DukeEmployees.com - Duke Energy Employee Advoacate
News Jan. & Feb. 2000
governments for any country whatsoever. - Adam Smith, "The Wealth of Nations"
L. A. Times 2/29/00
Treasury Secretary Lawrence H. Summers on Monday set new rules on corporations and their tax advisors in an effort to curb a boom in abusive tax shelters that he said is costing the government up to $10 billion a year.
This is great news! Aren't you getting just a little tired of EVERYTHING being skewed in favor of big companies? Big companies take the profits from our labors and hire groups to lobby for laws that hurt us. Everyone knows that Duke-Energy is in for every little trick method of boosting the bottom line. Heaven forbid just earning money! If there is a slight of hand method of APPEARING to be earning more money, such as robbing the pension fund, Duke is all over that!
The current wave of tax shelters is largely confined to the corporate sector, experts say. It is fueled by tax lawyers, accountants and other financial services providers who have discovered they can command seven-figure fees by devising impenetrably complex financial instruments in which large companies can hide their taxable earnings.
In this new environment, "$100 million is not a large deal," said Paul J. Sax, a San Francisco tax lawyer who heads the American Bar Assn.'s taxation section. "There are $1-billion deals." Typically, promoters sell the new shelters on the pitch that the competition is already doing the same thing, Sax said. "Corporate America is under greater pressure to produce earnings. The odds favor you getting away with this so dramatically that [executives think] you should do it.
Where have we heard of this before? Groups making huge profits by selling dubious get rich quick schemes to corporations? Not only are companies, such as Duke Energy, feeding off of the employees pension funds, some of the companies are avoiding paying taxes on legitimate profits by using tax scams. And, the Carpetbaggers who promote these schemes use the very same tactics used to sell the cash-balance scams: "the competition is already doing the same thing" and "the odds favor you getting away with this." Just like the hack insurance salesman who palms off a worthless policy on an unsuspecting sucker, and then sells all of the sucker's friends and relatives policies. "Just look, Joe Blow bought a policy; so should you." These groups find a company with gullible senior management and sell them a scheme. Then they run to other companies screaming, "look what the competition is doing!" The other greedy companies follow like lemmings, right off the cliff. Duke Energy claimed the cash balance plan would make them more competitive. Sure, if Duke bleeds its employees while another DECENT company doesn't, Duke has an advantage over the decent company. When the carpetbaggers finally sell all companies on cash balance schemes, no one has an advantage. But, all American workers have very poor retirement plans. The groups who sold the schemes are rolling in money. And, the senior management of the companies are bloated with cash. There are honest companies that never fell for the get rich quick schemes. These are the companies that will win out over the long run. Their employees will help them achieve success. The employees who have been destroyed financially, will repay their companies in kind. By that time, the rotten senior management will have skipped out. Someone else will be left to try to salvage what is left of the company. Some companies will be beyond salvage. Such will be the carnage left behind by the CEOs who live for "deal flow."
L. A. Times 2/28/00
Boeing engineers were back on the picket lines Sunday after contract negotiations between the company and their union broke down and a federal mediator left town.
Yes, engineers can have union representation also.
"The Wall Street Journal" 2/17/00
With the 2000 presidential primaries in full swing and the November elections approaching, Americans were asked which candidate's tax platform they prefer: Gore drew the most support, while George W. Bush came in second and Bill Bradley, third.
And, Al Gore is the only candidate so far with a pension plank.
Poughkeepsie Journal 2/17/00
In a move called precedent-setting, a federal agency has told IBM Corp. that it does not believe the company can stop shareholders from putting a resolution improving pensions to a vote. Many IBMers see thousands of dollars a year in retirement-income at stake. The proposal, sent by James Leas of Burlington, Vt., an IBM employee, along with 329 formal co-proposers, calls on IBM directors to amend the pension plan that IBM changed in 1999. The proposal would grant all employees the superior retirement and medical choices that employees within five years of retirement have. It would permit the 'portable' cash balance plan IBM installed in July, but with benefits equal to the old plan.
This is great news for the IBM employees. IBM refused to allow the resolution to be voted on. But, the Securities and Exchange Commission is forcing IBM to comply with the shareholder's wishes!
CNN - 2/16/00
U. S. Congressional Representative Bernie Sanders said, "IBM's efforts to block consideration of this stockholder resolution were clearly out of line."
