thats what it sounds like. that makes me very uncomfortable. if 5,000 take it at $100,000 each thats $500,000,000 that would be very enticing to cut next year in bankruptcy.
American looking to "right-size" the company and staffing levels for the Fall and 2021
- Thread starter jimntx
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it's not about that, you know that. the BOD has OKed more debt, just to file? they'd all be gone.
and..the stock did get a bump yesterday on a terrible market day.
and..the stock did get a bump yesterday on a terrible market day.
talked to a co-worker yesterday. she's 60 with 33 years seniority and she's 99.9% leaving. she had a discussion with a supervisor and the supervisor had most of the facts and answers for questions.
staying on payroll vs. immediate separation. sounded like a no-brainer to me.
immediate separation is the way to go. ability to immediately collect your pension vs. having to wait for apprx. 1 year.
only questions are: does immediate separation mean you pay cobra rates, in her case, for 5 years. another question is - she's entitled to 6 months pay in her lump sum payment next year, how many VC weeks is she also entitled to? likely 2/3..or 1 more additional month.
she'll get definitive answers from company and then probably leave.
i asked why would anyone want to stay on payroll and i guess the benefit over lump sum choice is some type of continuous income (80 hours pay a month for 1 year) and the travel benefits are more generous.
even if you keep current aa insurance rates for 30 months, you're still paying with your money out of 'continuous income' for 12 of those months. immediate separation, you can use the money aa will let you use immediately - even if it's at expensive cobra rates, aa is paying and even after 5 years of paying that, she'll still have apprx. $85k-$90k in fund when she hits medicare age.
whether she stays and aa files for BK or whether she goes and aa files for BK..she's better off in which way??
i say go.
Well some very good news out of the Southwest camp. No layoffs this year. And hopefully not next either. Company will get 25% smaller in size by end of year. Since 28% employees take leaves, there may be no need for the involuntary leaves as long as we can slowly get passengers back to flying. Business will take up to 5-10 years. All explained by a very confident CEO below. A bit long, but very encouraging. In hopes other airlines can do the same if they get the leaves they need...
https://r.search.yahoo.com/_ylt=Awr...938.html/RK=2/RS=z._4pGvRZSlsupCiPzo_i5UtQvY-
https://r.search.yahoo.com/_ylt=Awr...938.html/RK=2/RS=z._4pGvRZSlsupCiPzo_i5UtQvY-
Talos
Senior
- Nov 23, 2013
- 442
- 95
I wonder what the cobra rates are? I would think considerable. Putting everything a year away doesn't sit well with me. It's like they get you out the door and then keep the option to screw you over. I don't think the company wants to but they may end up having to. I really see mgmt out the door with bankruptcy and any new people won't give a rats ass who they jerk around. If people are well set up financially then it is worth the risk. You would like to think a judge would try not to screw over retirees but there are no guarantees. It's a rough call for many I think.
cobra rates are at actual "active employee rates" which is what we pay now or will pay year to year.
Kev3188
Veteran
Correct. These are simply recording accounts; people won't be seeing $150k appear in their bank accounts.
i have known people who have declared bankruptcy, and when they know, the amount of debt really doesnt matter. whats one more surf and turf dinner?
Cobra is just the administrator of the policy...rates will mirror active member’s costs...
the question is - if you take immediate separation, are you still entitled to pay company rates for 30 months? it's that way if you take staying on payroll option.
worst case scenario, she isn't and must pay cobra rates for 60 months. her and her husband are looking at apprx. $1,500 a month? $90k? she'll still have $60k in fund once she hits medicare age.
if both plans keep you paying aa rates for 30 months. it's even more of a no-brainer to take the immediate separation.
why would you deny yourself 12 months of pension payments and also continue to pay for your insurance for 12 months while on payroll?
- Thread Starter
- #763
Not exactly. Here is a short-version of the Cobra premium calculation.
COBRA beneficiaries pay the full health insurance premium plus a 2 percent administration fee. If monthly premiums for employees with single coverage are $200, for example; the COBRA beneficiary pays 102 percent of that amount, or $204. Spouses and children also may be covered.
That description is a little murky. Say for instance, the total premium for an employee is $200/month with $100 paid by the member and the remainder by the company. If the employee is furloughed the
employee becomes responsible for paying the company's share of the premium--which is still $100/month. That $2 administration fee is a little goofy, but it has to be paid. So,
Company share = $100
Employee share = $100
Admin Fees $4
Monthly Premium $204 To be paid by furloughed employee.
I think the premium varies by benefits to be covered and such actuarial items as average age of the covered work group. Flight attendants pay a slightly higher premium than other groups because the average age is higher than other groups. (Remember, guys, AA's #1 (in seniority) attendant has been flying for over 60 years.) IIRC when I was furloughed from AA in 2003, my Cobra premium was over $300/month. I may be wrong about this paragraph. After all It's been 17 years since I was furloughed, and I was a flight attendant--paid to be cute, not smart.
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No...that money is earmarked for the 2012 early outs before November 1st of that year...
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