Pensions.......

ualdriver

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Aug 20, 2002
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Judge Approves End of United Pension Plans
Tuesday May 10, 6:47 pm ET
By Dave Carpenter, AP Business Writer
Judge OKs Termination of United Pension Plans, Clearing Way for Largest U.S. Pension Default


CHICAGO (AP) -- A federal bankruptcy judge approved United Airlines' plan to terminate its employees' pension plans Tuesday, clearing the way for the largest corporate-pension default in American history.
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The ruling, which carries broad implications for U.S. airlines and their workers, shifts responsibility for United's four defined-benefit plans to the government's pension agency.

That will save cash-strapped United an estimated $645 million a year, part of the $2 billion in annual savings it says it needs to line up enough financing to emerge from Chapter 11 bankruptcy as soon as this fall.

But the cost will be painful to its employees, who stand to lose thousands of dollars annually off their pensions when they are assumed by the Pension Benefit Guaranty Corp.

The PBGC, the government's pension insurer, initially opposed United's plan. But it agreed to drop that resistance last month in exchange for up to $1.5 billion in notes and convertible stock in a reorganized UAL Corp., United's holding company.

United's pensions are underfunded by an estimated $9.8 billion, of which the PBGC would guarantee only about $5 billion. The previous largest U.S. pension default was Bethlehem Steel's $3.6 billion in underfunding in 2002.
 
I'm sure United is preparing to seek an injunction from the court to bar CHAOS activity. It will be very interesting tomorrow to see if the unions were all talk no action.
 
Yet Tilton gets 1.1 million in salary (that's admitted to) plus $4.5 million in GUARANTEED pension. Airline employees are being played for SUCKERS by the executives and their buddies in the Bush Administration.

Unfortunately, airline workers are dumb sheep and will piss and moan, but at the end of the day will shuffle off to work. And the likes of Tilton and Mr. Bush know it. Hence we get what we deserve.

Seems it takes a catastrophie to get this dumb political administration to do anything at all.

The BK laws need to be changed saying that WORKERS get paid first (including pensions and up to a certain limit to prevent looting by executives) before other creditors get a dime. That would cause the shark investment bankers to think twice before throwing money at executive morons like Siegel, Lakefield and Goodwin, et al.
 
Yeap it will be interesting to see if the AFA will really live up to the CHAOS threat!!!

Tomorrow will be VERY interesting to see ig the judge will abrogate the contracts????? If he had a judgment in one day on the pension issue he will probably have the contracts abrogated by tomorrow afternoon. It's a pity what UniTED management has gotten away with for decades.
 
yea while millions of middle class Americans who have worked their entire lives to get a piece of the "The American Dream" watch as their jobs go oversea's, and their pensions become a fraction of what they would have been, and face the prospect of probably having to work until they drop dead , our Lousy government sends $$$$ BILLION'S $$$$ to prop up another country while ours is suffering! SIMPLY FU@KING PATHETIC GW.........!!!!!!!!!!!
 
Not to mention the blood of Americans that Bush seems content to keep pouring into the sands of Iraq.
 
mrfish3726 said:
Yeap it will be interesting to see if the AFA will really live up to the CHAOS threat!!!

Tomorrow will be VERY interesting to see ig the judge will abrogate the contracts????? If he had a judgment in one day on the pension issue he will probably have the contracts abrogated by tomorrow afternoon. It's a pity what UniTED management has gotten away with for decades.
[post="268170"][/post]​

They won't!
 
I don't think United can go to the court with an injunction or TRO unless they can prove that activity is taking place. Isn't that correct? They'd need some evidence that something was afoot I believe.

As for tomorrow, I think the judge will take at least a day to decide the fate of the labor agreements. While the pension issue was a no-brainer, the labor contacts in my view are a bit more complex and will take some time for him to go over. I would expect him to rule by week's end.

I wouldn't count on Bush intervening if one or more labor groups walks off the job. Remember, he's from Texas and I'm sure will be hearing from the lobbyists in the employ of AA, CO and WN, as well as the Texas congressional delegation. Don't think those airlines wouldn't push hard to allow UA to be the industry's first post-9/11 sacrificial lamb.
 
i feel for each one of you fine employees at ual. i am at usair but am being furloughed at end of day june 5th. we lost ours back in jan and of course our good ol iam union sold us out including the provision to outsource 30 cities. hope it doesnt come down to the level for you ual employees. good luck to you all
 
Winglet said:
Yet Tilton gets 1.1 million in salary (that's admitted to) plus $4.5 million in GUARANTEED pension. Airline employees are being played for SUCKERS by the executives and their buddies in the Bush Administration.

