FDX Mediation and Retirement Timing
 

I've heard recently that part of the reason FDX mgt filed for mediation suddenly is that under mediation any person contemplating retirement must give 60 days notice. The previous rule was 30 days notice if you wanted your retirement check to start the 1st of the next month otherwise tell them today, retire today. It passes the smell test since if this is true, they protect themselves from a mass exodus of guys in December.

Can any retirement experts verify? I know the Company has published the numbers of 400 guys over 60 and another 400 guys 55+ with 25 years. That's a potential for 800 guys to sing Jonnie Paycheck's song...."take this job and shove it."

They might "protect themselves from a mass exodus of guys", but if what you mention is true, it still won't protect management from guys giving them 60 days retirement notice, then calling in sick for, oh a month or so. Just a thought.

You can quite/retire anytime you want. If you want a pension check the month after you quite you need to give aon two months to calculate your benefits. If you don't give aon time to calculate/process your pension, your first check will not be the following month. You will be paid everything your owed, just maybe two checks at once. Nothing has changed in mediation.

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You pay lots of good money to ALPA and we have lots of experts on retainer to answer such questions :) Call the folks at the ALPA office or send an email and I am confident you will get a quick reply.

This is true, but I think hoping for a mass exodus due to a new contract/no new contract is wishful thinking. Like the "international mail contract" talk 2004-2006, or "a bunch of guys will just retire" when we faced 4a2b, we have always had a career El Dorado just beyond the horizon.

Here's the cold hard facts.

FedEx is in a cost cutting mode. We are not expanding our product line (much) at the moment, but instead seeking a higher rate of ROI and ROC. Like Gary Kelly's 15% ROI target at Southwest, some of the easiest targets for cost reductions are employee salary and benefits and reduction in services. We are seeing the former, and the latter is often burning the furniture to heat the house. I am hopeful we do not destroy enough furniture that our company loses its magic appeal with the customer, but anecdotally we've all heard some no so good stories the last few years.

Most pilots will work until 65. Why? Paying for insurance out of 1/2 of what you used to make doesn't appeal to many of our pilots.

Our culture does not allow good faith negotiations with a pilot union. Our union decided to step back from old school negotiations and open another door to try a new approach. That door was again slammed in our face, while management at other companies reached for the olive branch and signed contracts before the amenable dates (Delta and Alaska). Therefore, hoping to see any kind of win/win incentive at this point in regard to allowing pilots to leave but keeping a portion of their sick bank, etc in exchange for setting a date is unlikely. A side result is many of our pilots realize they now have 686 hours of use/lose sick leave to burn before they retire, and many have decided to stay and burn it over their last 2-3 years. The net result is they get to burn leave at the highest pay rate of their careers and enjoy a lot of days of towards the twilight of their careers. If they face discipline or it gets to be too much of a hassle…THEN retire…but until then keep the family doctor busy writing notes and burn off every last hour. Keep that 72 hour Paris layover, but sick the YMX hub turns…and ride that pony until the day.

Some pilots will leave early. I would not base my progression here or select this company if I was offered a job based on rapid advancement. Look at the charts, add 10% for early retirements, medical outs, and (sadly) a few deaths and I think you'll have a reasonable estimate. Anything else is just daydreaming.

Try 1/3 of what you where making, when Obama's cadillac tax on our health insurance is due to kick in..

The Cadillac tax is on the company, not the employer.

So if you are negotiating compensation with your employees do you factor it in?

Regardless of the tax do you expect insurance to rise for the self insured making 100k + over the next 5 years. If planning to retire should it be a factor?

If there was ever a time to create an incentive to retire, it was during the 4a2b era. In this era of guys quitting (yes….I said quitting, not going somewhere else just flat out quitting) FedEx or migrating to other carriers, I think keeping pilots around is more in their plan. A captain on the payroll makes what an FO on draft makes, so considering the amount of draft being offered now to FOs having the extra bodies does not seem to be an "extra" cost. Our training shop is struggling with the 767 program, so every guy you keep is one less you have to train.

I also don't see why anyone would offer increased insurance benefits to retirees, if I wanted to keep them around to work. Our union's goal is to reduce any impediments to retire, ergo management's goal will be to create or keep as many as they can. The Cadillac tax is designed to penalize employers who offer too good of an insurance plan, meaning our own government wants us to either A) pay more for insurance or B) accept less coverage. Neither encourages a 60 year old off the property.

Which is why I have a monthly deduction to help pay for old guy health care. Guys that don't leave until 65.