Dear AT&T Members and Retirees,
As many of you know, last year AT&T entered into an agreement with subsidiaries of a life insurance company called Athene Holding Ltd, under which pension annuity benefits covering over 96,000 retirees and beneficiaries would be transferred out of the AT&T Pension Plan and to Athene, which would take over payment and administration of these benefits.
CWA has serious concerns about transactions like these, which are often called “pension risk transfers.” Pension benefits transferred to life insurance companies are no longer backstopped by the Pension Benefit Guaranty Corporation (PBGC) but are instead covered by the applicable state insurance guaranty association, under which protection levels vary across the country.
In addition, we have concerns about the business practices of Athene, which is wholly-owned by a private equity firm called Apollo Global Management. Athene is an outlier among life insurance companies with risky, non-transparent business practices that include off-shored reinsurance and high concentrations of risky assets.
CWA has been working to fight back against this transaction which threatens the retirement security of our members.
AT&T retirees have recently taken an important step by filing a class action complaint against AT&T, alleging that AT&T and its advisors breached their fiduciary duty in their selection of Athene. Pension plan sponsors have an obligation under federal law to select the safest available partner for transactions such as these, and we agree with our retirees that Athene does not live up to that standard.
Our retirees are asking the court to require AT&T to backstop all the benefits transferred to Athene, ensuring benefits maintain the same guarantees that retirees expected to have through the course of their career.
If you would like to learn more about AT&T’s transaction with Athene and this legal complaint we are hosting a town hall call on June 5th at 8pm ET/ 5pm PT. Please click here to register.
In Unity,
Claude Cummings Jr.
President
