Fedex Pilots proposed retirement plan
11-11-2017, 06:01 AM
#561
Line Holder
Joined APC: Sep 2006
Posts: 62
Originally Posted by UnskilledFXer
Fellow pilots are you reading the information available? Who is guaranteed more in retirement if a new plan is put into place? Who assumes the risk? Why now, instead of next contract?
Who is guaranteed gains? Pilots with 25 years of service and a maximum high 5 earnings. Watch the MEC video where the MEC Chairman states we must do something to provide for those retiring who have already maxed out their retirements, it is a “moral obligation”.
Who pays for this increase? Certainly not Fedex. Fedex has already proven, many times, they give nothing away. So where does it come from? It is not hard to figure out. Any change in current retirement benefits prior to the implementation of a new contract will result in significant cost savings to Fedex. Unfulfilled gains in high 5 averages and longevity toward retirement are voluntarily frozen, an Accumulated Benefit Option (ABO) is then calculated. It has already been demonstrated in a previous post that accumulated retirement benefits will increase substantially for most individuals, if thing are simply not changed prior to next contract. Second, payments into a new plan, according to Variable Benefit Consultants, will almost never be underfunded, so monies now paid, or future penalties, if incurred, in the form of variable rate premiums to the PBGC are negated. These penalties are set to increase substantially. Investment risk is now transferred from Fedex to the individual pilot and retiree. How much is that worth?
Examples set forth by proponents of these plans demonstrates significant fluctuations in retirement income due to plan performance. A link to soa.org in a previous post shows a difference of 48% in retirement payout volatility , for the same estimated value, due to timing. To paraphrase, an 2003 retiree with an estimated $1000 monthly benefit received the following, 2008 $1358, 2009 $966 and 2012 $1121. Conversely, a person retiring in 2008 with the same $1000 monthly benefit received the following, 2009 $711 and in 2012. $825. So if you base your retirement on $10000 a month, can you accept $7100 in the hopes that you might make $13580? Also notice an individual who retired 5 years earlier than you, with the same estimated benefit is making 27% more than you in 2012. One must very aware that many groups under these plans have no regulated retirement age and can elect to work through market turmoil. For us, the merry go round stops at 65, good or bad economy.
A previous poster referred to the PowerPoint presentation and referenced how risk was pictorially depicted, it was particularly telling, when the company assumes risk, it is large and burdensome, but when we as pilots assume risk it is small and balanced. Doesn’t seem that way in the previous paragraph.
This needs to be stopped, Fedex estimates approximately 780 pilot will reach the regulated retirement age by the end of 2022, an optimistic date for a new contract to be ratified. Is it really necessary that 4000 pilots put their retirement security in jeopardy to finance an even greater benefit to the most financially rewarded group of pilots to ever work at Fedex.
Who is guaranteed gains? Pilots with 25 years of service and a maximum high 5 earnings. Watch the MEC video where the MEC Chairman states we must do something to provide for those retiring who have already maxed out their retirements, it is a “moral obligation”.
Who pays for this increase? Certainly not Fedex. Fedex has already proven, many times, they give nothing away. So where does it come from? It is not hard to figure out. Any change in current retirement benefits prior to the implementation of a new contract will result in significant cost savings to Fedex. Unfulfilled gains in high 5 averages and longevity toward retirement are voluntarily frozen, an Accumulated Benefit Option (ABO) is then calculated. It has already been demonstrated in a previous post that accumulated retirement benefits will increase substantially for most individuals, if thing are simply not changed prior to next contract. Second, payments into a new plan, according to Variable Benefit Consultants, will almost never be underfunded, so monies now paid, or future penalties, if incurred, in the form of variable rate premiums to the PBGC are negated. These penalties are set to increase substantially. Investment risk is now transferred from Fedex to the individual pilot and retiree. How much is that worth?
Examples set forth by proponents of these plans demonstrates significant fluctuations in retirement income due to plan performance. A link to soa.org in a previous post shows a difference of 48% in retirement payout volatility , for the same estimated value, due to timing. To paraphrase, an 2003 retiree with an estimated $1000 monthly benefit received the following, 2008 $1358, 2009 $966 and 2012 $1121. Conversely, a person retiring in 2008 with the same $1000 monthly benefit received the following, 2009 $711 and in 2012. $825. So if you base your retirement on $10000 a month, can you accept $7100 in the hopes that you might make $13580? Also notice an individual who retired 5 years earlier than you, with the same estimated benefit is making 27% more than you in 2012. One must very aware that many groups under these plans have no regulated retirement age and can elect to work through market turmoil. For us, the merry go round stops at 65, good or bad economy.
