Jan 29th ALPA Code a Phone

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Aug 30, 2002
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MEC CODE-A-PHONE UPDATE
January 29, 2003
This is Roy Freundlich with a US Airways MEC update for Wednesday, January 29, with three new items:
Item 1. The MEC reconvened its special meeting today in Herndon to continue reviewing pension issues and unanimously passed the following resolution:
WHEREAS the US Airways MEC has given full consideration to the Company''s proposals, which do not even attempt to protect the benefits already earned, and
WHEREAS the MEC finds management’s proposed solution to the pension issue to be fundamentally flawed, completely inadequate, and unworthy of consideration due to the inequities that are embodied within it, and
WHEREAS management has indicated to the Association on January 23, 2003, of their intent to file in bankruptcy court for a distress termination of the pilots pension plan, and
WHEREAS management has also indicated that only the pilot pension plan will be terminated,
THEREFORE BE IT RESOLVED that the US Airways MEC opposes the termination of the pilots’ defined benefit plan and is taking all necessary steps, including activating all appropriate ALPA resources and committees, to protect the pension benefits earned by the US Airways pilots, and
BE IT FURTHER RESOLVED that all efforts will continue in earnest to seek a legislative solution to the pilot restoration funding proposal before the PBGC, and
BE IT FINALLY RESOLVED that should the Company file to terminate the pilot pension plan, the MEC will take appropriate legal action to object to the termination and will explore all other appropriate avenues in response to the Company’s action.
The MEC also directed that an outside actuarial firm be hired immediately to replicate and verify as closely as possible the computation that Towers Perrin conducted for the Company, including the conclusions they produced to justify the termination of the plan. Towers Perrin’s conclusions are unable to be 100 percent verified by ALPA’s limited computer modeling resources. The results of this project will be communicated to the MEC as soon as practical.
The MEC special meeting adjourned at 8:00 p.m.
Item 2. US Airways President and CEO David Siegel issued a letter to all pilots dated January 28 advising that you will receive a notice of the Company’s intent to terminate the pension plan on March 31, 2003. This notice is required by law to be sent at least 60 days before a plan termination.
After reviewing Mr. Siegel’s letter and attached questions and answers on the pension issue your MEC representatives were amazed, to say the least, at the inaccurate and misleading statements made by Mr. Siegel to our pilots. The letter, combined with Mr, Siegel’s corporate announcements and personal emails to pilots, are desperately misrepresenting the MEC’s December 13 position on this issue and the retirement benefits being offered by the Company. We will be providing additional information on these issues shortly.
Mr. Siegel is also misleading employees in his letter by saying that ALPA took the position that the Company should go after the pensions of others. In fact, however, it was and remains ALPA’s position that our pilots should not be paying for the full benefits of the other employee pensions, including managements, through our concessions, through our pension funding cuts, and through the sacrifice of our benefits. In addition, we are still waiting for management’s compensation package to be revealed in bankruptcy court in mid-February so that we can assess how much of our pension funding costs are being directly diverted to management’s personal compensation.
You should note Mr. Seigel is no longer saying in his January 28 letter that he is going to try to make pilots whole as he testified at the senate hearing only two weeks ago. Now it is about what the Company says is can afford to pay us in retirement benefits.
Make no mistake, the Company is trying to take away retirement benefits you have earned.
The MEC considers management’s actions to be inexcusable including the blatant attempt at using external parties to place more pressure on the pilots to accept inequitable treatment. This is futile strategy since it does not matter to us, the pilots, if others think we should lose pension benefits or pay for someone else’s pension benefits. What matters most is what you, the US Airways pilots, think about losing the pensions you have earned. And that is something that Mr. Siegel and other parties have so far failed to understand are going to have to recognize very quickly to resolve this issue.
ALPA has in no way agreed to the termination of the pension plan and is actively reviewing many alternatives to preserve our benefits. The MEC will be collectively sending a communication to all pilots in the very near future that will explain the issues we are facing, how your retirement, if management has its way, would be based on extreme financial assumptions with you bearing all the risk, and will explain the MEC ongoing efforts to preserve our pension benefits.
Your MEC recognizes this is going to be a difficult issue and is counting on your support and professionalism. Accordingly, please do not allow this issue to affect in any way your duties as flight crewmembers or the operation of the airline. It is imperative to our success that our airline’s operations remain reliable and stable. Any job actions are illegal and expose all of us to significant liabilities and to the failure of our efforts to preserve our jobs and our pensions. This is of the utmost importance and must be taken seriously and sincerely by all crewmembers. Please continue to participate in our legislative affairs program that is available on the pilots only section of the US Airways MEC website.
Item 3. US Airways today asked the bankruptcy court to extend the exclusivity period for filing a Plan of Reorganization by two months. This is the second time the Company has asked for an extension of the exclusivity period. It is common in large bankruptcy cases for the debtor to file a motion requesting an extension to allow them time to solicit plan votes from their creditors.
Item 4. Please note the following clarification to yesterday’s announcement: The Company’ proposed plan provides actual funding to the qualified contribution limited to 50 percent of pay or 40,000 dollars, but might require more. The notional accounts to be maintained instead of direct payout are in regard to the excess contribution requirements.
Please remember we have 1,748 pilots on furlough, with 79 pilot furloughs scheduled for February 4.
Thank you for listening.

