[Congressional Record Volume 151, Number 29 (Friday, March 11, 2005)]
[Senate]
[Page S2522]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. HARKIN:
  S. 607. A bill to amend the Employee Retirement Income Security Act 
of 1974 and the Internal Revenue Code of 1986 with respect to early 
retirement benefits, and for other purposes; to the Committee on 
Health, Education, Labor, and Pensions.
  Mr. HARKIN. Mr. President, I rise to introduce a bill that will 
prevent workers from losing a large chunk of their pension when they 
work for a company that sells their division.
  This legislation is prompted by articles written by Mary Williams 
Walsh in the New York Times outlining the story of how a group of 
workers in Olean, NY lost $25 million in promised benefits when their 
division was acquired and then spun off.
  Current law says that if a company wants to amend their pension plan, 
they have to give workers the share of their early retirement subsidy 
that they have already earned. However, a company doesn't have to do 
that if your division is bought and sold--even if the workers are in 
the same building, sitting at the same desk, and doing the same job the 
whole time. That's just ridiculous.
  In this case, Halliburton purchased a division of Dresser Industries, 
and seventeen months later spun off the Olean, NY division, netting 
$215 million. They treated those employees as if they had resigned and 
gone to work for Ingersoll-Rand. While employees who were 55 years old 
were kept whole, anyone younger lost up to half the value of their 
pension overnight, without being informed. They realized what had 
happened in June 2002 when they got notices in the mail telling them 
that they had 90 days to either collect a much smaller benefit than 
they had anticipated, or lose their right to a lump sum payment 
forever. Some recent retirees were even told that they got paid too 
much, and had to give back pension money they already received.
  Meanwhile, the CEO during that period, now Vice President Dick 
Cheney, got a special pension deal from the board totaling an estimated 
$10 million in benefits, even though he hadn't worked there long enough 
to qualify for a pension under the usual rules.
  This is a completely unconscionable way to cheat hard working people 
out of their promised pension benefits.
  My will would simply require that companies must follow the same 
rules about applying credits toward pension under mergers and 
acquisitions that they do under any other kind of pension plan 
amendment.
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