A previous poster referred to the PowerPoint presentation and referenced how risk was pictorially depicted, it was particularly telling, when the company assumes risk, it is large and burdensome, but when we as pilots assume risk it is small and balanced. Doesn’t seem that way in the previous paragraph.
This needs to be stopped, Fedex estimates approximately 780 pilot will reach the regulated retirement age by the end of 2022, an optimistic date for a new contract to be ratified. Is it really necessary that 4000 pilots put their retirement security in jeopardy to finance an even greater benefit to the most financially rewarded group of pilots to ever work at Fedex.
11-11-2017, 06:32 AM
#562
Gets Weekends Off
Joined APC: Nov 2016
Posts: 936
Originally Posted by mcdbirdman
Well said “Let’s screw those mean old 780 pilots for the rest of their lives so we can negotiate more for us(the good pilots) next contract.” That’s the ticket! Next time you fly with one of those faceless Captains that are just after YOUR money let them know how you feel.
11-11-2017, 07:03 AM
#563
Line Holder
Joined APC: Sep 2006
Posts: 62
Originally Posted by Fdxlag2
As opposed to the Union’s let’s screw those pilots who will never hit 25 to help out the indigent 35 year WB captain? There is a pool of A Fund money available, it is now split up over the first 25 years. If we change the rules to split it up over the first 35 years there will certainly be winners and losers.
11-11-2017, 07:13 AM
#564
Gets Weekends Off
Joined APC: Nov 2013
Posts: 2,756
Originally Posted by UnskilledFXer
Examples set forth by proponents of these plans demonstrates significant fluctuations in retirement income due to plan performance. A link to soa.org in a previous post shows a difference of 48% in retirement payout volatility , for the same estimated value, due to timing. To paraphrase, an 2003 retiree with an estimated $1000 monthly benefit received the following, 2008 $1358, 2009 $966 and 2012 $1121. Conversely, a person retiring in 2008 with the same $1000 monthly benefit received the following, 2009 $711 and in 2012. $825. So if you base your retirement on $10000 a month, can you accept $7100 in the hopes that you might make $13580? Also notice an individual who retired 5 years earlier than you, with the same estimated benefit is making 27% more than you in 2012. One must very aware that many groups under these plans have no regulated retirement age and can elect to work through market turmoil. For us, the merry go round stops at 65, good or bad economy.
You retire a year too soon, because nobody knows what the market will do, and you see your retirement check far below someone who waited. Or you wait too long and the market crashes. Or you have to retire at age 65 and get stuck with whatever it is at the time. This is crazy, and will encourage people to push for later (or no) mandatory retirement age so they can wait out the market. Get your walkers ready.
No wonder we aren't getting the specifics on this plan yet. If this is all incorrect information people are passing on, get it out there. Until then, it's going to be speculation based upon what we have received so far. Let's see the presentation the company received. Let's see what our reps have witnessed.
11-11-2017, 07:38 AM
#565
Gets Weekends Off
Joined APC: Aug 2006
Posts: 1,820
Originally Posted by mcdbirdman
Keep it coming guys. Let’s show those rich 35 year WB captains who’s the boss. Don’t listen to any argument or discussion about a dying A fund. Just get those guys. Our 130K will be just fine 20 years from now.
I ran the numbers based on market performance for a pilot that got hired at age 50 in 2001 and retired in 2016. Under our current plan, he would make 30% of 260K or $78K per year for life. If he assumed the risk based on market performance during that time, that benefit would have dropped to $44K for life based on buying a lifetime annuity with the cash balance. So yeah, let's help the 35 year WB captain who stayed until age 65 so that the guy who can only work for 15 years takes a $34K a year bath.
