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Summary of CORRE Meeting

With M&O Contractors

August 12, 2003

SNS Conference Room

 Oak Ridge, Tennessee

 

1.      Linda Ponce opened the meeting with roundtable introductions.  She mentioned that we had recently met with Gerald Boyd and Bill Brumley at ORO.  She said that this was an important issue that the Congressional Delegation was concerned about and hoped for some improvement. 

2.      Charlie Kuykendall summarized the factors leading up to the formation of CORRE, including the history of adjustments by Oak Ridge Contractors, 420-Fund-transfer attempts, case histories, and Fund performance and current status.  Hard copies of the viewgraph presentation and the CORRE 2003 Position Paper were distributed.

3.      Steve Liedle remarked that at a recent anniversary celebration at the K-25 plant, retirees were invited to speak, and all communicated memories and dedication regarding their years as contractor employees to DOE.  He said that it gave him a new perspective toward retirees, their accomplishments, and their commitment.

4.      Jeff Wadsworth stated that we had a compelling argument in its own right, but asked if we could obtain comparable pension benefit data for the remaining DOE contractors.  CORRE responded that DOE/ORO asked the same question, and that Dan Wilkins was assigned the task by Gerald Boyd to get those data.  Bob Worrell will work with him.

5.      Jeff Wadsworth stated that the U. of Calif. Pension plan was different than ours in that it is a Defined Benefit Pension Plan.  If the value of the fund falls below a certain level, employees may be asked to make a contribution.  (Note:  No contributions have been made by the Company nor by employees for many years.)  So, it would appear that if the Funds have a “surplus,” that there is no effective difference nor justification why U. of Calif. employees should receive adjustments and Oak Ridge contractors not. 

6.      Jeff Smith asked on what basis we had selected the 75% restitution of original pension value as our goal.  Charlie answered that that is where we would be with the 15% adjustment (which Sandia got), and that it was less than the 85% values for the U. of Calif. Labs.  At the end, Jeff asked us to understand (and be sympathetic to) all the demands on overhead that the contractors faced – increasing medical costs, severance pay, increasingly unfunded overhead mandates by DOE, ES&H, physical plant refurbishment.)  These are the same problems that other contractors are dealing with and have dealt with for decades.

7.      Pete Lotts reminded everyone that no payments have been made into the Pension Fund since 1984, with liabilities continuing to increase for current employees, but with no consideration for retirees’ benefits.

8.      Denny Ruddy asked CORRE to understand that (a) the contractors will need to start paying into the Pension Fund soon just to meet current obligations, much less consider additional retiree adjustments; and that (b) DOE felt that the Pension Fund had been grown to a size adequate to meet needs, and that they were not enthusiastic about additional contributions of DOE dollars.  Ruddy acknowledged that required contributions to the Plan appeared to be about three years away at the current time (presumably without any retiree adjustments).  He seemed dubious about the wisdom of DOE in waiting so long to get started, fearing that the annual payments might become huge if delayed too long.

9.      Steve Smith commented that having a standard for maintaining a set percentage of purchasing power of pensions was not a normal industrial practice.  He admitted that he was unaware of any particular level DOE had encouraged under the present system, or any number of years between adjustment.  (There does not appear to be a present DOE or contractor policy.).  CORRE presented a strong case for having an agreed-upon level of purchasing power maintenance and established frequency of adjustments for maintaining it. 

10.  Bob Worrell clarified the history of pension benefit neglect following Union Carbide (post 1984) by saying that, with the passing of the corporate contractors and no direction from DOE, no attention was paid to retiree pension values by the contractors.  He explained that the DOE contract does not require the contractor to biennially review pension benefits when other benefits and salaries are reviewed and base-lined. 

11.  Dave Reichle added that if/when such was done, to be careful and not simply benchmark pension values at retirement, but also in the out years when lack of adjustments in Oak Ridge put retirees even further behind.  Steve Liedle expressed surprise that some effort had not been made to include retiree pension adjustments in the biennial contractor benefit surveys.  Boykin admitted that retirees had not been given enough attention in the past.

12.  Charlie Kuykendall said that CORRE hoped that the contractors would take the initiative, as they had done at Sandia, to provide for pension equity in Oak Ridge.

13.  The meeting ended with thanks to all by Charlie Kuykendall and Linda Ponce.  Linda told the M&O managers of CORRE’s Annual Membership Meeting scheduled for October 8 (and enabled Charlie to state that we represent 12,100 members) and welcomed folks to attend, saying that it would be a “big affair.”

14.  A summary of the CORRE request was left, which requested:

a.       A minimum monthly pension of $400/$600.

b.      An ad hoc increase averaging 15%.

c.       CORRE representation on the Pension Fund Advisory Board.

d.      Establishment of a policy of biennial review of pensions and adjustments to maintain 75% of initial value.

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