StarClipper

You're not being a prick to me at all. Yours words mean nothing to me. You're a selfish prick who made a selfish decision to support and vote for a contract which you are clearly not satisfied with. If you were happy with what you voted you wouldn't be supporting your Union try to modify your retirement less than 2yrs after your signed a contract

max8222

So yes I am looking out for ME but there are a lot of pilots in the same position as me. I want to know if they freeze our A plan and but us on some hybrid B Fund how they are going to make me whole. I am at 20 yrs of service and have my high five. Plan on retiring in 7 years at 63. So at current numbers 5 yrsX 2%=10% less the $130K max or $13K less.

So my A Plan is now worth $117K a year. To get back that $13k a year assuming 7 years to make it up with a larger B Fund would take $13k/.05%=$260K or $37k a year. No way they are going to put that away for me. Really should have it at 5 more years!

So they might have stress tested the crap out of so random number so my $117 K will grow, Did they figure how they are going to get the company to pay us to at least get us at parity?

Fdxlag2

Actually I think the contract was very satisfactory. Still the best in the industry.

StarClipper

What did you really get out of that contract? Most of the people who vote for it did so because they were either tired of waiting, or accepted the "that the best we will get" coolaid. They didn't vote for it because it was a good contract, so keep fooling yourself. A good contract don't get voted in by such a small margin.

Fdxlag2

Give us a lesson on how much better your contract.

dckozak

Didn't think it was necessary to say so

No problem in the future. Retiring NB FO's working min BLG will make the cap in the future. When.. I don't know, depends on our negoiating ability and inflation.


I don't complain, I just explain. At least that's what I tell my wife.
I agree, our retirement plan is unfair to long termers. That said, we individually give away our time when working past 60 with 25 YOS. Someone pointed out in an earlier post that if you retire at 60 and defer your payouts you will earn higher monthly payments than when you start to take your money from the start. Work past 60, which means less $$$ out of the company A fund kitty. Do you get a reward for collecting later?

I'm wary of change for the same reason others are, I'm just of the mind that no change is as bad and puts us at a disadvantage. Had we gotten cash over cap, meaningful B fund improvements in a timely manner, more credit for YOS, some kind of profit sharing that could boost B fund, this would not be a discussion. Doing nothing increases our risk. The A plan is going to fade way, that is guaranteed without a some change. If I was junior, I'd be very alarmed. For us oldies, very little is going to help my generation of near departures other than some improvement in cap. Without some major change of course, junior guys are going to pay a severe price if they mismanage their B fund or are unlucky enough to retire during a major downturn.

kwri10s

Not to interrupt the love fest you two are having, we should not use "sound bite" numbers that the union threw out with the last contract. That 4-1 is just stupid for the union to say. When they open their mouths and spout that drivel it just shows they don't know what they are talking about. Yes, it might cost the company some multiple of what they are paying out IF they wait to fund each members retirement fund until the member is closer to retirement.

Funding an A fund is all about when the company designates monies into the fund and also how much they designate. The company can wait until a pilot reaches his 10th year and begin to fund against the pilot's retirement if they want. I have no idea of what the funding requirements would be if they started at the 10 year point, but the company will be required to fund more than if they started funding when the pilot was hired. Conversely if they wait to fund until the pilot reaches the 15 year point it will take more capital than if they started at 10 years of service.

For just fun and your own enjoyment (not you specifically, the collect you of those reading), take a simple spreadsheet and put in 1 Million dollars then do a simple rate of return of 4.5% (the rate FDX is paying on the last 4 Billion dollar bond they issued in order to fund the latest stock buyback). After 25 years the interest will easily fund your annual retirement without touching the capital. When you die, the company can then roll the remainder into the fund for the next new hire. Increase the rate of return and you need less at the initial funding to cover the retirement.

Now that's simple math. There are companies that manage risk and invest accordingly. A pretty simple process of early risk when the pilot is young in the career and less risk as he nears retirement would result in substantially higher rates of returns even if they never got near equities. A 6% rate of return earns you might have $180k in interest returns for your retirement, and 8% earns you $240k. 8% is probably out of the reasonable projections, but just FYI.