11-11-2017, 07:45 AM
#566
Gets Weekends Off
Joined APC: Jul 2007
Position: 767 Captain
Posts: 3,988
Originally Posted by mcdbirdman
Well said “Let’s screw those mean old 780 pilots for the rest of their lives so we can negotiate more for us(the good pilots) next contract.” That’s the ticket! Next time you fly with one of those faceless Captains that are just after YOUR money let them know how you feel.
When the MEC chairman starts declaring "moral obligations" or what is "the right thing to do" (
a blast from the past), my BS meter pegs. If this process being considered fails and retirees leave between now and 2021 with our current retirement plan, I'm not going to feel ANY failure of morality - individually or collectively. How many of those 780 (MEC chair included) voted yes on this contract, supposedly agreeing to what now has suddenly become a morality check? YGBSM!! Retirement in this industry is hardly a surprise. Hopefully all the folks approaching that milestone have done their due diligence and are ready. Thankfully, at our company, the losses in retirement experienced by many pax pilot late in their careers didn't happen. What the soon to be retired have planned on for their career will be there. Hell, thanks to the last MEC pang of morality, many got an extra five years they weren't expecting. Most, after decades on WB captain pay, a $130K A-plan and most likely millions in their B-plan will be juuuuuust fine. Characterizing junior pilot's reluctance to embrace this effort as "screwing those mean old pilots for the rest of their lives" is a bit of a stretch.
Yeah, we keep bringing up the diminishing value of the A-plan over time. However, right now in 2017, $130K per year is still a worthy amount. It's also what the "yes" voters two years ago who will soon retire agreed to. CD will have to excuse me if I'm not feeling his "moral obligation" quite as strongly as he is.The company stands to gain big (no.....HUGE!!) on this change to one targeted section of our contract. That's not how collective bargaining is supposed to work. Those gains for the company are supposed to be evaluated and the benefits the company stands to receive should be offset in our favor across the contract in areas that benefit the majority of us. I guarantee that whatever retirement gains we might make from changes made outside section 6 negotiations are going to be PENNIES ON THE DOLLAR when compared to what the company saves. But we'll never have the opportunity to use the leverage represented by the balance of those benefits to the company if this is done outside of normal negotiations.
What's going to result is a significant immediate benefit to a minority of our pilots while the majority of us are left to assume the risk. That's not moral and it's not the right thing to do either. The next chance to improve this situation is in 2021. If CD and anyone else doesn't like that timeline then he and the MEC shouldn't have sent this contract out for a vote and he sure as hell shouldn't have voted "yes".
11-11-2017, 08:21 AM
#567
Gets Weekends Off
Joined APC: Mar 2012
Position: Two Wheeler FrontSeat
Posts: 1,162
Originally Posted by pinseeker
51% of the actual crew force, not trolls who pretend to be FedEx pilots.
11-11-2017, 08:22 AM
#568
Gets Weekends Off
Joined APC: Jan 2016
Position: B767 FO
Posts: 195
Originally Posted by Adlerdriver
I don't think that was his point, but it's certainly your prerogative to interpret it that way. I think he's simply voicing concerns many of us share about this process and what's being said by our leadership about it.
When the MEC chairman starts declaring "moral obligations" or what is "the right thing to do" ( a blast from the past), my BS meter pegs. If this process being considered fails and retirees leave between now and 2021 with our current retirement plan, I'm not going to feel ANY failure of morality - individually or collectively. How many of those 780 (MEC chair included) voted yes on this contract, supposedly agreeing to what now has suddenly become a morality check? YGBSM!!
Retirement in this industry is hardly a surprise. Hopefully all the folks approaching that milestone have done their due diligence and are ready. Thankfully, at our company, the losses in retirement experienced by many pax pilot late in their careers didn't happen. What the soon to be retired have planned on for their career will be there. Hell, thanks to the last MEC pang of morality, many got an extra five years they weren't expecting. Most, after decades on WB captain pay, a $130K A-plan and most likely millions in their B-plan will be juuuuuust fine. Characterizing junior pilot's reluctance to embrace this effort as "screwing those mean old pilots for the rest of their lives" is a bit of a stretch. Yeah, we keep bringing up the diminishing value of the A-plan over time. However, right now in 2017, $130K per year is still a worthy amount. It's also what the "yes" voters two years ago who will soon retire agreed to. CD will have to excuse me if I'm not feeling his "moral obligation" quite as strongly as he is.
