Major League Baseball owners, despite earning more than $8 billion in revenue in 2013, voted in January to allow individual teams to slash or eliminate pension-plan offerings to their non-uniformed personnel. The vote, tabled a year earlier when the intention became public, quietly took place Jan. 16 at the quarterly owners meetings in Paradise Valley, Ariz., the same gathering at which instant-replay expansion unanimously was approved. The retirement plans of any baseball employee not wearing a big league uniform may be affected by the decision, including secretaries, scouts, front-office executives, and minor league staff. Some of those personnel, particularly at the minor league level and in amateur scouting, make less than $40,000 a year and rely on pensions in retirement. Rob Manfred, MLB's chief operating officer, noted no team has yet acted to reduce employee pension benefits. "The change in the rule does not require a club to change anything," Manfred said. "All 30 clubs are free to leave their plans exactly where they are and, in fact, no club has made a change. This change gives the clubs the ability to put together what they feel is a competitive pension program in their particular market." Manfred also vehemently objected to any characterization that the owners are going after baseball's employees while owners and players continue to reap huge sums. "Large corporations all over America make adjustments in their pension plans," Manfred said. "That's like saying because the top line is billions of dollars, they shouldn't be making changes to their pension plans. "The fact of the matter is that the structure of one's pension, and the appeal of that pension to employees, varies greatly depending upon the makeup of your workforce. We have traditionally had defined-benefit pension plans in baseball, but a lot of young people would rather have a defined-contribution plan [401(k)]. "So I just don't think it's so simple as to boil it down to there's a bunch of money and they're taking away people's benefits. First of all, I'm going to say again: Nobody has changed any benefits. And it remains to be seen whether or not that's going to happen. And, point two, I think that the motivation to make a change in the pension area in general is driven by the desire to be competitive in their markets and provide the kind of benefits that people want in today's economy." The owners technically voted to repeal the "compatibility rule." That rule mandated that each team provide a pension to employees through the Non-Uniformed Personnel Pension Plan, or provide something of equivalent quality.
MLB teams can elect to cut pensions
ESPN New York | Feb 14