How's our A Fund Doing? 10 year History
05-10-2018, 01:26 PM
#51
Gets Weekends Off
Joined APC: Sep 2006
Position: MD11 FO
Posts: 1,109
Originally Posted by pinseeker
Tuck,
To reply to your first response, what do you mean when you say that the VB contribution is capped at $260k? In the model presentation the union stated that the 401(a)(17) limit was increase annually based on their historic prediction. Also, if your retirement benefit is based on lifetime earnings, don't you think that guys will try to upgrade quicker to increase those earnings. We only have a little over 1500 WB captains and the top 1500 on the seniority list were all hired prior to 2000.
To answer your last question, the NC and several reps have told me that the VB plan with a floor benefit and insuring that no pilot is disadvantaged by freezing the A plan will cost more than the current A plan. I have no idea what you mean by PBO, but the company will still have to pay the same PBGC premiums that they currently pay. The benefit to the company is if the market goes down, they don't have to make a large contribution to the plan to make up the underfunded amount. The PBGC funding requirements are there to help insure that our A plan stays funded. That is a good thing.
To reply to your first response, what do you mean when you say that the VB contribution is capped at $260k? In the model presentation the union stated that the 401(a)(17) limit was increase annually based on their historic prediction. Also, if your retirement benefit is based on lifetime earnings, don't you think that guys will try to upgrade quicker to increase those earnings. We only have a little over 1500 WB captains and the top 1500 on the seniority list were all hired prior to 2000.
To answer your last question, the NC and several reps have told me that the VB plan with a floor benefit and insuring that no pilot is disadvantaged by freezing the A plan will cost more than the current A plan. I have no idea what you mean by PBO, but the company will still have to pay the same PBGC premiums that they currently pay. The benefit to the company is if the market goes down, they don't have to make a large contribution to the plan to make up the underfunded amount. The PBGC funding requirements are there to help insure that our A plan stays funded. That is a good thing.
I think initially there will be some movement to upgrade but not for long as most WB FOs will be able to make the IRS 401a17 limits - so yes on the NB FOs. But, even if you average in say 5 years at NB FO, 5 years at WB FO with low wages and then another 20 years at a mix of WB FO/NB CA/WB CA with 401a17 wages - it will still easily be better than the current A plan...for most people. There are those in the "heat map" that got hired here late - say a guy hired here at age 45 and can only work a max of 20 years - and maybe he can't make those 401a17 wages until year 12 or something - he may be someone that would lose out under the new VB plan - he has to be fixed and all the briefs and videos I've watched, the NC has always said there will be a fix for those guys.
Yes on PBGC premiums - def a good thing. That wasn't part of any thing I had written though. Look, the Company may not accept what we need - and I do mean NEED. So do you think it's worth negotiating to see if they would or should we just wait until 2021 and re-attack the A plan? Those are the only two viable choices I see and we've wasted a ton of time on improving that A plan. The A plan has not measurably changed since 1999! They were going to do it in 2006 then just couldn't. 2011 I doubt there was even an attempt. Spent a ton of time on 2015 until we finally accepted Company saying "read my lips" - so we can go back to that drawing board or try something new. I'm a fan of something new. If there's a better vehicle than the modeled vb plan, let's hear it.
05-10-2018, 06:45 PM
#52
Proponent of Hysteria
Joined APC: Mar 2005
Position: 3B
Posts: 1,052
NOTHING has been negotiated, there is NO floor. Your benefit could be less if you have the misfortune of retiring after a few down years in the market. We would be releasing the company from their liability, accepting all the market risk ourselves. We can already do that with our B fund, I don't want to do that to my A fund.
So far all we have is promises that the folks on LTD won't be left behind and those who got hired later in life and won't ever maximize their benefit under the current plan won't get left behind. Those promises give me no solace whatsoever. Another thing they don't discuss during the meetings is a few years of 4A2b. Sure, every year counts, even the bad ones, especially the bad ones.
Nobody will be left behind, yeah, never heard that before.
So far all we have is promises that the folks on LTD won't be left behind and those who got hired later in life and won't ever maximize their benefit under the current plan won't get left behind. Those promises give me no solace whatsoever. Another thing they don't discuss during the meetings is a few years of 4A2b. Sure, every year counts, even the bad ones, especially the bad ones.
Nobody will be left behind, yeah, never heard that before.
05-11-2018, 03:18 AM
#53
Gets Weekends Off
Joined APC: Aug 2006
Posts: 1,820
Originally Posted by FXDX
NOTHING has been negotiated, there is NO floor. Your benefit could be less if you have the misfortune of retiring after a few down years in the market. We would be releasing the company from their liability, accepting all the market risk ourselves. We can already do that with our B fund, I don't want to do that to my A fund.
So far all we have is promises that the folks on LTD won't be left behind and those who got hired later in life and won't ever maximize their benefit under the current plan won't get left behind. Those promises give me no solace whatsoever. Another thing they don't discuss during the meetings is a few years of 4A2b. Sure, every year counts, even the bad ones, especially the bad ones.
