Judge issues final ruling on retiree benefits.

[MetalMover]

http://aviationblog.dallasnews.com/2014/05/judge-issues-formal-order-on-health-benefits-for-american-airlines-retirees.html/

 

[dfw gen]

and the twu recommended that we voluntarily give it up! can we finally give up the twu?

 

[AANOTOK]

Mark my words...while I think it is wonderful the retirees are able to hold on to their benefits (as they should), AA will use that 10 million dollar monthly deficit as an excuse in any future contract negotiations...
 
On a secondary note, I was told today by a mid level elected rep that each individual (current employee) has their own trust fund for their now defunct retiree medical and it cannot be used to subsidize any arrangements the company and the TWU may come up with in light of this announcement. You will be getting it back...TAKE IT FOR WHAT IT'S WORTH!! I know, not much.

 

[MetalMover]

Makes you wonder what would have happened had the judge abrogated the labor agreements. Would the retiree medical issue been the exception?

 

[AANOTOK]

Makes you wonder what would have happened had the judge abrogated the labor agreements. Would the retiree medical issue been the exception?

No, because the union and their high powered lawyers said he was taken them away.

 

[WeAAsles]

The fat lady still hasn't sung on this issue yet. Read the last comment. The ball is in AA's hands now as to what it wants to do next???

 

[FWAAA]

Generally, decisions of bankruptcy judges are appealed to the District Court.    Losers there can generally appeal to the Court of Appeals.   Loses there can throw the Hail Mary and beg the US Supreme Court to hear their case, but that's a longshot.   
 
AA might appeal.   Dunno whether AA would be successful.   

 

[Bob Owens]

AA brings in roughly $3 billion a month, $10 million a month comes out to 0.3%. It's very little. One third of one percent. So for every $100 dollars,  33 pennies go to ensure that AA fulfills a commitment they made to people who spent most of their lives working for AA at reduced rates that were usually in excess of 3 cents and hour less  than their peers, with longer progressions to top rates, an  inferior pension, less vacation, less sick time etc etc. 
 
Look at it this way. If we were to pay AA what AA has to pay for the retirees for our health coverage it would cost us $21/year instead of over $3500. 
 
Do we really want to start comparing contracts to see where AA is getting off so much cheaper than any competitor out there? 
 
Give it up AA, you tried to cheat them out of Equity, now you have to pay. 
 
Now the next question, when do we get our checks from the Fund? 

 

[eolesen]

Are you certain you're still going to get the checks?

Seems to me that the ruling just rolled the clock back. If retiree health is being maintained, isn't there an argument the company can make keep their contributions in trust as they were originally intended to offset the cost of providing retiree healthcare?

 

[Vortilon]

Are you certain you're still going to get the checks?

Seems to me that the ruling just rolled the clock back. If retiree health is being maintained, isn't there an argument the company can make keep their contributions in trust as they were originally intended to offset the cost of providing retiree healthcare?

 
 
Well, what you're saying goes hand in hand with the way we have been used all along, if not by the company - then the union.  I don't feel like contributing the company match set aside for me, to fund the people who retired is fair.  Seems like the Judge  could have taken his ruling a little further, and said something like "the company will also refund to the active employees, their company match contributions".  If we have any representation at all, they would see to it that this would be the case.  The letter that Local 591s Gary Peterson recently posted regarding the ruling - along with a cut and paste Q & A from the APFA website doesn't really cover the $64K question either.  When do the active employees get their company match refunded to them?

 

[eolesen]

The company's contributions are already held in trust for the individual, so there's no legal basis for them to take that and fund others. It's held on your behalf, and yours only, to be untouched until you reach retirement age.

So again... if the benefits are being retained, why does anyone think they get the company's matching contributions back?

I wouldn't go do a Clark Griswold and put a down-payment on the pool just yet. The promises made in a letter between the two parties didn't envision a split decision (e.g. discontinuing pre-funding yet retaining the beneifts?...), and I'd guess that the employers contributions will remain in trust.

 

[AANOTOK]

The company's contributions are already held in trust for the individual, so there's no legal basis for them to take that and fund others. It's held on your behalf, and yours only, to be untouched until you reach retirement age.

So again... if the benefits are being retained, why does anyone think they get the company's matching contributions back?

 

The benefits are not "being retained" by me, the active employee. That was proven when AA distributed my prefunding back to me. And as you say, the match is in a individual trust in my name. Therefore, no retained benefit, no subsidizing current retirees with "my" trust, should mean a distribution of my match from AA.

 

[eolesen]

Ah, never mind. Brain fart... I was making the incorrect assumption that it was reinstating some form of future retiree health for actives.

If this ruling hasn't changed anything with regard to your retiree medical in the future, then yes, there's no point holding funds in trust for your use later.

That discussion keeps coming back to whether or not you're really entitled to the company's contributions or not.

 

[CMH_GSE]

Ah, never mind. Brain fart... I was making the incorrect assumption that it was reinstating some form of future retiree health for actives.If this ruling hasn't changed anything with regard to your retiree medical in the future, then yes, there's no point holding funds in trust for your use later.That discussion keeps coming back to whether or not you're really entitled to the company's contributions or not.

Well, ok, if we aren't entitled to the companies contributions that are in Our name only, then who would be?
This seems as simple as a JAX. Cut the checks and let's move on.

 

[eolesen]

Well, ok, if we aren't entitled to the companies contributions that are in Our name only, then who would be?

The bankruptcy estate?... They get first dibs on all assets not tied up otherwise, and if the stated purpose for the trust is being eliminated, then there could be a valid claim by the estate to hold onto those funds.

Had prefunding been changed over to VEBA like the UAW did with the Big Three, it would have been a little more cut and dry. But it didn't.