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"Mr. Siegel is also misleading employees in his letter by saying that ALPA took the position that the Company should "go after the pensions of others." In fact, however, it was and remains ALPA’s position that our pilots "should not be paying for" the full benefits of the other employee pensions, including managements, through our concessions, through our pension funding cuts, and through the sacrifice of our benefits. In addition, we are still waiting for management’s compensation package to be revealed in bankruptcy court in mid-February so that we can assess how much of our pension funding costs are being directly diverted to management’s personal compensation."

I think ALPA pensioners are getting screwed. I also think it is a clear cut choice to terminate ALPA's pension, if the facts presented are accurate, in that US Airways must satisfy certain ATSB requirements dealing with profitability within a set timeframe. It makes no sense to punish others by terminating all pensions. And besides, there would not be enough saved to pay ALPA's funding requirements even if it were the other pensions being terminated. ALPA's is displaying serious disregard for others I think. We are NOT responsible for your pension problems. No one has inferred there is any connection, other than ALPA, and even ALPA (correct me here) has not offered a solution to their problem associated with other workgroup plan terminations.

I would more lend support to ALPA's cause if they would stop pressuring the company on others' pensions. What is expected of the money saved by termination? I doubt ALPA will recommend or support any new plan that does not absorb totally what money US Airways can afford to pay, and that will almost certainly exceed the combined contributions to the IAM and AFA pensions.
 
There is one other thing to keep in mind. As I understand it, a company cannot simply terminate for its own convenience a pension plan that is insured by the PBGC. Even for a company in Chapter 11 bankruptcy, if the pension plans are fully (or almost fully) funded, as I believe is the case with the AFA and IAM pension plans at US, then the PBGC can prevent a company from terminating any such plans. Thus, I believe that ALPA's argument that if its pension plan is terminated then all US pension plans should be terminated, is using faulty logic and does not follow the PBGC's rules based on its interpretations of the requirements of the ERISA Act.
 
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On 1/30/2003 10:25:42 AM nvrsaynvr wrote:

It makes no sense to punish others by terminating all pensions. And besides, there would not be enough saved to pay ALPA's funding requirements even if it were the other pensions being terminated. ALPA's is displaying serious disregard for others I think. We are NOT responsible for your pension problems.


I would more lend support to ALPA's cause if they would stop pressuring the company on others' pensions. What is expected of the money saved by termination? I doubt ALPA will recommend or support any new plan that does not absorb totally what money US Airways can afford to pay, and that will almost certainly exceed the combined contributions to the IAM and AFA pensions.

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nvrsaynvr,

This mentality is what brought us the "B" scale,Metro-Jet,and Mid Atlantic.

As long as I have mine, don't mess with me. Let the others take the hit and I'll support the whole idea. If I have to give then I am against it.

What happen to SHARE? How about everyone who has a UNDER FUNDED pension plan also live with the PBGC guidelines. Including Dave and the boys.

