Report: US Airways to terminate ALPA pension today

[diogenes]

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On 1/28/2003 9:05:10 AM Cosmo wrote:

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On 1/28/2003 7:24:03 AM mrplanes wrote:

If he committed to it then, why does he not want to commit to it now.
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[/blockquote]
Aren't you leaving out one little detail? The US-ALPA agreement was predicated on the aggressive assumption that the PBGC would approve a 30-year payment schedule of the pension plan underfunding which, as we all now know, did not happen. While US management must take a share of the blame that the pension funding plan was not approved (and a large share if it was their idea), ALPA must take at least some of the blame as well. After all, where was ALPA's financial advisor when this risky assumption was being discussed and agreed to?

In the end, the fact remains that the pilot's pension plan is underfunded by approximately $2 billion. Even if we assume that all of the other employees' pension plans have been terminated, that $2 billion liability still exists. Given that a legislative change to the ERISA law is unlikely, and thus the PBGC's 7-year payment schedule must still be adhered to (meaning an average annual payment of almost $300 million), what course of action would you suggest that would enable US to avoid terminating the pilots' pension plan?
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[/blockquote]


Cosmo,

You're getting into an area that has baffled me from the jump.

The PBGC, management and ALPA all sat on the secured creditor's committee. How could a proposal have been brought out of committee, presumably with the members' blessing, only to have it dead on arrival, killed by one of the members that negotiated it?

I'm confused!

 

[RowUnderDCA]

Washington Post (1-29-03)


"US Airways executives have said the agency (PBGC) would not allow them (U) to terminate the pension funds of its flight attendants and machinists because the pilots' plan represents 70 percent of the unfunded liabilities.
Jeff Zack, a spokesman for US Airways flight attendants, said the airline did not need to seek relief from other employee groups because only the pilots' fund was significantly underfunded.
"Our pensions aren't nearly as expensive," Zack said. "Our pensions just aren't that high. They haven't been a problem.""

Hasn't everyone of the insiders known this all along? The problem is 'no money' and 'no time.'

I seems to me that 'terminating' the other pension plans has always been a red herring. Agreed- PBGC logic is a bit through the looking-glass, because their mandate is not to protect the individual pensioner completely, but to maintain a system that protects the economy from the large numbers of destitute pensioners.

The only answer is either more money or more time. If all the unions want to cash balance their plans (if that is even possible) and negotiate as much from U as supplemental refunding to protect the near term retirees, that's the only way you'll be able to preserve any upside above PBGC minimums. I don't think the fa and mechs have any motivation (other than to avoid chap 7) because they don't benefit from payouts that exceed the PBGC minimums, right?

 

[autofixer]

According to ALPA, the AFA and IAM pension plans have become, "much, much more expensive(since the TAs were passed, while ALPA's plan cost have remained constent)." The company WILL be coming for them shortly. So don't think you do not have a vested interest in what happens to the pilots...you do!

 

[Cosmo]

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On 1/29/2003 726 AM diogenes wrote:

The PBGC, management and ALPA all sat on the secured creditor's committee. How could a proposal have been brought out of committee, presumably with the members' blessing, only to have it dead on arrival, killed by one of the members that negotiated it?
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[/blockquote]
This is precisely the point that I have been trying to make (and to be honest, you did it more eloquently)! ALPA has been in on these pension plan discussions from the very beginning, and only NOW, as the bankruptcy reorganization of US finally appears to be on the verge of success, it's a problem? Clearly, ALPA has either been dishonest with its members or (together with its financial advisor) has been extremely stupid, or possibly both. These possibilities hardly reflect well on the union.

So while there is lots of blame to go around, and while I also understand the anger of individual pilots, I think the pilots need to recognize that some of the blame for their current situation must be directed at their own union.

And BTW, nobody has answered my question about what US should do to avoid terminating the pilots' pension plan given the approximately $2 billion underfunding in that plan alone. Even if the other pension plans are terminated, the pilots' plan still has a huge liability to overcome and there apparently will not be a legislative "fix" to the problem. So put yourself in Dave's shoes for a moment and suggest the appropriate course of action for US to take (and I'm looking for more detail than simply a "stick to his commitment" answer).

 

[PITbull]

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On 1/28/2003 6:42:39 PM copilot wrote:

At 41 years of age, 16 years employed at CO, I along with other crew members find your Airlines pension crisis of great concern. My best wishes to its outcome.

