Originally Posted by
Bucking Bar
Another way to explain this is:
Day one Min Balance in a MBCBP, $300,000
Day two, someone retires with $300,000 having contributed nothing - company pays all
15th of the month, after 401K is full, pilots' excess is routed into the MBCBP
Pilot retires the second year after the contract - they get $300,000 but $290,000 was funded by the company and $10,000 funded by the pilot's excess which is routed into the MBCBP
Pilot retires seven years from now. They get the $300,000 but it has been completely funded by their own excess, and so on, company contributes $0.
Easy to explain with a chart, but basically pilots retiring soonest gain the greatest benefit since they had no time to contribute their excess. In other words, they've been enjoying eating their cake and will get a cake too. Those who retire later get to bake their own cake and take it with them.
I would prefer not to ascribe motives to what the MEC is trying to do here. Obviously, the Min Balance only benefits those soon to retire. Any idea that junior pilots are "selfish" for not wanting to divert half a billion $ or so misses the mark. Any notion that senior pilots are "greedy" for wanting the security of more $ for an uncertain retirement also misses the mark. Assume everyone has unlimited greed. Also assume everyone is the head of a household with a family to support and nobody knows what this industry or the equities market (in whatever you invest in) is going to do.
It is beyond silly that some senior pilots are on here stating they negotiated DC for junior pilots, ha! They negotiated DC because it benefitted all pilots equally and at that time they were mid-seniority and mid-career, when EQUAL across the board seemed like a good idea.
My forecast is that After Thanksgiving when the decision makers are at the table the Negotiators will be given a bag of cash & the problem of how to allocate that cash across pay rates and min balance. They will take that problem to the MEC and get direction. The MEC will demand both. To get a deal done the thing will have to be allocated.
The company has no specific objection to a min balance, in fact, they likely don't care. They'll pull it from pay and let the MEC Reps fight it out.
Pay rates are better for the industry and for future pattern bargaining, JMHO.
Every once in awhile there is a gold nugget to be found on this board. This is exactly how it will go down. While I have an opinion as to whether the MB concept is sound and whether it will be adopted, nobody wants to hear it unless in the unlikely case my opinion matches their own. It either will be adopted or it won’t. Whether it is and to what degree is an economic question and not one of what’s right or fair.