InternationalShannon
Veteran
Aw crap not another one. :down: What was the first one again?
771 days left
- Thread starter phlgreaser
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jimntx
Veteran
I know that those of you who have lost your pensions get your knickers in a bunch every time you think about the fact that AA employees still have theirs. However, try to eliminate the emotion, envy, and attempt to listen to logic.
AMR's pension funds are 95% funded. AMR would gain exactly nothing by dumping the pensions on the PBGC. Of course, the PBGC would LOVE to become custodians of a fully-funded pension plan for once, but that's not going to happen.
They may use Ch. 11 to abrogate the current contracts if new contracts are not forthcoming (all represented workgroups are in negotiations right now). But, dump the pensions that they have worked so hard to fund? Not very likely.
Also, I would not put it past a single one of the AMR unions to include in the next contract that the plans will close and future hires are to be excluded from the plans--i.e., 401K only for newhires.
sharktooth
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The US east pilots plan was funded to 96%, and still, the former pilots union gave it away. Shameful.
InternationalShannon
Veteran
Are we really counting down the days left until we (where is that damn OMG face?) go down the toilet?
found it!
No wonder you fools are so miserable. You need to have your posteriors examined, I think there might be a foreign object that used to belong to a tree there.
Dislodge. I repeat Dislodge!!
found it! No wonder you fools are so miserable. You need to have your posteriors examined, I think there might be a foreign object that used to belong to a tree there.
Dislodge. I repeat Dislodge!!
signals
Veteran
Since United is doomed close to 270 days before US, I wouldn't really start panicking until they're declared dead!
Who pays these people to do these studies?
...and do you get your money back if they are totally wrong?
signals
Veteran
Note to self:
Maybe we're looking at this doomsday clock all wrong. Wouldn't the days of survival have started on April 1, or I assume the start of 2Q08, or what most of us call 'the second quarter'?
Bah! What do I know?
I don't think it matters if the pension funds are funded or not.
The bottom line is these companies want to dis-continue these types of employer funded plans.
IF AMR plays the bankruptcy card. prepare to be frozen. [no emotion, envy involved.]
jimntx
Veteran
Note that I said that I wouldn't be surprised if the AMR unions agreed to closing the plans to future hires. However, frozen and eliminated are two different animals entirely. Frozen does NOT mean dumped on the PBGC.
signals
Veteran
Are we really counting down the days left until we (where is that damn OMG face?) go down the toilet?
No wonder you fools are so miserable. You need to have your posteriors examined, I think there might be a foreign object that used to belong to a tree there.
Dislodge. I repeat Dislodge!!
Shannon, maybe you should stop flying Derrie-Air out of PHL
I beg to differ, Thats exactly what it means.
Freeze the pensions, and "dump" it on the PBGC.
That's what happened @ Usair...
jimntx
Veteran
A plan can also be frozen and NOT dumped on the PBGC. But, even if it were, the only employees at AA that would be truly hurt are the pilots. They are the only non-management employees at AA who are eligible for a pension larger than the PBGC maximum of approx. $45,000/yr. The rest of us would get the same pension we were going to receive anyway. It's just that the check would be signed by a different payer.
Well, we might get a slightly reduced amount due to proration for the 5% underfunding, but the PBGC could probably petition the bk court to make the company pay up that relatively small amount, or at least a substantial portion of it.
sharktooth
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With the pilots, there were three options:
freeze, freeze and distribute, and terminate. Only one, terminate resulted in all the assets being dumped onto the PBGC, YMMV. For the pilots, the other two options did not involve the PBGC at all.
Termination, for some mysterious reason, was the only option considered by the former pilots union.
Freezing would have frozen the asset, no money in and no money out for a specified amount of time. Freeze and distribute would have frozen, then distributed the monies based on what a pilot had contributed.
Interestingly, the termination plan through the PBGC, distributes based not on what a person had contributed, but based on their age at the time of termination. So, one gets the FO rep of PHL retiring with ~$3600 per month with 17 years service and the CAP rep of PHL retiring with $1800 per month with 30+ years of service.(How did those two vote, again?) Also, the list used is the pilot list. So, a company that was integrated just prior to "termination of a plan", that opted to forego retirement in return for seniority (the first "nic"), would be beneficiaries of a plan they had contributed nothing to.
For those whining about being a minority, the above was done directly controlling only 1/3 of the MEC.
It appears AWA was too late to do this.
sharktooth
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Why ever would you do that?
Why terminate a plan to the PBGC, only to have a company bring the plan back to full strength via a bankruptcy court? How would that save the company money? With the fees upon a plan charged by the PBGC, why would you cost the company what they would pay to fully fund the plan, and further restrict funds? Unless you all just wanted to give the federales more money.......
If the you intend the company pay the shortfall anyway, um, just have them do it.
BoeingBoy
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There seems to be some confusion concerning funding levels of a DB plan. Such a plan can be fully funded on a continuation basis but be significantly underfunded on a termination basis. Naturally, the annual statements issued to those in the DB plan use the continuation basis while the termination basis is used when the company wants do dump the DB pension on the PBGC.
It seems there's also some confusion concerning how the PBGC calculates pension payments when a plan is terminated. It would be almost impossible for a 30 year employee to get substantially less than a 17 year employee, unless the 17 year employee had a significantly higher income prior to termination (not likely unless the 30 year pilot was out on medical) or was substantially older at termination.
Jim
It seems there's also some confusion concerning how the PBGC calculates pension payments when a plan is terminated. It would be almost impossible for a 30 year employee to get substantially less than a 17 year employee, unless the 17 year employee had a significantly higher income prior to termination (not likely unless the 30 year pilot was out on medical) or was substantially older at termination.
Jim
sharktooth
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Indeed. I think the confusion lay with the union handling the negotiations, because quite a few line pilots knew the difference.
Also, the pension payment is calculated, not based on years with a company, but purely based on age of the recipient at plan termination. In the case of the US pilot, 53 was the cut off. I know one pilot who turned 53 one day after the termination. He gets the lower rate. Had he been born two days earlier, or, if the termination had been two days later, he would get the higher payment, according to the helpful people at the PBGC meetings. Even the "helpful PBGC people" said that he got a raw deal.