The resolution in question was filed by 330 stockholders, including 300 current IBM employees, who contend the new pension plan discriminates against older workers by cutting promised benefits. These cash balance plans are a growing trend around the country as companies shift resources away from traditional pensions and toward higher pay or stock options. Claims of age discrimination are being investigated by the Internal Revenue Service, the Labor Department and the Equal Employment Opportunity Commission.
The same outfit that was involved in IBM's pension conversion also did the conversion for Duke Energy Corporation!
Employee Advocate - DukeEmployees.com - 2/11/00
The doubters said that when the Fieldcrest employees voted in a union that they would regret it. The doubters said that the employees had waited too long to vote in a union. They said the company was dying and the employees would only get less benefits. It seems as if the doubters are wrong again. Those too timid to seek anything, will get nothing. The Fieldcrest employees got pay raises and their first ever sick days with their first union contract. You must remember, that these employees are starting at ground zero when it comes to benefits. At least now they are starting to get some benefits AND more pay. The negotiators did limit demands due to the poor state the company is in. But even so, the employees have already benefited from the union. The employee's pension benefits also increased. The employees now have a guarantee that if the company files for reorganization under the bankruptcy code, whoever acquires the company must also hire the workers under terms of the contract. So, even in a worst case situation, the employees still win. It took the employees decades to get union representation. For years management intimidated employees to keep a union out. Management led the employees to believe that a union would be bad for them and that they would lose benefits. Those who trust in management get what they deserve. We salute the Fieldcrest employees. They have won a hard earned victory.
The Wichita Eagle by Molly McMillin - 1/30/00
Some salaried nonrepresented workers at Boeing Wichita, who voted down a union two years ago, think they aren't being treated as well as other groups of workers.
It seems that these salaried workers had an opportunity to vote in union represention but, voted not to. Now they see the unionized workers getting better benefits and they are unhappy. Interesting.
Some salaried, nonunion workers at Boeing Wichita say they are upset, even angry, with their employer. They watched Machinists union members win 10 percent signing bonuses, get raises and retain benefits during last summer's contract negotiations with the Boeing Co. They've watched Boeing retain key health care benefits for its engineering union in its latest contract offer to workers in Seattle. Meanwhile, they've watched reductions in some of their own benefits - paying for a portion of the cost of their health care benefits for the first time, for example. What they see as unequal treatment by the company has affected morale, they say. 'It's a very divisive and corrosive environment,' said one disgruntled Boeing Wichita worker, who did not want to be quoted by name. 'We're not gaining - we're going backwards,' said another.
"Not gaining"? "Going backwards," you say? Well, at Duke Energy Corporation, we have been there and done that. We have had to pay insurance premumims for some time now. And, what we pay just goes up, and up, and up.
"It showed them clearly what the benefits of negotiations are," said Paul Shearon, contract administrator for the Society of Professional Engineering Employees in Aerospace, Boeing's second largest union.
There are groups of Duke employees who thought that they had no options. Options are available to those who seek them.
Employee Advocate - DukeEmployees.com - 1/23/00
The Charlotte Observer reported: "Duke Energy North America, an aggressive Duke-Energy unit 'expected' to show profit growth around 50 percent annually..."
DENA is EXPECTED to grow 50%; employees pensions have already shrunk as much as 50%. Duke's spin will probably be that this is "balanced growth."
Employee Advocate - DukeEmployees.com - 1/23/00
The Charlotte Observer reported that Jim Donnell, President and chief executive officer of Duke-Energy North America said, "Do we want to spend a lot of time doing battle to prove that we are doing things the right way and that we are, in fact, good guys?"
We guess not. After raiding the pension fund, Duke-Energy has yet to prove to the employees that they are, in fact, good guys!
Employee Advocate - DukeEmployees.com - 1/18/00
This "Wall Street Journal" article tells of The Association of Private Pension and Welfare Plans opposition to legislation sponsored by Representative Bernard Sanders to curb cash balance pension plans. It is said that the hit dog hollers. And, the APPWP is screaming! That is another group to put on the list of enemies. The APPWP is the enemy of all working Americans. "Critics argue that cash-balance plans allow employers to save money by reducing benefits for older workers in violation of age-bias laws. Despite a more-or-less level annual rate of company contribution, the cash-balance plans appear to violate age-discrimination law, which forbids reducing the rate of pension-benefits accrual as a person ages."
