Pension Legislation

[whaledriver]

Northwest Applauds Congress' Passage of Legislation That Saves Employees' Pension Benefits
Thursday August 3, 11:08 pm ET


WASHINGTON, Aug. 3 /PRNewswire-FirstCall/ -- Northwest Airlines (OTC: NWACQ - News) tonight applauded Congress' passage of pension reform legislation that will save the pension benefits of 73,000 current and former Northwest employees...

 

[PurduePete]

Northwest Applauds Congress' Passage of Legislation That Saves Employees' Pension Benefits
Thursday August 3, 11:08 pm ET
WASHINGTON, Aug. 3 /PRNewswire-FirstCall/ -- Northwest Airlines (OTC: NWACQ - News) tonight applauded Congress' passage of pension reform legislation that will save the pension benefits of 73,000 current and former Northwest employees...

That's great, but I'll bet that Northwest's lawyers are looking for loopholes in the legislation as we speak... :down:

 

[FWAAA]

That's great, but I'll bet that Northwest's lawyers are looking for loopholes in the legislation as we speak... :down:

Loopholes to do what, exactly?

NW got everything it wanted in this legislation: 17 years to make up its shortfall plus a more favorable interest rate assumption than CO or AA get to use in figuring their minimum contributions.

 

[groundcontrol]

Loopholes to do what, exactly?

NW got everything it wanted in this legislation: 17 years to make up its shortfall plus a more favorable interest rate assumption than CO or AA get to use in figuring their minimum contributions.

17 years....do you think NWA will be around in 17 years?
Anyone know what happens in the case of a merger?

 

[robbedagain]

17 years....do you think NWA will be around in 17 years?
Anyone know what happens in the case of a merger?

firsthand account: we went ch11 2x and lost pensions in 2nd then merged with HP!

 

[PurduePete]

Loopholes to do what, exactly?

NW got everything it wanted in this legislation: 17 years to make up its shortfall plus a more favorable interest rate assumption than CO or AA get to use in figuring their minimum contributions.

Meaning that IF Northwest is still around in 17 years, I feel they will still try everything in their power to get out from honoring their pension obligations. I can see them making only the minimum required contributions for a while, then use some excuse (high oil prices, war in the Middle East, recession, etc.) to dump their plans on the PBGC. I guess that's just my opinion from seeing how this company operated for the last 17 years... 🙄

I have no idea what's in the legislation, but hopefully there are safeguards from allowing that to happen, or very strict penalties enacted if that does come to pass.

 

[UAL_TECH]

Northwest Applauds Congress' Passage of Legislation That Saves Employees' Pension Benefits
Thursday August 3, 11:08 pm ET
WASHINGTON, Aug. 3 /PRNewswire-FirstCall/ -- Northwest Airlines (OTC: NWACQ - News) tonight applauded Congress' passage of pension reform legislation that will save the pension benefits of 73,000 current and former Northwest employees...

JMHO,

This is simply a reprieve from what "will" come.

Good for some on a 'temporary' basis but in the long haul you will be screwed as much as the rest and in the end, this action may be the straw that broke the camels back. With continued under funding stretched out this will put a 'greater' burden for the PBGC and possibly cause the termination of the PBGC cheese (that some are living /surviving on) under the current PBGC umbrella.

There isn't a company fully funded of their obligation (promise?) of retirement benefits under the 'old' DB plans and now you expect different results with a longer 'make up' plan? Will companies from this day forward fully fund their plans with this new law?

NOT!!!

 

[groundcontrol]

17 years....do you think NWA will be around in 17 years?
Anyone know what happens in the case of a merger?

Anyone have an answer to this questions yet?
Just wondering.

 

[Don Smith]

...I have no idea what's in the legislation, but hopefully there are safeguards from allowing that to happen, or very strict penalties enacted if that does come to pass.

I doubt that the language in the legislation had any nwa specific language in it. It was also a pension relief for government vendors also. Just because "northwest applauds pension legislation", doesn't mean nwa will abide by pension legislation. nwa is in BK, they could still ask the judge to toss them. We all know how sympathetic judge Grooper is to employees struggles. We are talking about Doug Steenland here. Hell magazine's CEO of the Year.

 

[jimntx]

I doubt that the language in the legislation had any nwa specific language in it.

Well, Don, actually there is--without naming NWA specifically. There is language in the bill that any company that has frozen its defined benefit plan, allowing no new employees to join and halting accrual of benefits gets 17 years to make up the shortfall. All others get only 10 years.

Among airlines, only NWA and DL qualify for the 17 year payout.