American Responds

[TWU informer]

Actually, I'm OK with his 79 grand. It's the SERP bankrupt-proof 8.2 million after taxes that galls me.

So you are OK with an individual making more for doing nothing at home than you are putting your license and arse on the line daily? No wonder the profession has taken a beating.

 

[TIME FOR CHANGE]

I'll take my lifetime pension payout weather its AA or the PBGC writing the check.
If it needs supplementing I will tar driveways for 75 dollars a pop.

 

[Wretched Wrench]

How would you like to be dependent on a stock based 401K retirement after the last two weeks?

What is the value of the defined pension plan now that we have witnessed 1 year of DJIA losses?

I hope no retiree is foolish enough to have very much of their 401k in stocks. Portfolios gotta be balanced.

 

[Wretched Wrench]

Actually, I'm OK with his 79 grand. It's the SERP bankrupt-proof 8.2 million after taxes that galls me.

So you are OK with an individual making more for doing nothing at home than you are putting your license and arse on the line daily? No wonder the profession has taken a beating.

I am OK with his $79K annual retirement being more than I earn. He was paid more, so would get a bigger retirement.

 

[Wretched Wrench]

He also got 8.2 million after tax dollars from the SERP. This is protected from any bankruptcy action. Our pension is not protected in any way, save the PBGC, which is already horribly underfunded by airline pension defaults.

Wrench, I often agree with your postings, but this one's in error. Your pension is protected, in part, by the $9.1 billion of assets (as of 12/31/07) of the AA pension plans, held in irrevocable trusts. Creditors of AA cannot attach or reach these assets in any way. They are protected from bankruptcy action.

That doesn't mean that AA could not petition a bankruptcy court to terminate them ala UA/US/DL pilot pensions. But even if that happened, the PBGC would get the $9.1 billion of assets to help pay the pensions.

I realize the SERP is a sore subject but what lots of people don't realize is that the SERP contained no assets until Carty's partial funding of the SERP. The SERP is non-qualified, so funding it in advance isn't as advantageous as with your much smaller, qualified pensions. Funding the SERP requires that tax be paid up front, while your pensions aren't taxed until you retire and draw checks.

I'm not happy that Carty the Criminal got $8 million, but let's not get carried away. Your pension was 96% funded on 12/31/07, a much higher percentage than the SERP.

I am not sure I am in error, as you say, but we certainly can disagree on "in part", "help pay the pensions", and other cavils and quibbles. And, your statement that my pension was better-funded than the SERP does not address my point of the SERP being bankruptcy-proof. Additionally, the 96% funded is a sop. Nobody really accepts that kind of creative accounting legerdemain.

I stand by my post that, saving the PBGC, our pension can be ravaged, even eliminated. The reason the suits voted themselves a SERP was because they recognized that the standard AA pension could be looted, perhaps by them, even. Until we get our own bankruptcy-proof SERP, or a secure and complete PBGC coverage, our pension is not secure.

Your statements that this or that can't happen or we are partially protected is all pure conjecture, perhaps through an optimistic filter. We can learn from what has already happened at other employers to make our own projections, as well.

I do not share your confidence in our employer, the courts or our government.

That said, things look better than they did before October of 2005, when bankruptcy got a little more difficult for big corporations. I was stressing big time all during the month before.

 

[Boomer]

"...Whether that number (representing actual value of assets) was enough to fund the plans to 96% required some assumptions about rate of return (and, of course, future contributions by the company), among others, like ages of empoyees, assumed date of retirements, etc..."

"...To be clear - the $9.1 billion is the value of the existing plan assets at the end of last year. The 96% funded number is variable-dependent..."

How "variable-dependant," are those that trusted AMR Accounting, and their "smoothing," techniques for those employees that trusted AMR to choose whatever means necessary in fulfillment of those promises?

 

[BoeingBoy]

About as "variable dependent" as those at other carriers and companies that have had their DB pensions terminated/frozen. Not to be cold hearted, but anyone who thought that their pension was exempt from any risk of disappearing has been living in a fantasy world for the last decade or longer.

Jim

 

[aapitbull]

About as "variable dependent" as those at other carriers and companies that have had their DB pensions terminated/frozen. Not to be cold hearted, but anyone who thought that their pension was exempt from any risk of disappearing has been living in a fantasy world for the last decade or longer.

Jim

AMEN!

 

[Buck]

AMEN!

I wonder if the negotiators thought about the pension in that way.

If the pension loss is a given, then maybe it could've been used as a bargaining chip?

 

[Buck]

The company has responded to the TWU on 2/17/2012. What are the details of the response?

I called Local 514 and they were not there, yes it is Sunday. The Line and TUL 1D are working, tomorrow President's Day the membership will work, perhaps I can call them Monday or Tuesday.

 

[2ndGENAMT]

The company has responded to the TWU on 2/17/2012. What are the details of the response?

I called Local 514 and they were not there, yes it is Sunday. The Line and TUL 1D are working, tomorrow President's Day the membership will work, perhaps I can call them Monday or Tuesday.

Responded to what??

 

[Buck]

Responded to what??

The phone call and possibly some information of the company response to the union.

Maybe a response to the early out?

 

[BoeingBoy]

I wonder if the negotiators thought about the pension in that way.

If the pension loss is a given, then maybe it could've been used as a bargaining chip?

While hindsight is always 20/20, if you're talking about negotiations last year prior to the bankruptcy filing and given what's happened with the rest of the legacy carriers at least a freeze could have been explored. That would have been better than termination for the older workers facing the PBGC maximum benefit and made no difference to the young workers who wouldn't get as much as the PBGC maximum anyway.

Back in 2003, the other legacies (except US pilots) hadn't had their plans terminated/frozen yet or costs reduced in bankruptcy so the environment was different.

Jim

 

[Buck]

While hindsight is always 20/20, if you're talking about negotiations last year prior to the bankruptcy filing and given what's happened with the rest of the legacy carriers at least a freeze could have been explored. That would have been better than termination for the older workers facing the PBGC maximum benefit and made no difference to the young workers who wouldn't get as much as the PBGC maximum anyway.

Back in 2003, the other legacies (except US pilots) hadn't had their plans terminated/frozen yet or costs reduced in bankruptcy so the environment was different.

Jim

Actually I am referring to the last T/A and even the current bankruptcy negotiations.

Possibly if the negotiators had this foresight a large number of jobs could be saved.

I have said it before, the 1.6667x, multipler for our pension in the company's words has kept the union from achieving wage par with the industry. Now that that roadblock is gone, there should be funding available for higher wages or the 5.5% 401k match.

The older I get the more I wish I had the option to freeze my pension say in 2003 and possibly fully fund my 401k.

 

[700UW]

At US in 1992 all non-union employees pensions were frozen.