Alring, So The Pension Bailout Passed

[airlineorphan]

News just came in that Congress sent the pension bailout to President Bush for signing. It apparently includes cash handouts to airlines and steel companies in addition to changes in the schedule of payments into pension funds.

What will this mean for pilot pensions at US Airways (and the rest of us)?

Any pilots care to comment? Other folks as well, of course....

In solidarity,
Airlineorphan

Reuters brief on pension bill

 

[airlineorphan]

Yes, I know, that was really supposed to read

"Alright, So The Pension Bailout Passed...."

Doh!

-Airlineorphan

 

[airlineorphan]

Here's the official ALPA response....

ALPA Reaction to Senate Passage of Pension Funding Equity Act

-Airlineorphan

 

[A320 Driver]

What this means to me is that if U pilots get the DB plan restored, the little bit I have in my DC account goes away. Then when this outfit turns belly up, I'll have even less cash to fall back on. But the senior boys will come out good.


A320 Driver

 

[767jetz]

It apparently includes cash handouts to airlines and steel companies...

This is completely false information. Please check your facts before spreading rumors like this!

There will be no "cash handout" to the airlines or steel industry.

The legislation changes the way future obligations are calculated for the next 2 years. This will reflect a slightly higher, more realistic rate of return on the money in the funds, which will means they will be less underfunded and the companies will not have to contribute as much into them.

Secondly, when pensions become underfunded by a certain %, the current rules require accelerated payments called Deficit Reduction Contributions (DRC). The airlines will be given relief from these DRC's for 2 years. They still have to make normal contributions to the pension funds. Assuming the economy shows modest improvement over the next 2 years, the pension underfunding will resolve itself.

Once again: THERE IS NO CASH HANDOUT FROM THE GOVERNMENT!

 

[airlineorphan]

767jetz,

Sorry, I don't mean to spread false information. The articles I've read specifically refer to 1.6Billion in aid to the airlines and steel and made it look like it was in addition to any fiduciary re-rigging that would be allowed (delayed payments, etc).

Is this 1.6Billion actually the estimated value of the fiduciary re-rigging and therefore really a shifting of company cashflow issues downstream?

I was surprised to see the number separated out from the rest of the assistance, so I'm afraid I jumped to a conclusion.

Anyway, that's why I asked. Thanks for clarifying. Can you (or others) elaborate further?

In solidarity,
Airlineorphan

 

[ITRADE]

IIRC, this does not apply to US as their pension has already been TERMINATED by the Court.

 

[airlineorphan]

ITRADE, and others,

I remember discussion of a restoration of the pilots' DBP if the pension relief bill passed. Of course if it is just discussion, I imagine that it will stay just discussion.

Can anyone shed any light on this?

I'm sure this is a foolish question, but hey, never hurts to ask.
-Airlineorphan

P.S. ITRADE, what does "IIRC" mean?

 

[Walmartgreeter]

ITRADE, and others,

I remember discussion of a restoration of the pilots' DBP if the pension relief bill passed. Of course if it is just discussion, I imagine that it will stay just discussion.

Can anyone shed any light on this?

I'm sure this is a foolish question, but hey, never hurts to ask.
-Airlineorphan

P.S. ITRADE, what does "IIRC" mean?

That ship has sailed. U Pilots had until the end of last year for pension relief to possibly restore their plan. Funny thing is, some people are saying it would now actually be cheaper for U to go back to the old DB plan, especially with the relief possibly pending. My two cents only.

 

[767jetz]

ITRADE, and others,

I remember discussion of a restoration of the pilots' DBP if the pension relief bill passed. Of course if it is just discussion, I imagine that it will stay just discussion.

Can anyone shed any light on this?

I'm sure this is a foolish question, but hey, never hurts to ask.
-Airlineorphan

P.S. ITRADE, what does "IIRC" mean?

Sorry, didn't mean to imply that you intentionally posted bad info.

As for US pilot's pensions, there was a push to include a clause that would re-instate their pension, but it was removed from consideration early on. The legislation that the House & Senate have been struggling to rectify never included the provision.

 

[ClueByFour]

P.S. ITRADE, what does "IIRC" mean?

If I Remember Correctly.

 

[ktflyhome]

IIRC sure clears up alot of things for me. Thanks, Clue

 

[airlineorphan]

767jetz wrote:

Sorry, didn't mean to imply that you intentionally posted bad info.

As for US pilot's pensions, there was a push to include a clause that would re-instate their pension, but it was removed from consideration early on. The legislation that the House & Senate have been struggling to rectify never included the provision.

Thanks 767jetz, I understand the hair trigger.... There's plenty of intentionally posted bad info out there and the stakes certainly feel high these days with the company's brinksmanship.

As for the US-ALPA DBP, this certainly is a disappointment. There have been many things that have outraged me by the way U has trampled its employees over the last 3 years (as one of the early furloughs, I've still got some of their boot marks), but what I regard as the swindle of the pilots deferred earnings, that is the termination of their pension plan, as one of the worst betrayals by this management "team"

I had hoped that something about this pension bill would have helped the pilots. Otherwise I'm not sure of the value of legislation that grants management more latitude in their obligations to maintain solvency of such deferred income funds like DBP's. It would be nice to see some legislation that affirms managements obligations to commitments made to employees instead....

In solidarity,
Airlineorphan

P.S. Thanks, Clue, for the internet jargon definition!

 

[ITRADE]

As for the US-ALPA DBP, this certainly is a disappointment. There have been many things that have outraged me by the way U has trampled its employees over the last 3 years (as one of the early furloughs, I've still got some of their boot marks), but what I regard as the swindle of the pilots deferred earnings, that is the termination of their pension plan, as one of the worst betrayals by this management "team"

I had hoped that something about this pension bill would have helped the pilots. Otherwise I'm not sure of the value of legislation that grants management more latitude in their obligations to maintain solvency of such deferred income funds like DBP's. It would be nice to see some legislation that affirms managements obligations to commitments made to employees instead....

In solidarity,
Airlineorphan

P.S. Thanks, Clue, for the internet jargon definition!

Such is life in Chapter 11 reorganization.

 

[airlineorphan]

You are correct ITRADE. Such is life in Chapter 11. It's one of the many tools corporations have at their disposal to impose their will upon employees. That's why us workers need strong unions to level that playing field.

Happy Friday!
-Airlineorphan