The company stands to gain big (no.....HUGE!!) on this change to one targeted section of our contract. That's not how collective bargaining is supposed to work. Those gains for the company are supposed to be evaluated and the benefits the company stands to receive should be offset in our favor across the contract in areas that benefit the majority of us. I guarantee that whatever retirement gains we might make from changes made outside section 6 negotiations are going to be PENNIES ON THE DOLLAR when compared to what the company saves. But we'll never have the opportunity to use the leverage represented by the balance of those benefits to the company if this is done outside of normal negotiations.
What's going to result is a significant immediate benefit to a minority of our pilots while the majority of us are left to assume the risk. That's not moral and it's not the right thing to do either. The next chance to improve this situation is in 2021. If CD and anyone else doesn't like that timeline then he and the MEC shouldn't have sent this contract out for a vote and he sure as hell shouldn't have voted "yes".
When the MEC chairman starts declaring "moral obligations" or what is "the right thing to do" (
a blast from the past), my BS meter pegs. If this process being considered fails and retirees leave between now and 2021 with our current retirement plan, I'm not going to feel ANY failure of morality - individually or collectively. How many of those 780 (MEC chair included) voted yes on this contract, supposedly agreeing to what now has suddenly become a morality check? YGBSM!! Retirement in this industry is hardly a surprise. Hopefully all the folks approaching that milestone have done their due diligence and are ready. Thankfully, at our company, the losses in retirement experienced by many pax pilot late in their careers didn't happen. What the soon to be retired have planned on for their career will be there. Hell, thanks to the last MEC pang of morality, many got an extra five years they weren't expecting. Most, after decades on WB captain pay, a $130K A-plan and most likely millions in their B-plan will be juuuuuust fine. Characterizing junior pilot's reluctance to embrace this effort as "screwing those mean old pilots for the rest of their lives" is a bit of a stretch.
Yeah, we keep bringing up the diminishing value of the A-plan over time. However, right now in 2017, $130K per year is still a worthy amount. It's also what the "yes" voters two years ago who will soon retire agreed to. CD will have to excuse me if I'm not feeling his "moral obligation" quite as strongly as he is.The company stands to gain big (no.....HUGE!!) on this change to one targeted section of our contract. That's not how collective bargaining is supposed to work. Those gains for the company are supposed to be evaluated and the benefits the company stands to receive should be offset in our favor across the contract in areas that benefit the majority of us. I guarantee that whatever retirement gains we might make from changes made outside section 6 negotiations are going to be PENNIES ON THE DOLLAR when compared to what the company saves. But we'll never have the opportunity to use the leverage represented by the balance of those benefits to the company if this is done outside of normal negotiations.
What's going to result is a significant immediate benefit to a minority of our pilots while the majority of us are left to assume the risk. That's not moral and it's not the right thing to do either. The next chance to improve this situation is in 2021. If CD and anyone else doesn't like that timeline then he and the MEC shouldn't have sent this contract out for a vote and he sure as hell shouldn't have voted "yes".
Well stated!
Sent from my iPhone using Tapatalk
11-11-2017, 10:12 AM
#569
Gets Weekends Off
Joined APC: Nov 2016
Posts: 936
Originally Posted by mcdbirdman
Keep it coming guys. Let’s show those rich 35 year WB captains who’s the boss. Don’t listen to any argument or discussion about a dying A fund. Just get those guys. Our 130K will be just fine 20 years from now.
11-11-2017, 10:46 AM
#570
Line Holder
Joined APC: Jul 2007
Position: B767/CPT
Posts: 56
Negotiating Committee Message
October 1, 2015
It was great seeing many of you during the recently completed roadshows at all six of our bases around the system. Participation was high and the majority of each stop revolved around answering your questions. It’s important that you took the time to attend and participate. There is a final roadshow scheduled for Tuesday, October 6th at the Germantown Center. We look forward to seeing you there.
We have received some questions surrounding the costing of this tentative agreement. Like all ALPA carriers (and several non-ALPA carriers, too), we used the Economic and Financial Analysis Department of ALPA National (“E&FA”). E&FA used standard costing methodology with models specifically built for FedEx Express pilot demographics, operations and CBA provisions. The models generated the estimated costs of various table positions and eventually, the tentative agreement. We also used analyses provided by other national carriers during their negotiating process. The costing methods used by E&FA are the same ones we used in past negotiations and are accepted as ALPA standard. E&FA's work is widely respected by other industry participants and the National Mediation Board. We are firmly confident that these methods produce reliable and accurate information.
