Union Leaders Call for New Retirement Plan to be Implemented

OAKLAND, CA: Labor leaders and workers rallied outside the state building in Oakland Thursday to call for the state Legislature to implement a new retirement plan aimed at helping the 7 million workers in California who don't have company retirement plans.

Alejandra Valles, secretary-treasurer of Service Employees International Union United Health Service Workers West, said, "Many people who are in low-wage jobs think they will have to die working" because they can't afford to retire. Valles said California is facing a tidal wave of discarded seniors who will retire with little or no financial support other than Social Security, rely on food banks and live in tents or cars.

"California must do better," Valles said. In 2012, the state Legislature passed "The California Secure Choice Retirement Savings Trust Act," which was authored by Senate President pro Tempore Kevin de Leon, D-Los Angeles, which would create a savings plan, known as a cash-balance account, that would allow workers to put 3.5 percent of their paychecks into an investment pool that would be managed by a state board. Workers would be automatically enrolled in the plan unless they ask to not participate.

However, the plan hasn't yet been implemented. The Secure Choice Retirement Board held a hearing today to consider options for implementing the plan. Labor leaders and workers who spoke at the rally, which was held before the meeting began, said they are pushing the board to opt for a plan called "Pooled IRA with Reserve" that shares market risk across many workers and across generations. They said a report commissioned by the board found that such a plan would also generate the best returns for all participants.

Josie Camacho, executive secretary-treasurer of the Alameda Labor Council, AFL-CIO, said the new retirement plan is needed because, "7 million people in the state don't have a future for their golden years and have to work two jobs to take care of themselves."

Camacho said that among those that the retirement plan would help are child care workers, janitors, fast food workers, home care providers, and seniors. Belle Lopez, a youth leader with Children Over Politics who is the daughter of a home care worker, said, "Youth of my generation see our parents working their fingers to the bone, with no choice but to work until they die." Lopez said, "My parents are living paycheck to paycheck and I worry that they will never have a secure retirement."

Steven Pitts, associate chair of the University of California Berkeley Labor Center, said researchers at UC Berkeley and the University of British Columbia found that the Bay Area faces a mounting retirement crisis which is defined by a rapidly-growing, increasingly diverse and economically vulnerable senior population.

Pitts said the demand for adequate housing, health care and supportive services for seniors is expected to increase significantly over the next two decades so he called for decision-makers to begin planning for that challenge. Speakers at Thursday's rally said they hope the state Legislature will vote later this year to implement the new secure retirement plan.

By Bay City News

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