I can only give my impression as a outsider in this enviroment. Depending on the dollar amount vested, and that amount that could be retrieved, I'd get the heck out of there while the "getten" is good.

I also belive that someone above is "right on" that this could spread across the industry with Chap.11 BK. Next thing you no a Pension Plan won't even be part of a compensation package.
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You would know...thanks for the support.

 

[PITbull]

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On 1/29/2003 11:06:11 AM Cosmo wrote:

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On 1/29/2003 726 AM diogenes wrote:

The PBGC, management and ALPA all sat on the secured creditor's committee. How could a proposal have been brought out of committee, presumably with the members' blessing, only to have it dead on arrival, killed by one of the members that negotiated it?
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[/blockquote]
This is precisely the point that I have been trying to make (and to be honest, you did it more eloquently)! ALPA has been in on these pension plan discussions from the very beginning, and only NOW, as the bankruptcy reorganization of US finally appears to be on the verge of success, it's a problem? Clearly, ALPA has either been dishonest with its members or (together with its financial advisor) has been extremely stupid, or possibly both. These possibilities hardly reflect well on the union.

So while there is lots of blame to go around, and while I also understand the anger of individual pilots, I think the pilots need to recognize that some of the blame for their current situation must be directed at their own union.

And BTW, nobody has answered my question about what US should do to avoid terminating the pilots' pension plan given the approximately $2 billion underfunding in that plan alone. Even if the other pension plans are terminated, the pilots' plan still has a huge liability to overcome and there apparently will not be a legislative "fix" to the problem. So put yourself in Dave's shoes for a moment and suggest the appropriate course of action for US to take (and I'm looking for more detail than simply a "stick to his commitment" answer).
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[/blockquote]


Hey Cosmos, have you seen "Real World"???


I would like to make a comment about the pension plan termination possiblity, if management does this, promise I will be at managements throats in 2004 when they walk off with a bonus! Management suckered us into the PPO medical, and what they didn't get this summer, they got this go round, with their final "trump card" of "liquidation". Pilots already gave management a solution when they changed the multiplier and the FAEs and gave back upteen dollars.

Slightest change in the economy on the upside between now and next year and going forward...changes everything.

 

[BottomFeeder]

[blockquote]
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On 1/29/2003 11:06:11 AM Cosmo wrote:

[blockquote]
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On 1/29/2003 726 AM diogenes wrote:

The PBGC, management and ALPA all sat on the secured creditor's committee. How could a proposal have been brought out of committee, presumably with the members' blessing, only to have it dead on arrival, killed by one of the members that negotiated it?
----------------
[/blockquote]
This is precisely the point that I have been trying to make (and to be honest, you did it more eloquently)! ALPA has been in on these pension plan discussions from the very beginning, and only NOW, as the bankruptcy reorganization of US finally appears to be on the verge of success, it's a problem? Clearly, ALPA has either been dishonest with its members or (together with its financial advisor) has been extremely stupid, or possibly both. These possibilities hardly reflect well on the union.

So while there is lots of blame to go around, and while I also understand the anger of individual pilots, I think the pilots need to recognize that some of the blame for their current situation must be directed at their own union.

And BTW, nobody has answered my question about what US should do to avoid terminating the pilots' pension plan given the approximately $2 billion underfunding in that plan alone. Even if the other pension plans are terminated, the pilots' plan still has a huge liability to overcome and there apparently will not be a legislative "fix" to the problem. So put yourself in Dave's shoes for a moment and suggest the appropriate course of action for US to take (and I'm looking for more detail than simply a "stick to his commitment" answer).
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Cosmos,


It is interesting how the management of this company has asked all to SHARE the pain. Now it seem the SHARING has stopped. The management will have their GOLDEN parachutes and BONUS it the near future. Not to mention the aprox. 8% of the new stock. OH, I forgot to mention a PENSION as well. Most will get a full topped out pension for a few years of service.

The fat lady has not sung yet. I would bet the ALPA boys and girls will dance like a butterfly and sting like a bee.

Sad that Dave is not being a TRUSTWORTHY man. His statements and actions speak louder than than his LIES.