Every agreement has areas that simply cannot be costed beyond an educated guess. This TA is no different in that respect. However, ALPA E&FA was able to cost many areas of the TA. Below are some of the costing estimates that were provided to the MEC during negotiations1.
• Estimated Average Annual Amount Per Pilot2 (excluding Signing Bonus, International Upgrades, Flight Pay Loss, and Known Crewmember):
◦ American Airlines $25,000
◦ Delta Airlines (failed TA) $30,000
◦ FedEx Express TA $60,000
• FedEx Express TA:
◦ Total Amount to Pilot Group in Year 1 $150.2M
◦ Total Amount to Pilot Group per Month in Year 1 $12.5M
◦ Total Amount per Pilot per Month in Year 1 $2,988
Total increased cost of this TA to the Company is over $1.67 billion dollars over the 6-year duration.
Section 3 ($1.42B)
• Compensation ($1.24B)
◦ 10%, 3%, 3%, 3%, 4%, 3%
• Retro Signing Bonus ($145.2M)
◦ $134M to pilots pursuant to ALPA Lump Sum distribution policy and methodology developed by MEC Bonus Advisory Group. The difference between $145.2M and $134M is attributable to DC/DB contributions (the retro signing bonus is fully pensionable) and & employer-paid taxes (FICA and Medicare).
• International Override Increases ($6.1M)
◦ $10 per hour TAFB for Captains
◦ $8 per hour TAFB for First Officers
• Ultra-Long Range Premium ($0.00)3
◦ $24 per CH for Captains
◦ $17 per CH for First Officers
◦ Pays for entire trip guarantee if at least one flight sequence is scheduled for over 16 block hours (currently no flight sequences are scheduled in excess of 16 block hours)
• New Hire Increases ($24.5M)
◦ Training pay increase to $4000 per month
◦ FDA 1st year pay increased to $100 CH
Section 5 ($7.6M)
• Per Diem Increases
◦ Domestic
▪ .10 at DOS
▪ .05 at DOS +2 years
◦ International
▪ .10 at DOS
▪ .10 at DOS +2 years
▪ .10 at DOS +4 years
Section 8 ($29.4M)
• Higher class of service required for all flights 2+30 block or more internationally
Section 11 ($14.8M)
• Instructor Pilot and Check Airman Override increases
• Standards Check Airman Premium increases
Section 12 ($25.5M)
• Change of 36-in-168 to 32-in-120 rest provision
Section 18 ($1.4M)
• Increases in Flight Pay Loss Bank for safety programs
Section 25 ($2.9M)
• Reserve Period change penalty extended to all RP changes
◦ 1+30 CH per block change
• Soft R-Day moves
◦ 3+00 CH per move
Section 26 ($2.0M)
• Uniform allowance increases
• Known Crewmember
Section 27 (-$23.1M)
• Savings to the Company (compared against current plans) based on ALPA's assumed trend rate of 8% medical inflation for all plans (over 5 years) beginning in 2017
Section 28 ($212.5M)
• DC improvements ($91.1M)
◦ +1% at DOS
◦ +1% at DOS +4 years
• Sick Leave Buy-back ($68.4M)
• Advance Notice to Retire ($53M)
◦ Based on chart found on page 534 of the TA
FDA LOA ($2.2M)
• Increased Tuition Assistance
As you can see, these numbers represent a substantial increase in value to our pilots. The numbers were derived through a standard costing process designed to provide a clear and reliable analysis of the value contained within a TA. We encourage you to consider them as you make your decision. Thanks again for your active participation in the ratification process.
See you on Tuesday!
Scott, Bill, Tom, & Andrew
◦
1 These numbers are based on 4,190 pilots on the Master Seniority List and final TA language as of August 19, 2015.
2 Stated value of new money in the contract divided by the number of years of the contract divided by the number of pilots at DOS.
3 FedEx currently has no FAA authority for ULR flying.
The numbers above were sent to us by the Union. Let’s take a look at where the money goes. Values in decreasing order.