Unfortunately, airline workers are dumb sheep and will piss and moan, but at the end of the day will shuffle off to work. And the likes of Tilton and Mr. Bush know it. Hence we get what we deserve.

Seems it takes a catastrophie to get this dumb political administration to do anything at all.

The BK laws need to be changed saying that WORKERS get paid first (including pensions and up to a certain limit to prevent looting by executives) before other creditors get a dime. That would cause the shark investment bankers to think twice before throwing money at executive morons like Siegel, Lakefield and Goodwin, et al.
[post="268168"][/post]​

Geez, I shoulda responded to this post instead...

This is exactly what I was talking about. In BK, the company is run for the benefit of creditors. I was saying that years ago. Do you understand now? I think you finally do.

As for "the BK laws need to be changed so WORKERS get paid first", well, let's just say that no administration, Republican or Democrat, is about to do that. It would stand every facet of corporate BK, built up over more than a hundred years, on its head. Yeah, I know, that what you'd like. Well, I'd like to wake up tomorrow and see a Ferrari in my driveway (OK, actually I'd rather see a Mercedes E55 AMG. Or see the Ferrari, sell it, buy the Mercedes, and invest the rest of the cash, but I digress). But sadly, when I go to my garage all that will be there is an old Prizm.

The BK laws don't give a rodent's patootie what you'd like them to be. Griping about it now that you find out the result isn't what you'd like (mainly because you ignored the reality of BK law way back when) is a waste of time.

-synchronicity
 
synchronicity said:
Geez, I shoulda responded to this post instead...

This is exactly what I was talking about. In BK, the company is run for the benefit of creditors. I was saying that years ago. Do you understand now? I think you finally do.

As for "the BK laws need to be changed so WORKERS get paid first", well, let's just say that no administration, Republican or Democrat, is about to do that. It would stand every facet of corporate BK, built up over more than a hundred years, on its head. Yeah, I know, that what you'd like. Well, I'd like to wake up tomorrow and see a Ferrari in my driveway (OK, actually I'd rather see a Mercedes E55 AMG. Or see the Ferrari, sell it, buy the Mercedes, and invest the rest of the cash, but I digress). But sadly, when I go to my garage all that will be there is an old Prizm.

The BK laws don't give a rodent's patootie what you'd like them to be. Griping about it now that you find out the result isn't what you'd like (mainly because you ignored the reality of BK law way back when) is a waste of time.

-synchronicity
[post="268263"][/post]​
-------------------------------------------------------
Actually, Bankruptcy does not wipe out the ability of the IRS to recover taxes owed so why should the PBGC be treated any differently?

With the PBGC, it will come down to a taxpayer bailout of one sort or another.

Elevate the status of the PBGC to that of the IRS, at least the US taxpayer will recover some portion and future lenders will consider the funding status of the pension in question in determining the credit worthiness on a case by case basis.

As for wishing for a Ferrari and finding a Prizm, we could wish that the personal assets of Corporate Officers would be subject to seizure for failure to fund the balances and that the Bankruptcy Court must consider the funding status of all pensions any time a KERP/SERP payment request is presented.
 
Elimination of the pension plans gives employees absolutely no reason to keep United operating. With even a thread of hope that some pension benefits will be paid (as Delta and Northwest are trying to do), employees have an incentive to keep the company operating. Whether the unions succeed at taking collective action, United is bound to feel the repercussions of what happened today. Individual employees will suddenly find that an extra long weekend seems appropriate this summer....
It simply is alot easier to never give an employee a benefit than to take it away. UA employees cannot help but be peeved at what has happened today... and I sympathize completely with them. Many UA employees will have to work much longer than they had planned in order to recoup their losses and some retirees will probably have to return to work someplace. That kind of personal "inconvenience" simply does not translate into first rate customer service - and United will pay the price for it whether the unions institute it or not.
My condolences to all United employees and retirees on this very sad night. Just remember, there will be a day when justice will take place.
 
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