ALPA, IAM, AFA, & other defined benefit pension plans to be terminated?

[mrplanes]

You have no reason to thank Dave or ask for another. You seem to think you have no recourse here other than whining about how we're getting screwed. My point, should you care to stop whining long enough to put some thought into your dilemna, is that your life belongs to you. Not Dave. Not USAirways. You. You can change anytime you like. In fact, the most successful person I know got that way when he decided to quit his job at IBM after numerous layoffs and paycuts and fend for himself. Whining is unbecoming and useless. If you truly believed everything you say about this company and what Dave is trying to do to you, you would be out of here in a heartbeat.

It is irrelevant who caused this problem. You have the power to get out any time you choose. Or you can stay and whine. Your choice. Not Dave's. Yours. But I'll tell you this: Whining and blaming will not make you or your family more secure. It only makes you look foolish.

 

[diogenes]

I thought the 1113 protection everybody was sooooo proud of prohibited the company from taking additional concessions from labor. Could it be the 1113 letters are not worth the paper they're written on?

I know, I know, U is BK, revenues are in the dumper, we have the potential of a double dip war with Iraq , etc etc.

To that I would add;

In periodicals as obtuse as Fortune and Business Week, the potential for a double dip recession has been stated ad nauseum since 9-11. I sure figured that into my personal financial calculus, and figured U had the brights to do so as well.

War with Iraq? See above. It hasn't exactly been a secret.

Now the company is saying, after an exhausting and time consuming round of concessionary negotiations that concluded only 2 months ago, gosh, we need more - conservatively, 15 to 25% more.

The explanation to that is;

1. We were too damn dumb to read Fortune and Business Week, and goofed in our calculations.

OR

2. Sure, we knew all that stuff, and this is our version of 'how to boil a live frog.' Turn up the heat slowly, and hope the frog is the stupid one.

I vote for 2 - they're not stupid. Us, I'm not so sure about!

 

[pitguy]

I find it in very bad taste to know that the company has cut the mechanic positions (and others) to the very minimum (or less) and have still left us 'fat' with supervisors and managers. They reward the non-union employees by giving them holidays back and only taking a pay cut from them until early 2004. If one feels they should just run this place on the union employees backs I believe it will never work and I will gladly turn the light switch off if this is how it is going to be.

 

[chipmunn]

Diogenes:

The S.1113 letter provides protection for the unions from having concessions imposed by the court. US Airways has lived up to its promise to not ask the court for concessions.

However, the company has the legal right to terminate a pension plan, which is separate from the bankruptcy proceedings.

In addition, the PBGC has the legal right to take custody of a plan in distress.

On Friday, November 22, US Airways filed a motion with the bankruptcy court for the airline to have the sole right to file a Chapter 11 Plan of Reorganization through January 31, 2003.

According to Dow Jones, the filing said the carrier and its debtor entities fully intend, and are indeed obligated under various agreements, to file their plan of reorganization and disclosure statement before December 31. Also, US Airways said it expects it will file the plan and disclosure statement well before the year end in order to get court approval of the disclosure statement at a hearing scheduled for January 16, 2003.

Also noteworthy, court papers said the unsecured creditors' committee, which ALPA and the IAM are members, agreed with the proposed bridge order.

On the surface, it would appear the airline is having difficulty completing its reorganization, but it appears the airline has timed this motion with its intent to obtain union contract relief.

US Airways will meet with all of its labor leaders at 10:00 AM on November 26. According a recorded ALPA message on November 23, the agenda is for management to update labor on the US Airways’ ideas on potential solutions to the current problems the company is facing.

Reports indicate the company will provide the unions with one week, or until December 3 to reach voluntary concession accords on productivity and retirement changes, or the company can provide 60-day legal notice to terminate the defined benefit pension plans. If this occurs on December 3, 60 days will be January 30, 2003 or the same date the airline asked the bankruptcy court to extend its sole right to file a Chapter 11 Plan of Reorganization. Coincidental?

Chip

 

[pitguy]

I have reached the point where I give up! This place is insane.

 

[usfliboi]

It appears the pilot group will be hit the hardest, their pension is the one thats really gonna get slammed here. So i hate it for you guys if it does. Ill repeat, i dont think the company will give unions a week to agree to the productivity changes or the pension changes. Seigal and company have come too far to start screwing over its employees like that!! If it were that serious these issues would have been raised well before now. Will these be discussed?>Im sure! Lets give the guy credit if that were to happen it would be heavy handied and i dont think he would do it!

 

[autofixer]

usfliboi, I guess if the situation is really THAT BAD at U, he might be forced to. We will have an idea tomorrow.

 

[autofixer]

Pilot's contract page L2-1 says, The company must notify ALPA by April 30th subsequent to the end of the prior calendar pension year of decisions made and implemented by the company in the above areas (item 4: amendment or termination of the plan)in the prior calendar pension year. Any lawyers out there?

 

[pitguy]

The mechanics pension is in our contract also. So I would think it would be hard to change it in a way that would not pay out the same benefits.

--I think maybe another 6 million dollar bonus for the select few might help us out. Maybe even make it more this time.

--Is slavery still illegal?

--Maybe they can open a company store that we must all shop in and live in company houses too.

--Do they teach it somewhere that the worse you treat an employee the harder and more dedicated they will be. ( So much for the I'll treat you like a kid and I want you to act like a professional. It is not working.).