Total Value 1.67 Billion
-1.2400B for compensation
-0.1452B retro signing bonus
-0.1214B Combined Sick Buyback and Advance Notice to Retire
-0.0911B Defined Contribution Upgrades
-0.0294B International Higher Class of Service
-0.0255B Cost for Rest Provision Inefficiency
-0.0245B Newhire Compensation
-0.0148B Instructor And Check Airmen Upgrades
-0.0076B Per Diem
-0.0061B International Override
-0.0029B Scheduling Penalties
Who got what?
Compensation everyone got the same raises. By virtue of seat position Captains made more. Industry standard.
Retro Signing Bonus everyone received relative percentages based on seat position.
By Virtue of seat position Captains made more. Standard
Improvements to DC plan. Captains due to pay rates received more, limited by IRS cap limits.
With those 3 high cost items out of the picture, with the Captain seat receiving significantly more total dollars, what remained?
Remaining funds totaled 194 million dollars.
Funds dedicated solely for retirement incentives, sick buyback and advance notice of retirement. 121.4 million dollars. That’s 63% of all remaining dollars.
Quality of life issues, a cornerstone issue. Not addressed. Who is most affected?
Scope, No changes.
Healthcare, another cornerstone issue. $23.1 million dollar GIVEBACK. That’s not a misprint.
Retirement, most members heavily in favor of maintaining the Defined Benefit Pension. No mention during negotiations about changing retirement plans.
121.4 Million dollars specifically designated for members due to retire within the formal duration of this contract. And yet, only 4 months after the the contract was implemented, the Union, at the direction of whom, decides to invest tremendous time and considerable money into changing our current retirement plan.
Moral Obligation?
Simple question. Would the contract have passed if it had a provision creating a new retirement system?
It was great seeing many of you during the recently completed roadshows at all six of our bases around the system. Participation was high and the majority of each stop revolved around answering your questions. It’s important that you took the time to attend and participate. There is a final roadshow scheduled for Tuesday, October 6th at the Germantown Center. We look forward to seeing you there.
We have received some questions surrounding the costing of this tentative agreement. Like all ALPA carriers (and several non-ALPA carriers, too), we used the Economic and Financial Analysis Department of ALPA National (“E&FA”). E&FA used standard costing methodology with models specifically built for FedEx Express pilot demographics, operations and CBA provisions. The models generated the estimated costs of various table positions and eventually, the tentative agreement. We also used analyses provided by other national carriers during their negotiating process. The costing methods used by E&FA are the same ones we used in past negotiations and are accepted as ALPA standard. E&FA's work is widely respected by other industry participants and the National Mediation Board. We are firmly confident that these methods produce reliable and accurate information.
Every agreement has areas that simply cannot be costed beyond an educated guess. This TA is no different in that respect. However, ALPA E&FA was able to cost many areas of the TA. Below are some of the costing estimates that were provided to the MEC during negotiations1.
• Estimated Average Annual Amount Per Pilot2 (excluding Signing Bonus, International Upgrades, Flight Pay Loss, and Known Crewmember):
◦ American Airlines $25,000
◦ Delta Airlines (failed TA) $30,000
◦ FedEx Express TA $60,000
• FedEx Express TA:
◦ Total Amount to Pilot Group in Year 1 $150.2M
◦ Total Amount to Pilot Group per Month in Year 1 $12.5M
◦ Total Amount per Pilot per Month in Year 1 $2,988
Total increased cost of this TA to the Company is over $1.67 billion dollars over the 6-year duration.
Section 3 ($1.42B)
• Compensation ($1.24B)
◦ 10%, 3%, 3%, 3%, 4%, 3%
• Retro Signing Bonus ($145.2M)
◦ $134M to pilots pursuant to ALPA Lump Sum distribution policy and methodology developed by MEC Bonus Advisory Group. The difference between $145.2M and $134M is attributable to DC/DB contributions (the retro signing bonus is fully pensionable) and & employer-paid taxes (FICA and Medicare).