 

[PITbull]

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On 1/29/2003 8:36:03 AM RowUnderDCA wrote:

Washington Post (1-29-03)


"US Airways executives have said the agency (PBGC) would not allow them (U) to terminate the pension funds of its flight attendants and machinists because the pilots' plan represents 70 percent of the unfunded liabilities.
Jeff Zack, a spokesman for US Airways flight attendants, said the airline did not need to seek relief from other employee groups because only the pilots' fund was significantly underfunded.
"Our pensions aren't nearly as expensive," Zack said. "Our pensions just aren't that high. They haven't been a problem.""

Hasn't everyone of the insiders known this all along? The problem is 'no money' and 'no time.'

I seems to me that 'terminating' the other pension plans has always been a red herring. Agreed- PBGC logic is a bit through the looking-glass, because their mandate is not to protect the individual pensioner completely, but to maintain a system that protects the economy from the large numbers of destitute pensioners.

The only answer is either more money or more time. If all the unions want to cash balance their plans (if that is even possible) and negotiate as much from U as supplemental refunding to protect the near term retirees, that's the only way you'll be able to preserve any upside above PBGC minimums. I don't think the fa and mechs have any motivation (other than to avoid chap 7) because they don't benefit from payouts that exceed the PBGC minimums, right?






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Row,

You are correct! AFA is not interested in a "cash balance" plan, it serverely disenfranchises the middle-aged workers. This plan is based on notational entries.

 

[Hubturn]

I hoped and believed that this airline would turn around. It appeared that management was making necessary cuts to survive. However, the latest pension negotion has a different flavor. Dave and cronies fully believe that the company will come out of bankruptcy. Their tactic has turned from survival to get all they can. They believe the pilots will give in to this latest proposal since a pretty good paycheck is better than no paycheck. As soon as we come out of bankruptcy, they will come after wages. That is why in the previous round they did not want money and Alpa had to work a deal to give money to save jobs. With the assumption that money is next on their list, I now, for the FIRST time, believe that maybe it will be better to let it go under. That's not vengence speaking, either. It will be too tempting to continue doing what I love, versus quitting, in the hope that it will get better. I don't want the option to scab either, as Dave will next be hanging that over our heads that there are plenty of furloughed guys out there willing to take our jobs. An 80-90K job with a check mark in a book saying I'll get a retirement someday without assets to back it up just won't cut it. Better to end it now without a chance to look back and get on with a new, yes, lower paying career. So I have come around to the opinion of those that it's better to stand now and come up with a reasonable solution or end it. The PBGC minimum of $1380 (I'm 48) is mine no matter what the company does. So Dave and cronies, if you're reading this board, the LAST guy that would tell you to shove it just did.

 

[PITbull]

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On 1/29/2003 2:25:55 PM Hubturn wrote:

I hoped and believed that this airline would turn around. It appeared that management was making necessary cuts to survive. However, the latest pension negotion has a different flavor. Dave and cronies fully believe that the company will come out of bankruptcy. Their tactic has turned from survival to get all they can. They believe the pilots will give in to this latest proposal since a pretty good paycheck is better than no paycheck. As soon as we come out of bankruptcy, they will come after wages. That is why in the previous round they did not want money and Alpa had to work a deal to give money to save jobs. With the assumption that money is next on their list, I now, for the FIRST time, believe that maybe it will be better to let it go under. That's not vengence speaking, either. It will be too tempting to continue doing what I love, versus quitting, in the hope that it will get better. I don't want the option to scab either, as Dave will next be hanging that over our heads that there are plenty of furloughed guys out there willing to take our jobs. An 80-90K job with a check mark in a book saying I'll get a retirement someday without assets to back it up just won't cut it. Better to end it now without a chance to look back and get on with a new, yes, lower paying career. So I have come around to the opinion of those that it's better to stand now and come up with a reasonable solution or end it. The PBGC minimum of $1380 (I'm 48) is mine no matter what the company does. So Dave and cronies, if you're reading this board, the LAST guy that would tell you to shove it just did. [img src='http://www.usaviation.com/idealbb/images/smilies/8.gif']
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I feel the same way. They have stripped the employees of every valued benefit and protection there has been for all of us. I have been way over this management for months....I don't believe the company, with all that has been given, from all of labor, needs to address anyones pension at this point.

 

[CaptChill]

MR...

Amen!... United we stand!

CaptChill