UPS and the International Brotherhood of Teamsters have signed a five-year tentative agreement that will establish a pension fund administered by the company and the union.

The deal will allow UPS to withdraw employees from the Central States multi-employer pension plan and to establish a jointly trusteed single-employer plan for about 42,000 Teamsters members.

The company will make a pretax US$6.1 billion payment to the Central States plan in connection with its withdrawal.

That plan has left UPS and other firms with larger liabilities as other companies participating in the plan have failed or been acquired.

The agreement also includes wage increases as well as contributions to healthcare plans for approximately 240,000 full- and part-time employees in the United States.

To comment on this story, email craig.sebastiano@rci.rogers.com.

Copyright © 2020 Transcontinental Media G.P. Originally published on benefitscanada.com

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