• International Override Increases ($6.1M)
◦ $10 per hour TAFB for Captains
◦ $8 per hour TAFB for First Officers
• Ultra-Long Range Premium ($0.00)3
◦ $24 per CH for Captains
◦ $17 per CH for First Officers
◦ Pays for entire trip guarantee if at least one flight sequence is scheduled for over 16 block hours (currently no flight sequences are scheduled in excess of 16 block hours)
• New Hire Increases ($24.5M)
◦ Training pay increase to $4000 per month
◦ FDA 1st year pay increased to $100 CH
Section 5 ($7.6M)
• Per Diem Increases
◦ Domestic
▪ .10 at DOS
▪ .05 at DOS +2 years
◦ International
▪ .10 at DOS
▪ .10 at DOS +2 years
▪ .10 at DOS +4 years
Section 8 ($29.4M)
• Higher class of service required for all flights 2+30 block or more internationally
Section 11 ($14.8M)
• Instructor Pilot and Check Airman Override increases
• Standards Check Airman Premium increases
Section 12 ($25.5M)
• Change of 36-in-168 to 32-in-120 rest provision
Section 18 ($1.4M)
• Increases in Flight Pay Loss Bank for safety programs
Section 25 ($2.9M)
• Reserve Period change penalty extended to all RP changes
◦ 1+30 CH per block change
• Soft R-Day moves
◦ 3+00 CH per move
Section 26 ($2.0M)
• Uniform allowance increases
• Known Crewmember
Section 27 (-$23.1M)
• Savings to the Company (compared against current plans) based on ALPA's assumed trend rate of 8% medical inflation for all plans (over 5 years) beginning in 2017
Section 28 ($212.5M)
• DC improvements ($91.1M)
◦ +1% at DOS
◦ +1% at DOS +4 years
• Sick Leave Buy-back ($68.4M)
• Advance Notice to Retire ($53M)
◦ Based on chart found on page 534 of the TA
FDA LOA ($2.2M)
• Increased Tuition Assistance
As you can see, these numbers represent a substantial increase in value to our pilots. The numbers were derived through a standard costing process designed to provide a clear and reliable analysis of the value contained within a TA. We encourage you to consider them as you make your decision. Thanks again for your active participation in the ratification process.
See you on Tuesday!
Scott, Bill, Tom, & Andrew
◦
1 These numbers are based on 4,190 pilots on the Master Seniority List and final TA language as of August 19, 2015.
2 Stated value of new money in the contract divided by the number of years of the contract divided by the number of pilots at DOS.
3 FedEx currently has no FAA authority for ULR flying.
The numbers above were sent to us by the Union. Let’s take a look at where the money goes. Values in decreasing order.
Total Value 1.67 Billion
-1.2400B for compensation
-0.1452B retro signing bonus
-0.1214B Combined Sick Buyback and Advance Notice to Retire
-0.0911B Defined Contribution Upgrades
-0.0294B International Higher Class of Service
-0.0255B Cost for Rest Provision Inefficiency
-0.0245B Newhire Compensation
-0.0148B Instructor And Check Airmen Upgrades
-0.0076B Per Diem
-0.0061B International Override
-0.0029B Scheduling Penalties
Who got what?
Compensation everyone got the same raises. By virtue of seat position Captains made more. Industry standard.
Retro Signing Bonus everyone received relative percentages based on seat position.
By Virtue of seat position Captains made more. Standard
Improvements to DC plan. Captains due to pay rates received more, limited by IRS cap limits.
With those 3 high cost items out of the picture, with the Captain seat receiving significantly more total dollars, what remained?
Remaining funds totaled 194 million dollars.
Funds dedicated solely for retirement incentives, sick buyback and advance notice of retirement. 121.4 million dollars. That’s 63% of all remaining dollars.
Quality of life issues, a cornerstone issue. Not addressed. Who is most affected?
Scope, No changes.
Healthcare, another cornerstone issue. $23.1 million dollar GIVEBACK. That’s not a misprint.
Retirement, most members heavily in favor of maintaining the Defined Benefit Pension. No mention during negotiations about changing retirement plans.
121.4 Million dollars specifically designated for members due to retire within the formal duration of this contract. And yet, only 4 months after the the contract was implemented, the Union, at the direction of whom, decides to invest tremendous time and considerable money into changing our current retirement plan.
Moral Obligation?
Simple question. Would the contract have passed if it had a provision creating a new retirement system?
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