There is now fear that this arbitration power will be used to force newly unionized workers to take on pension plan coverage with already existing union multi-employer pension plans. An editorial in the Washington Examiner discusses this. It gives some very interesting information on how badly funded these pension plans are. It notes that:
Pensions for nearly half of the nation's 20 largest unions are classified as either "endangered" or in "critical" condition due to underfunding, according to federal actuarial reports. Pensions with less than 80 percent of the assets needed to cover present and projected liabilities are considered "endangered," while those below 65 percent are classified as "critical" under the Pension Protection Act of 2006. The average union pension has resources to cover only 62 percent of what is owed to participants, according to the government-backed Pension Benefit Guarantee Corp. (PBGC). Less than one in 160 workers is presently covered by a properly funded union pension plan. Failed pension plans are bailed out by the PBGC.It appears that getting more union members into these underfunded pension plans is to be used to improve the likelihood that these critically underfunded pension plans will either be paid up by additional companies forced into them or by the taxpayers through the Pension Benefit Guarantee Corp.