"Boston Herald" by Ellen J. Silberman 1/14/00
Duke Energy Corporation has announced that State Street Bank and Trust Company is going to replace Wachovia Bank as Trustee for the Duke-Energy-Retirement-Savings-Plan on February 1, 2000. State Street Global advisors Short-term Investment Fund will also replace the Wachovia Fund. They will handle all the Money Market Fund assets. They will also handle any cash in the Bond, Large Cap, and Duke-Energy Funds. When Duke Energy Corporation makes any announcement, employees instinctively grab their billfolds with both hands! This change may or may not cost us any money, but State Street Bank has received some negative press lately. Their name came up in a $6.9 million scandal involving fraudulent abandoned property claims.
Massachusetts Treasurer Shannon P. O'Brien's administration was duped into paying out $6.9 million in fraudulent abandoned property claims last April. O'Brien defended the payments, saying she was the victim of a well-executed scheme that included forged documents certified by the 200-year-old investment firm State Street Bank and Trust Co. First Deputy Treasurer Michael Travaglini said incomplete records that State Street originally turned over to the Treasury left everyone vulnerable to the fraud. Greg Ahern, a State Street spokesman, declined to comment on the investment bank's record keeping. The U.S. Attorney's spokesman, Herbert Hadad, declined to comment on the case yesterday, saying only, "The investigation is continuing."
The Wall Street Journal by Ellen E. Schultz 1/14/00
Ms. Schultz continues to do a great job getting the truth out about cash balance plans. This is terrific news. Those who try to hide cash balance plan age-discrimination are being exposed. Who will Duke Energy Corporation have left to run to?
Democratic Sen. Tom Harkin of Iowa sent a letter last week to the General Accounting Office, the investigative arm of Congress, asking it to look into the history of a controversial new type of pension plan that hundreds of employers have adopted in recent years.
The letter, dated Jan. 4, asks that the GAO specifically look into the origins of a sentence that was added to the preamble of some proposed pension regulations, shortly before they were published in 1991. The sentence, which was the subject of a Wall Street Journal article in December, has been regarded by employers as a safety blanket that protects them from charges that cash-balance plans violate age-discrimination laws.
The letter also suggests that the GAO look into the 'degree of outside influence in support of adding the sentence' that regulators received. And it asks, Did any of the key proponents of adding the sentence within the Treasury Department or the IRS, who left government service, receive significant financial benefit, directly or indirectly, during the year that followed their leaving government service because of the existence of the added sentence?’"
We ask again, if cash balance plans do not violate age discrimination laws, why are so many people knocking themselves out trying to exempt the plans from age bias laws? Could it be that the parties that sold these dubious plans knew that they were illegal all along? Senator Harkin has been doing a fantastic job of exposing the crooks. We should all support him in his efforts.
IBM Employee Benefits Action Coalition press release 1/14/00
We have warned that there are forces attempting to take away what little pension rights we have. Sometimes these attempts are hidden in legislation which sounds good on the surface. If "time bombs" can be inserted into otherwise good legislation, they have the potential to do employees great harm at a later date. Senator Rod Grams of Minnesota and Ron Gebhardtsbauer, a senior pension fellow from The American Academy of Actuaries in Washington, DC, unveiled a "Workers, Pension Benefits Protection" proposal. The proposal sounds good except for the anti age discrimination clause. You have already seen how greedy orginazations will twist and corupt existing laws. We cannot allow ANY weakness in new legislation. Seemingly good legislation which is flawed, may eventually cause employees more harm than good. The provision would:
Tampa Bay On-line 1/10/00
The Supreme Court refused Monday to free Microsoft Corp. from having to pay as many as 10,000 temporary employees who were not allowed to join the company's lucrative stock-purchase program. The 9th U.S. Circuit Court of Appeals twice ruled, most recently in May, that the temporary employees wrongly had been treated as 'independent contractors' or employees of employment agencies.
Microsoft is not the only company to deny employees benefits using such tactics.
Yahoo Finance - 1/6/00
U.S. Rep. Bernard Sanders and 45 other Congressmen urged the U.S. Securities and Exchange Commission to force IBM to allow a shareholder proposal on pension benefits. Adding a proposal to a stockholders' meeting is usually a complex, difficult, and costly endeavor. However, the IBM employees are vigorously pursuing just that with their usual skill and resolve. The proposal would force IBM to give all of its 145,000 U.S. employees a choice of the old pension system or the abusive "cash-balance" plan. Of all the employees that have had a choice, few have taken the cash balance plan, because they would lose so much money. Age discrimination is the major complaint. Quite naturally, IBM is opposed to the proposal; IBM would stand to lose all the money it has taken from the employees pension fund. Spokeswoman Jana Weatherbee, gave her usual worn out song and dance.