of Teamsters announced today the
ratification of a new labor agreement that provides for Kroger's
withdrawal from the Central States Pension Fund. The new labor
agreement covers associates represented by the IBT at three
distribution centers and two dairy manufacturing facilities
operated by Kroger.
Kroger and IBT have been working together for several years on a
plan to protect the pensions of Kroger associates at these
facilities, who are participants in the Central States Pension
Fund. The Central States Pension Fund projects it will go
insolvent in 2025.
Kroger and IBT have established a new fund, called the
International Brotherhood of Teamsters Consolidated Pension Fund
that is designed to provide Kroger associates with a secure
pension.
Included in this agreement are current Kroger associates/IBT
members working at facilities in Hutchinson and Goddard, KS; Houston, TX; Memphis, TN; Indianapolis, IN; and Livonia, MI. The
total number of active associates covered is about 1,800. In
February, Roundy's associates working at a distribution center in
Oconomowoc, WI ratified the same
agreement.
Kroger's withdrawal from Central States Pension Fund is
effective December 10, 2017.
Kroger's withdrawal does not require the approval of Central
States. Kroger will make payments to Central States to fulfill its
withdrawal liability obligation.
Under the ratified agreement, the benefits current associates
have earned as participants of Central States will be protected.
Here's how –
- The new IBT pension fund will make up benefits that are reduced
by Central States as a result of Kroger's withdrawal.
- Should Central States become insolvent and benefits are
reduced, the IBT Consolidated Pension Fund will restore benefit
reductions above the level guaranteed by the Pension Benefit
Guaranty Corporation (PBGC).
Moving forward, current associates also will begin earning a new
pension benefit through a formula negotiated by Kroger and the IBT
and ratified by members.
"Given the uncertain future of Central States and the potential
adverse impact on our members, the National Committee felt the move
to the IBT Consolidated Plan will ensure they have a stable
and reliable retirement benefit in the future," said Steve Vairma, International Brotherhood of
Teamsters Vice President."
"This is a good agreement for our current associates and our
company. It provides our current associates security for their
future retirement and the company financial certainty regarding
this important investment in our associates," said Mike Schlotman, Kroger's Executive Vice
President and Chief Financial Officer.
In 2015, the Company and the IBT negotiated, and members
ratified, an agreement that would have transferred Kroger
associates and retirees from Central States to the new IBT fund.
This transfer required the approval of Central States. The
Central States Trustees have not agreed to the transfer. This led
Kroger and the IBT to negotiate an agreement providing for Kroger's
withdrawal from Central States, while preserving the possibility of
a transfer.
About IBT
Founded in 1903, the International
Brotherhood of Teamsters represents 1.4 million hardworking men and
women throughout the United
States, Canada and
Puerto Rico. Visit
www.teamster.org for more information.
About Kroger
At The Kroger Co., we are dedicated to
our purpose: to Feed the Human SpiritTM. We
are 453,000 associates who serve nearly nine million customers
every day in 2,793 retail food stores under a variety of local
banner names in 35 states and the District of
Columbia. Our Family of Companies operates an expanding
ClickList offering – a personalized order online service – in
addition to 2,258 pharmacies, 783 convenience stores, 307 fine
jewelry stores, 222 retail health clinics, 1,472 supermarket fuel
centers and 38 food production plants in the United States. Our Company has been
recognized as one of America's most generous companies for our
support of more than 100 Feeding America food bank partners, breast
cancer research and awareness, the military and their families, and
more than 145,000 community organizations including schools. As a
leader in supplier diversity, we are a proud member of
the Billion Dollar Roundtable.
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SOURCE The Kroger Co.