 

[diogenes]

Well, let me be the first to sacrifice my retirement plan...ooooh, that's right, I can't. It went the way of the dodo bird eight years ago.

Welcome to my world, Chip.

And as management had a free hand for a decade to wring costs out of my work group, what should fleet and customer service give up now? Other than the recurring outsourcing of our jobs.

 

[Biffeman]

You fail to mention anything about a pension plan in a labor agreement and all of the pension plans are above minimum funding at the moment

 

[chipmunn]

The PBGC Retirement Plan Termination Fact sheet says:

Distress Termination: A company in financial distress may voluntarily terminate a pension plan if:

the plan administrator has issued a notice of intent to terminate to affected parties, including PBGC, at least 60 days, and no more than 90 days, in advance of the proposed termination date;

the plan administrator has issued a subsequent termination notice to PBGC, which includes data concerning the number of participants and the plan's assets and liabilities; and

PBGC has determined that the plan sponsor and each of its corporate affiliates have satisfied at least one of the following financial distress tests - though not necessarily the same test:

- a petition has been filed seeking liquidation in bankruptcy;

- a petition has been filed seeking reorganization in bankruptcy, and the bankruptcy court (or an appropriate state court) has determined that the company will not be able to reorganize with the plan intact and approves the plan termination;

- it has been demonstrated that the sponsor or affiliate cannot continue in business unless the plan is terminated; or

- it has been demonstrated that the costs of providing pension coverage have become unreasonably burdensome solely as a result of a decline in the number of employees covered by the plan.

Involuntary Termination: The law provides that PBGC may terminate a pension plan, even if a company has not filed to terminate a plan on its own initiative, if:

the plan has not met the minimum funding requirements;

the plan cannot pay current benefits when due;

a lump sum payment has been made to a participant who is a substantial owner of the sponsoring company;

or the loss to PBGC is expected to increase unreasonably if the plan is not terminated.

PBGC must terminate a plan if assets are unavailable to pay benefits currently due.

Standard Termination: A plan may terminate only if plan assets are sufficient to satisfy all plan benefits and if the plan administrator has taken the following steps:

Issued a Notice of Intent to Terminate to affected parties other than PBGC at least 60 days, and no more than 90 days, before the proposed termination date;

it also must inform plan participants that PBGC's guarantee of their benefits will cease upon distribution of plan assets;

Informed plan participants of the identity of the private insurer from whom an annuity is being purchased or the names of insurers from whom bids will be sought no later than 45 days before the distribution of plan assets;

Sent each plan participant a notice that includes the benefit the participant has earned and data the plan used to calculate the value of the benefit;

Submitted a termination notice to PBGC, which includes certified data on the plan's assets and liabilities as of the proposed date of distribution;

and Distributed plan assets to cover all benefit liabilities under the plan.

For more information go to:

http://www.pbgc.gov/publications/factshts/TERMFACT.HTM

Chip comments: I am by no means a retirement expert and this is a complex subject. I suspect the contractual retirement plan language may apply to a non-bankrutpcy scenario and the PBGC giudelines override contractual language once the plan becomes distressed and underfunded.

Chip

 

[autofixer]

Funny, I was under the impression the s1113 letter (or whatever it is called) provided that the Company would not seek further contractural concessions if the Groups agreed to the Company's demands! It seems to me that U employees would have been better off to go straight to the judge in CH11. At least their fate would have been known months ago. Instead there is this Chinese water torture process. To be honest, I voted NO. I am out of here in 35 days and am taking my destiny into my own hands(Vol. furlough). I would advise all to do the same. It is obvious that management has an agenda that has not been stated...something other than just saving the company and its remaining jobs.(I don't know what it is...I don't have the information) Management has all of the information. Thus,they know what the future is. They knew they would shut down the TPA hangar,etc. It is now at a point where it is no longer trust but verify; it now is at a point to NEVER EVER PLAY WITH SOMEONE WHO HAS ALL OF THE INFORMATION AND WILL NOT LET YOU SEE IT! Rant over.

 

[ilg30/7]

Autofixer,

I'm with you. Put in my vol. furlough papers yesterday. Anyboy who cannot see the eventual fate of this company is blind. Management has ZERO credibility. This has ceased to be, if it ever was, 'pruning' to make yourself more efficient. It is a death spiral.

I'm tired of being lied to. I'm tired of being kept in the dark over matters that affect me profoundly. Most of all, I'm tired of seeing this company hurt people that I care about. [img src='http://www.usaviation.com/idealbb/images/smilies/15.gif']

Turned in my paperwork yesterday. Slept like a baby for the first time in months. Good luck to all.

 

[gogogadget]

The october 2002 issue of Consumer reports has an excellent article on your pension and what happens if it is terminated or underfunded and all you need to know. It is written in plain english and very easy to understand.

I would highly suggest checking it out. It starts on page 11. It might clear up some things regarding what all of this means and how it can/does effect you personally.

Hope it helps. It is a 3 page article and I wish I could post it all. here is a clip from page 13

A company can resort to a distress termination for several reasons: it will be liquidated under bankruptcy; the bankruptcy court has determined that the company cant both reorganize and fulfill the plan's obligations; or the PBGC determines that continuing the plan will be infeasible for the company.

Under a distress or involuntary termination, the PBGC becomes the plan trustee. It takes over plan assets and supplements from its own funds whatever is needed to pay curent retirees and vested employees who will retire in the future.

It also goes on to explain the possible scenarios of what your payments could be and how they can change for the worse!

Hope it helps