LANDOVER, Md., (January 13, 2021) — Effective January 1, 2021, the retirement benefits earned by Giant and Safeway employees and retirees in Maryland, Virginia and Washington, D.C. — members of United Food & Commercial Workers (UFCW) Local 400 and UFCW Local 27 — will be protected under a groundbreaking agreement with both unions, Giant, Safeway and the Pension Benefit Guaranty Corporation (PBGC), the government agency that insures defined benefit pension plans.
“When we started this process, thousands of hard-working union members were at risk of potentially losing the benefits they had earned,” said UFCW Local 27 President Jason Chorpenning. “I am pleased to say that by settling this agreement, that risk has been greatly diminished and our members’ retirement benefits are secured.”
The FELRA & UFCW Pension Fund and the Mid-Atlantic UFCW and Participating Employers Pension Fund (MAP Fund) are the pension plans under which the Giant and Safeway members earned benefits through December 31, 2020. Under the agreement, the MAP Fund was combined into the FELRA Fund on December 31st and, when the FELRA Fund becomes insolvent, which is projected to occur in late 2022, PBGC will pay FELRA Fund benefits guaranteed by PBGC under law and two new plans, funded by Giant and Safeway, will pay any FELRA Fund benefits not guaranteed by the PBGC. There are also negotiated protections in the event PBGC becomes insolvent. Accordingly, through the combination of the PBGC guarantee and the new pension plans funded by Giant and Safeway, UFCW members covered by the FELRA and MAP Funds will receive the full benefits they earned as of December 31, 2020.
New variable defined benefit pension plans also have been established as of January 1, 2021 to provide the same benefit levels as were earned in the past under the FELRA Fund and MAP Fund, except that those benefits can vary based on future investment returns.
“This exceptional agreement is the first of its kind,” said Mark Federici, President of UFCW Local 400. “I’ve never even heard of a deal like this before. But after long, protracted negotiations, we are very pleased to have achieved this unique solution that protects the retirement benefits our members have earned for years to come.”
This one-of-a-kind arrangement was designed both to protect Local 400 members’ pension benefits earned as of December 31, 2020, as well as members’ ability to continue to earn strong pension benefits into the future. The groundbreaking deal was achieved after months of negotiations between UFCW Local 400, UFCW Local 27, Giant, and Safeway, resulting in the collective bargaining agreements ratified by the membership in March 2020. There were then months of further negotiations among these bargaining parties, PBGC, and another contributing employer whose employees are covered under the FELRA & UFCW Pension Fund.
The United Food & Commercial Workers Local 400 is led by President Mark Federici and represents 35,000 members working in the grocery, retail, health care, food processing, service and other industries in Maryland, Virginia, Washington, D.C., West Virginia, Ohio, Kentucky and Tennessee.
United Food & Commercial Workers (UFCW) Local 27 represents more than 22,000 hard-working men and women in Maryland, Delaware, Pennsylvania and West Virginia in grocery and retail, pharmacy, food processing, chemical processing, meatpacking, manufacturing, cannabis, gaming, and public sectors.