030739 UFCW Local 56 Pension Shifts to Indexing FundsJuly 19, 2003
Cherry Hill, NJ - The United Food and Commercial Worker's Local 56, a union that represents over 13,000 members in the New York, New Jersey, Delaware, Maryland and Pennsylvania areas, announced today the organization's pension plans have commenced a transition of assets from actively managed accounts to passively managed funds. UFCW Local 56 is one of the first, if not the only union to fully embrace index investing.
President of UFCW Local 56, Anthony Cinaglia, commented on the news, "The indexing initiative is being implemented only after intensive study, due diligence and historical analysis of the risk versus reward balance between passive and active investment. After a thorough assessment of the costs and benefits associated of the two investment styles it is clear that it is in the best interest of our union, our members and pensioners to re-allocate our assets to indexed funds."
The funds include the Retail Meat Pension Plan, UFCW Local 56 Savings Plan and the Health and Welfare Plan. The combined assets of these funds represent over $300 million and the future value of this initiative is expected to be more than $300 million in additional returns and savings to Local 56 pension plans over a 30-year period.
Eric Ten Broeck, Director of Research, Development and Plan Design for Local 56, who performed the due diligence on the indexing initiative concluded, "Over the long-term, we feel confident that this initiative can deliver enhanced benefits to our union members, significant cost savings to the pension plans and offer financial relief to contributing employers."
The Vanguard Group is assisting UFCW Local 56 in the transition to indexed funds.
About UFCW Local 56
UFCW Local 56 began in 1941 as the Amalgamated Meat Cutters & Butcher Workmen of North America with their charter signed on February 14.
In 1978, Amalgamated Meat Cutters & Butcher Workmen of North America merged with the Retail Clerks International Union to become the United Food & Commercial Workers Union. UFCW Local 56, AFl-CIO represents various business arenas including retail stores, manufacturing plans and healthcare facilities. This local is the largest labor union in South Jersey and the second largest private sector labor union in the Philadelphia area. Local 56 is comprised of approximately 13,000 members and spans over 4 states. UFCW Local 56 provides an array of benefits for their membership consisting of health & welfare, pension plans, and legal services.