retirees denounce benefit reductions
Some stand to lose most of the value of their life insurance.
By Steve Alexander
Minneapolis Star Tribune
Thursday, October 25, 2006
Some Minnesota Qwest retirees said Wednesday they felt betrayed
by the company's announcement this week that it will cut
retirement benefits, which they said could be devastating for
some former colleagues. "It's a terrible double-cross," said
Arnie Albrecht of Roseville, who retired in 1994 as head of the
company's regulatory operations in Minnesota. "To retain
people, they promised them retirement benefits while they were
employed. Then, after the people retired and didn't have any
power, they jerked it out from under them."
Qwest Communications said this week that in response to "market
conditions" it would stop providing retired workers with
increases to their pension payments or health care benefits, and
would cap their life insurance at $10,000 -- a huge drop for
many workers. About half of all Qwest's retired workers --
25,000 to 30,000 people -- are believed to be affected.
Those who retired from Qwest or its predecessor, US West, after
1990 will suffer the health care cutbacks. Only nonunion
retirees are affected by Qwest's $10,000 cap on life insurance
because union members previously had that limit. Union members
also aren't immediately affected by the freeze on health care
payments, but they probably will be in the future, said Dick
Johnson, 71, of Blaine, a former Qwest technician and union
executive who retired in 1996.
The announcement followed two profitable quarters and the
company's decision to buy back up to $2 billion of its stock.
The reduction of life insurance benefits is particularly
harmful, Albrecht said. "I've had a quadruple bypass, a heart
attack and a pacemaker. I can't replace that company life
The company's retiree life insurance had been based on a
formula: It was equal to people's salary in the year they
retired, then over several years gradually diminished to half
"For me, the $10,000 life insurance cap amounts to a $15,000 to
$20,000 decline," said Marlyn Beaudine of St. Cloud, who retired
in 1989 as a telephone line construction director for part of
Minnesota and the Dakotas.
"It's just another corporate greed story to me," said Mary Ann
Neuman, 60, of New Hope, who retired as a corporate
communications staff manager in 2001. "My reduced life
insurance won't even be enough to bury me." It could be
devastating for some retirees," Johnson said. "All these people
were led to believe they would have pension increases, and that
the rest of their benefits would always be there."
Neuman said, "I'm very angry that the people who worked so hard
for the company are getting so hurt."
Steve Alexander •