I'm not saying this is the solution, but it's a basic simple example of how to fund for future projected expenses that I can easily see. I'm sure the real solutions are much more complex and reasonable, but to keep telling us they can't afford to fund it, and us believing them, is dumb. The company just has to decide when they want to fund the A plan. They just don't want to have money sitting in our retirement fund when they could use that money to buy back stock or pay bonuses. Retirement funds are not sexy for investors so since the corporate mantra is all about the investors and screw you to the employees, that means they want to do away with having to set aside money for our retirement.

I know my marching orders to the MEC are: improve the A plan and increase the B fund (or increase the 401k match). Don't have two scales of pilot retirements. At some point in the future IF the company is less solvent and people no longer ship things and we are looking at ways to help the company (like UAL and AA), then maybe we could look at alternatives. But until that point, stop screwing with the A plan unless it is an improvement.

Fdxlag2

What is the rate of return they have to get to nuetralize the 6% they have to pay the PGBC? How about if they have been funding the plan for the last 18 years with a projected liability of 130k per year per pilot and now the liability is increased to 150k? Does the plan go from overfunded to underfunded with PGBC penalty implications? You don't think the number is 4$ you tell me what it is. Why do you think the UPS pension that nearly catches ours has an expiration date? I am not re arguing that we could have gotten more, we probably could have, but it would have taken at least the 18 months that it took Delta. I am just as happy with my yes vote on this contract as you probably are for your yes vote in 2011 when we had some real leverage and I voted no.

The non FDX pilot said one reason to vote yes is you are tired. God darn right I was tired of watching others fly Draft trips and selling back vacation that could have been mine. But that doesn't change the fact that the contract we voted yes on was the best in the industry.

I am already on record as saying don't screw up our A Plan, leave it alone.

FXDX

Caution: Public Math

Actually, if I read your info correctly, your A plan benefit "right now" is 20 years times 2% times 260. That equals $104,000, but that assumes you don't retire early, so you would have to defer payments until age 60. (20/25 years is 80%, not 90%)

If you retired "right now" you would take a penalty of 3% of the benefit for each year prior to age 60, and thus your pension "right now" is actually .88 X 104,000 or $91,520. If you defer to age 60, as noted above, it would be $104,000.

If you work to age 60, it would be .48 X 260 or $124,800. And if you work to 63 as you are planning you will get the full monte: .5 X 260 equals $130K.

All of these amounts are before any survivor benefit reductions.

The rest of your points remain valid of course, even more so as the numbers required in the B fund improvements would have to be even greater to make up the difference in your scenario.

FXDX

The guys who have 25 years of service and their high five have absolutely nothing to lose in their scenario of freezing the current A plan. They can only go up with adding another defined benefit plan to the current A plan. Guys who stand a lot to lose are those who were hired at a later stage in life and will never get 25 years of service or perhaps even a high five of $260. Pilots who are out on LTD could also be adversely affected in a similar fashion.

This effort is being led by pilots with nothing to lose and desperately trying to get some kind of bump in their retirement benefits before they hit 65. That would be ok if they also get real improvements for everybody else, but I'm not convinced that will happen.

Even if the company were shown these plans and they were able to save money and increase our benefits I'm not convinced they would do it. Either out of spite or for company morale. How could they justify increasing our defined benefit plans after freezing everybody else's just a few years ago? I think the fallout from such a maneuver is why the company refused to consider it in the last contract negotiation.

I'm also not sure this pilot group (57% of whom voted for the current contract) will have the fortitude to vote something new down that really doesn't increase every pilot's benefits. A lot of pilots are prejudiced against A plans because they or somebody they know lost theirs due to bankruptcy and that is a valid concern. They hear A plan and instinctively think it will never be there for them and will take any B plan bump to cast away the A plan.

We all know that its not possible to replace that $130K per year with B fund bumps under current IRS limits. I'll take the small risk of FedEx going bankrupt in the next 20-30 years over taking on all of the investment risk myself over that same time frame. I've got the B plan and my personal savings to put in the market to augment the A plan and that is enough personal risk for me.