PBGC offers facts on AA

[usa1]

PBGC is getting ready to ask tax payers for a bailout.

 

[xUT]

Not at all - I agree that companies should be forced to honor their pension promises made to their employees and retirees. In part, that's why I was such a vocal proponent of denying a distress termination to US and UA. I posted here in 2002-05 that those airlines should have been liquidated rather than abandon their pension obligations. A side benefit would have been industry-wide consolidation, something that everyone seems to agree is necessary now, and on which I was banging the drum 7-10 years ago. Liquidation of US and UA would have made things better for everyone at DL, NW, CO and AA.

But since US and UA and then DL were allowed to walk away from their pilot pension obligations (reducing pensions already earned, for active and retired pilots), the hypocrite in me says, "well, AA is entitled to the same treatment the others were granted, and trying to preserve the pensions for almost nine extra years shouldn't place AA at a disadvantage." If US, UA and DL could walk away from their promises, it takes a lot of chutzpah for Josh at PBGC to argue so loudly that AA shouldn't be granted the same relief as its competitors (if that's what AA wants).

About my focus on pilots: It's not that I don't care about other workgroups. AFAIK, generally only pilots had pensions sufficiently large as to be reduced by the PBGC maximum, made worse by the former retirement age of 60 (which made for an even lower PBGC maximum payout).

After the UA Pilot driven EFLOP and Summer of 2000, my respect for their actions is quite diminished.
Unfortunately, they drug us with them.
B) xUT

 

[Buck]

Suppose the pension fund for the TWU-represnted employees is underfunded by several hundred million or perhaps a billion dollars? From where would that money come if the TWU took over the pension? The NYC bus and subway drivers? WN FAs? Increase dues charged to AA employees represented by the TWU?

Maybe the PAC's the TWU has given to will return the favor?

 

[strikeforce]

PBGC is getting ready to ask tax payers for a bailout.

The PBGC should point the finger back to people that allowed AA and other companies to defer funding.....i.e. Congress! I find it amazing the unions on the property allowed AA pensions to be underfunded by 10B. What the hell have they been doing all these years?????

 

[tech2101]

If US, UA and DL could walk away from their promises, it takes a lot of chutzpah for Josh at PBGC to argue so loudly that AA shouldn't be granted the same relief as its competitors (if that's what AA wants).

Well "Josh" was not the Director of the PBGC during those times.

It is never too late to do the right thing.

 

[700UW]

The PBGC received all the money in those said pensions and received stock equivalents of the deficits of the pension funds.

 

[BoeingBoy]

The warrant's value would depend on the particulars.

Jim

 

[MCI transplant]

The PBGC should point the finger back to people that allowed AA and other companies to defer funding.....i.e. Congress! I find it amazing the unions on the property allowed AA pensions to be underfunded by 10B. What the hell have they been doing all these years?????

--------- Collecting dues!

 

[Buck]

--------- Collecting dues!

Working Together?

 

[Boomer]

Please Read Docket # 618

It appears that the PBGC doesn't want to buy a, "pig-in-a-poke," and wants the opportunity to conduct a forensic audit, LINK PROVIDED: FORENSIC ACCOUNTING, of the pension plans sponsored by American Airlines to the Pilots, Flight Attendendants, the TWU and Management.

Will the TWU International also demand the same treatment?

I think we know that the PBGC number is high based on what they have received in contributions versus what they expect to pay: but, I also suspect that the numbers AMR is using are really lower than what they have promised.

The PBGC wants the funding information by employee job code: shouldn't that same information be requested by the TWU as Owner of all the AA contracts?

Would failure to demand the same information the PBGC requests, by the TWU, result in a DFR, failure to represent?

 

[Buck]

Pension-Related Notifications
American also notified the PBGC of three decisions made concerning its defined benefit plans.
Pension Funding Requirement - American informed the PBGC that it will contribute $6.5 million to its defined benefit plans, effective today.
Pension Funding Relief - American informed the PBGC that it has elected pension funding relief for 2009 and 2011 for retirement benefit plans for Agent, Management, Specialist, Support Personnel and Officers; TWU-represented employees; and flight attendants. The pension funding relief has also been elected for the pilots? Fixed Income Plan for 2010 and 2011.
Independent Fiduciary - An independent fiduciary is being appointed to act for the Pension Plans in the chapter 11 restructuring.

A company's Chapter 11 reorganization does not necessarily mean that its pension plan will be terminated, although that is a possible outcome.

Given American's plans to reduce its costs to a more reasonable level in line with industry norms, these costs, and many other factors, are considerations when deciding whether to continue the pension plans.

The Internal Revenue Code has established minimum funding requirements for defined benefit plans. In 2011, AMR contributed approximately $520 million to our pension plans.

As a result, American will contribute $6.5 million to its defined benefit plans to cover the period Nov. 29 - Dec. 31, 2011.

An independent fiduciary is being appointed to act for American's four defined benefit pension plans in the Chapter 11 restructuring.

 

[Maark767]

Pension-Related Notifications
American also notified the PBGC of three decisions made concerning its defined benefit plans.
Pension Funding Requirement - American informed the PBGC that it will contribute $6.5 million to its defined benefit plans, effective today.
Pension Funding Relief - American informed the PBGC that it has elected pension funding relief for 2009 and 2011 for retirement benefit plans for Agent, Management, Specialist, Support Personnel and Officers; TWU-represented employees; and flight attendants. The pension funding relief has also been elected for the pilots? Fixed Income Plan for 2010 and 2011.
Independent Fiduciary - An independent fiduciary is being appointed to act for the Pension Plans in the chapter 11 restructuring.

A company's Chapter 11 reorganization does not necessarily mean that its pension plan will be terminated, although that is a possible outcome.

Given American's plans to reduce its costs to a more reasonable level in line with industry norms, these costs, and many other factors, are considerations when deciding whether to continue the pension plans.

The Internal Revenue Code has established minimum funding requirements for defined benefit plans. In 2011, AMR contributed approximately $520 million to our pension plans.

As a result, American will contribute $6.5 million to its defined benefit plans to cover the period Nov. 29 - Dec. 31, 2011.

An independent fiduciary is being appointed to act for American's four defined benefit pension plans in the Chapter 11 restructuring.

Wonder if there is a chance we will retain our DB pensions. Maybe we will!!!

 

[midnights]

Wonder if there is a chance we will retain our DB pensions. Maybe we will!!!

Same chance as Horton taken a paycut like the rest of us!

 

[Maark767]

Same chance as Horton taken a paycut like the rest of us!

Looks like the PBGC isn't going to make it easy for AMR.

 

[Buck]

Looks like the PBGC isn't going to make it easy for AMR.

I thought this might be an attempt to "fully fund" the pensions to make it more difficult for the PBGC to refuse the pension?