Chamber Challenges AFL-CIO Health Care Proxy Campaign

Last week
the U.S. Chamber also alerted the Securities Exchange Commission
to reports of the AFL-CIO’s plan to push shareholder proxy
resolutions requiring employers to provide expansive new health
care benefits to their workers and forcing them to disclose the
personal political contributions of executives and directors to
candidates who oppose the AFL-CIO’s political agenda on health
care.

"The billions of dollars held in union pension funds belong to
workers, not to union officials," said Randel Johnson, Chamber
vice president for Labor, Immigration and Employee Benefits.
"Those funds exist solely for the purpose of ensuring a secure
and dignified retirement for beneficiaries and retirees–not to
be cannon fodder for other people’s political agendas."

The Chamber’s letter to the Department of Labor points out that,
under the Employee Retirement Income Security Act (ERISA) of
1974, pension trustees are to act solely in the interest of
pension plan participants and must not subordinate the interest
of those participants to unrelated objectives. In fact, if union
pension funds adopted the AFL-CIO’s new proxy agenda, they could
diminish the value of companies in which they were invested,
thereby harming union retirees’ pension assets.

This is not the first time the AFL-CIO has encouraged union
pension plans to tap workers’ retirement savings in support of
political and legislative action. In 2005, the Department of
Labor wrote the AFL-CIO concerning reports that the AFL-CIO had
encouraged union pension funds to threaten withdrawal of pension
plan assets from companies that supported President Bush’s
Social Security reform proposal. The Department’s letter stated
that such tactics could constitute a violation of pension
trustees’ fiduciary obligations under ERISA.

"The AFL-CIO’s shareholder activism plan appears to promote
using union members’ retirement savings to advance a legislative
and political agenda that has virtually nothing to do with
securing and enhancing those pension savings," added Johnson.
"Those who are responsible for overseeing workers’ retirement
security need to curtail the politicization of pension plan
assets."

The U.S. Chamber is the world’s largest business federation
representing more than 3 million businesses and organizations of
every size, sector, and region.

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