DAVE living one LIE at a time!

Truely Sad, He could of had World and the followers to get him there.

 
At the January 13 Senate hearing held by Senator's Specter and Santorum, a PBGC counter witness, who was the former PBGC General Counsel and wrote the current PBGC guidelines, testified that US Airways proposed restoration funding plan was legal and currently authorized per the current guidelines.

This point is being aggressively pursued by ALPA/US Airways congressional delegation and has been put in front of the Senate Finance Committee.

According to an article today that appeared in Reuters, although up to this pont the Senate refused to help (US Airways) with its pension problem, Republican Sen. Charles Grassley of Iowa, the chairman of the Senate Finance Committee, said Congress needed to look at the overall pension funding problem.

"We will need to deal with this particular problem (US Airways) when we deal with the rest of the funding rules and the pension interest rate problem, because that is a very real problem," he told the Senate. "We need a solution that would be nation-wide, not dealing with just one company."

Yesterday's motion by US Airways to seek two more months to file its POR in bankruptcy court and mail its disclosure statement to its creditors, will provide more time to find a legislative solution to the underfunded pension problem.

Chip
 
The ALPA January 29 code-a-phone said, "US Airways today asked the bankruptcy court to extend the exclusivity period for filing a Plan of Reorganization by two months. This is the second time the Company has asked for an extension of the exclusivity period. It is common in large bankruptcy cases for the debtor to file a motion requesting an extension to allow them time to solicit plan votes from their creditors."

Chip comments: Hummmm...what's the hold up?

Chip
 
Cosmo-

There's a lot of faulty logic in the Code-a-phone above. Including the implication that these dynamics were unknown to ALPA. Why on earth would the PBGC not challenge 'pension fund creaming:' dumping only the bad stuff on the PBGC and keeping the new cash out of the PBGC system. Apparently, it's been tried before and the US Supreme Court said NO WAY.

The issue is money and where it's going to come from, since there isn't any.

Hell, if ALPA can somehow convince the other defined benefit pension groups to kick in some cash, or find some from some other source.. .maybe agree to some smaller additional reductions in payouts and get the company to add some more, they can avoid the termination.

Or maybe they are hoping to terminate, refund, get sued and win?? Or stall in the meantime?
 
a320,

this is about the best post i have seen...
as far as waste....i runs rampent in every dept...
as others have stated..you seem to keep a very even keel through all this...


 
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On 1/30/2003 12:22:52 PM ClueByFour wrote:

Assuming Bronner plays ball.
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We've been dodging that bullet now for months. I think the reality of that particular threat is pretty much wasted on most employees. I have resigned myself to an attitude of apathy. What else can they do to me? Management took nearly half of my pay, raised my medical premiums and is about to take my retirement. I'll do the best job I can for as long as it's here, then I'll do something else. Some of the nicest people I know sell paint at Home Depot. They aren't despised by their management or talked down to. They just do their thing, adjust their lives to their income and make the best of their place in the scheme of things. This management team promised a multi-pronged attack to our problems.
1. Seek concessions from labor.
2. Seek concessions from leasing companies.
3. Reduce waste and costs.
4. Increase revenue.
5. Promote new thinking.

Well, so far they have hit #1 3 times, hit #2 once and the rest have fallen by the wayside. I mean what lunatic thinks that moving all 737 training to those pathetic facilities in PIT and paying all those overnight expenses for pilots to commute there is saving money? All they will do now is hit #1 again. Make the pilots give up per deim for all training (thats their thinking isn't it?)!
My point is, nobody in management seems to give a flip about the waste that still abounds in our company but they sure can wring concessions out of the rank and file. Cav, Pitguy, Biff and the others talk about the problems and waste in maintenance but is anybody listening??? NO. If we all work for free, it won't make us any more of a going concern. Until this management team moves it's focus AWAY from employee paychecks and benefits, everyday is just one step closer to the grave. If ALPA has to draw the line, then so be it. Our friends in IAM tried to tell us this months ago and we turned a deaf ear because we were afraid...and now I'm sorry I didn't listen.
Sorry for all the ramblings here but I just had to get this off my chest.

A320 Driver