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Old 12-04-2010 | 08:47 AM
  #3239  
sailingfun
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Originally Posted by Wasatch Phantom
Sailing,

I thought of this after my earlier post, but I was out snowmobiling and didn't have access to a computer or Internet.

IIRC the pilots who took the early retirement got some significant medical benefits. I don't remember what it was, but I do recall it was a good deal, and was reason alone to take the incentive.

Some guys did get a huge windfall. I'll explain, but first a little background for those who came along after we lost our DB plan.

A full retirement from Delta was equal to 60% Final Average Earnings. To get a "full" retirement the pilot had to retire at 60 years of age and have a minimum of 25 years of Delta service.

As Sailing pointed out, the 505 who took the early retirement incentive were pretty senior dudes. I don't know the demographics of the 505, but I do know that not all were originally hired by Delta. Within the 505 there were a fair number who were former Western Air Lines pilots and former Pan Am pilots.

In the case of Western I believe that merger happened in 1986. Delta acquired Pan Am in 1991. An acquired pilot would typically retire at 60, but they wouldn't have the 25 years so their retirement was calculated as a percentage. For example a Pan Am pilot retiring in 1996 would have 5 years of longevity. His retirement would be 5/25 of 60% FAE.

Similarly a Western pilot would have 10/25 of 60% FAE.

So in the case of a former Pan Am pilot who took the "early retirement", he had five years added on to his longevity. Instead of 5/25 of 60% FAE, he got 10/25 of 60% FAE. That's literally twice the retirement he would have received without the early retirement incentive.

I call that a "huge benefit", and I would think the vast majority of pilots would as well.

I forgot about the Pan Am and Western pilots. I would bet however that out of the 505 well under 100 were former Pan Am or Western. Some may have been Western but the bulk of the Pan Am guys would not have made the cut with the seniority numbers they had. In addition in that time frame very few Western or Pan Am guys retired. They choose door number 3 which was to go out on disability which paid 50 percent of FAE plus whatever retirement they had from Pan Am or Western.
That disability concept is going to return big time in the next few years as pilots who don't want to work to 65 realize how much better off they will be on disability.
The medical you mentioned was that the company paid their medical to age 60. The normal contract provided medical for everyone at age 60 retirement. Their only benefit was paid medical for the time period from actual retirement to age 60.
Keep in mind the entire program was conceived to put the furloughed pilots back to work and mitigate the job losses from the major vacation changes made in the 96 contract.
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