Vol XI, No. 30TNG/CWA Local 31041March 20, 2000


401K Plans Compared
How do the current Journal 401k, the current Belo 401k and the new Belo 401k retirement programs compare? See a side-by-side comparison below.

Plan is described to Guild negotiations but not formally offered; it would scrap traditional pension for enhanced 401k.

The Guild is analyzing the new Belo Corp. pension program that was outlined to union negotiators - but not actually offered the Guild - at last week's negotiations.

Under the new program, Belo plans to phase out its corporate pension plan, replacing it with a souped-up 401k retirement savings account.

The initial outlines of the new plan make it look like a robust program.

However, whether it provides as good a benefit as a combined pension-and-401k program is a question that can't be answered immediately - and may depend on individual circumstances.

Further, the announcement of a new plan, which the company plans to roll out for its non-Guild workers by July 1, leaves open the question of whether Guild workers will be able to enroll in the current Belo pension before it is closed out to new entrants.

The Guild will try to describe the plan in as much detail as possible in this newsletter, as well as in subsequent issues of the Guild leader when we learn more.

The pension situation is not (quite) as complicated as it sounds.

First, understand that we are talking about three sets of benefit programs:

  • The old Journal Company pension and 401k programs, in which Guild members are enrolled now.
  • The current Belo Corp. pension and 401k programs. In general, these benefits are more generous than the old Journal plans. During negotiations so far, access to the current Belo benefits has been a major Guild bargaining goal.
  • The new Belo Corp. pension program, which was just disclosed last week, and which the corporation is planning to put into effect by July 1. This has been outlined to the Guild - but not actually offered at the bargaining table.
Here is how the new Belo program will work, according to the corporation's documents:

Currently, non-Guild workers who now are eligible for Belo benefits will be offered two choices, and must decide on one before July 1: (A) stay in the old program; or (B) join the new one.

If they join the new one, their old Belo pension plan will be frozen at its current level, meaning that it will provide some of the pension payout - but not all - that it would have at retirement age.

Meanwhile, these employees' enhanced 401k will start being funded.

The situation is different for workers hired after July 1: they will be offered only the new 401k program. And they will not have a "vested" ownership of company contributions for the first three years of employment.

This is how the new 401k program will work:

1. Instead of funding its corporate pension plan, Belo will contribute 2 percent of a worker's salary to the 401k plan in "cash." For example, if a worker earned $50,000 a year, Belo would pump in $1,000.

2. If a worker contributes part of his or her salary to the new 401k plan, the company will throw in more money: 75-cents for every $1 contributed by the worker. There is a limit. The company will add the matching funds only up to the first 6 percent of a worker's salary. The worker can contribute more than that, but the company's matching funds stop at that level. Using our $50,000 example, 6 percent is $3,000; so 75-cents-per-$1 works out to a maximum match of $2,250.

There are two important changes: under the current Belo 401k, the company makes no automatic contribution; for the new program, it puts in 2 percent of salary. Further, under the current Belo 401k, the company matches employee contribution, up to 6 percent of salary, at a rate of 55-cents for each $1 invested by the worker; now that match will be 20-cents more, for a total contribution of 75-cents-per-$1.

In addition, the Corporation has broadened the kinds of investments that can be used to support the 401k. In the current Belo plan, the company's contribution is entirely in its own stock. Now, the company will continue to make the 55-cents-per-dollar match in stock. But the added match, the 20-cents extra, will be in "cash," for investment in a family of Fidelity financial plans. Also, the 2 percent of salary will be paid in "cash."

There are many unknowns.

How does the 2 percent corporate contribution compare to the amount of money that the company would have invested in the standard pension plan?

Standard pension plans are guaranteed by the federal government; 401k plans are not.

And of course, making your own investment decisions can be much riskier than standard pension plans which are conservatively managed by experts.

The Guild will analyze the Belo plan. The union already has asked for additional information, and will seek more.

Meanwhile, the union is interested in the opinions of its members.

You can speak or write to members of the negotiating committee and executive board; and call the Guild administrator, Tim Schick, at 421-9466 or e-mail Tim at png@riguild.org.

Type of 401KOpen to Guild?Terms of PlanEstimated maximum annual company contribution for person earning $50,000
Journal Co. 401K planYes
  • Company makes automatic contribution of $10.50 a week.
  • Company matches $3 a week if employees puts in at least 2 percent of salary.
  • Company contibution: $546
  • Company match to employee contribution: $156
TOTAL: $702
Current Belo 401K planNo
  • No automatic company contribution
  • Company puts in 55-cents for every $1 of employee contribution, up to 6% of salary.
  • 55-cents for each $1 of employee's contribution of up to 6 % of salary (55% of $3,000).
TOTAL: $1,650
New Belo 401K planNo
  • Automatic company contribution of 2% of salary.
  • Company puts in 75-cents for every $1 contributed by employee, up to 6% of salary.
  • Automatic contribution of 2% of salary (2% of $50,000): $1,000.
  • Match of 75-cents per $1 employee contribution, up to 6% (75% of $3,000): $2,250.
TOTAL: $3,250


Vote to unionize Telegram & Gazette circulation is 39 to 10

In a 100% turnout, the Providence Guild won representation rights in The Worcester Telegram and Gazette's Outside Circulation Department.

The vote was 39 yes, 10 no with 1 blank ballot. At the time of the election, there were 50 eligible voters.

Balloting took place between 3:30AM - 4:30AM at the employer's facility in Leominster and between 5:30AM - 8:30AM at the production plant in Millbury.

The new unit consists of District Managers, Single Copy Field Sales Manager, Dock Workers, Single Copy District Managers, NIE Sales Manager, Home Delivery Field Sales Manager and Redelivery Drivers.

The near 4-1 margin of victory came in spite of an intense and personal campaign by the company.

The internal committee did a "hell of a job," said Tim Schick, Guild administrator.

The committee turned out 100% of the Guild vote. Members were diligent in making one-on-one contacts with employees throughout the campaign.

The Providence Guild won bargaining rights in the Editorial Department in 1993. That group has not yet won a contract but remains strong.

The Telegram & Gazette was purchased by The New York Times Company from the Chronicle Company on January 8 of this year.

Copyright © 2000 The Providence Newspaper Guild
TNG/CWA Local 31041
270 Westmister St., Providence, Rhode Island 02903
401-421-9466 | Fax: 401-421-9495