Nobody will be left behind, yeah, never heard that before.
So far all we have is promises that the folks on LTD won't be left behind and those who got hired later in life and won't ever maximize their benefit under the current plan won't get left behind. Those promises give me no solace whatsoever. Another thing they don't discuss during the meetings is a few years of 4A2b. Sure, every year counts, even the bad ones, especially the bad ones.
Nobody will be left behind, yeah, never heard that before.
A380 pay rates for 777, lie flat seats, FDA LOA 1 is the best we can get, lots of hidden money in grid penalties, it's a 3% pay raise.... why should I trust that the union won't screw up negotiating the VB plan and then sell it to the crew force as the best we can do? What's their track record? There are way to many variable in the VB plan that need to be negotiated, and the union has already shown their hand stating what they would be happy with. FedEx will only negotiate down from there.
05-11-2018, 04:17 AM
#54
Gets Weekends Off
Thread Starter
Joined APC: Jul 2007
Position: Gear Monkey
Posts: 3,191
Originally Posted by Tuck
.....I'm a fan of something new. If there's a better vehicle than the modeled vb plan, let's hear it.
I think this hybrid approach to improving our Total Retirement will address a number of issues (stagnate $260K, pilots working on average 4-5 years longer, not transferring all investment risk, not redesigning disability benefit, not having to freeze current A plan, not trading High 5 for Career Avg Earnings, not taking away pilot flexibility and QOL,...and many more “unseen” issues/consequences that will certainly arise by changing to a VB plan)
These changes are all simple to understand, implement and transparent:
1. Current A Fund High 5 FAE method, but $260K Cap replaced and indexed to IRS401 limits
(This will be about a 5-6% immediate increase and then rise, as the IRS adjusts based on inflation - approx 2-3% per year)
2. Current 2% multiplier for first 25 YOS x High 5 FAE, then added 1% multiplier for additional 5 YOS. (Combined 30 max)
Thus new max = 55% of IRS401 limits
PLUS
3. Increase B found over time from 9% to 13%
DISCUSS....
05-11-2018, 05:26 AM
#55
Gets Weekends Off
Joined APC: Aug 2006
Posts: 1,820
Originally Posted by DLax85
Here ya go...
I think this hybrid approach to improving our Total Retirement will address a number of issues (stagnate $260K, pilots working on average 4-5 years longer, not transferring all investment risk, not redesigning disability benefit, not having to freeze current A plan, not trading High 5 for Career Avg Earnings, not taking away pilot flexibility and QOL,...and many more “unseen” issues/consequences that will certainly arise by changing to a VB plan)
These changes are all simple to understand, implement and transparent:
1. Current A Fund High 5 FAE method, but $260K Cap replaced and indexed to IRS401 limits
(This will be about a 5-6% immediate increase and then rise, as the IRS adjusts based on inflation - approx 2-3% per year)
2. Current 2% multiplier for first 25 YOS x High 5 FAE, then added 1% multiplier for additional 5 YOS. (Combined 30 max)
Thus new max = 55% of IRS401 limits
PLUS
3. Increase B found over time from 9% to 13%
DISCUSS....
I think this hybrid approach to improving our Total Retirement will address a number of issues (stagnate $260K, pilots working on average 4-5 years longer, not transferring all investment risk, not redesigning disability benefit, not having to freeze current A plan, not trading High 5 for Career Avg Earnings, not taking away pilot flexibility and QOL,...and many more “unseen” issues/consequences that will certainly arise by changing to a VB plan)
These changes are all simple to understand, implement and transparent:
1. Current A Fund High 5 FAE method, but $260K Cap replaced and indexed to IRS401 limits
(This will be about a 5-6% immediate increase and then rise, as the IRS adjusts based on inflation - approx 2-3% per year)
2. Current 2% multiplier for first 25 YOS x High 5 FAE, then added 1% multiplier for additional 5 YOS. (Combined 30 max)
Thus new max = 55% of IRS401 limits
PLUS
3. Increase B found over time from 9% to 13%
DISCUSS....
Winner winner chicken dinner!!!
05-11-2018, 11:51 AM
#57
Line Holder
Joined APC: Dec 2016
Position: FedEx
Posts: 86
Originally Posted by DLax85
Here ya go...
I think this hybrid approach to improving our Total Retirement will address a number of issues (stagnate $260K, pilots working on average 4-5 years longer, not transferring all investment risk, not redesigning disability benefit, not having to freeze current A plan, not trading High 5 for Career Avg Earnings, not taking away pilot flexibility and QOL,...and many more “unseen” issues/consequences that will certainly arise by changing to a VB plan)
These changes are all simple to understand, implement and transparent:
1. Current A Fund High 5 FAE method, but $260K Cap replaced and indexed to IRS401 limits
(This will be about a 5-6% immediate increase and then rise, as the IRS adjusts based on inflation - approx 2-3% per year)
2. Current 2% multiplier for first 25 YOS x High 5 FAE, then added 1% multiplier for additional 5 YOS. (Combined 30 max)
Thus new max = 55% of IRS401 limits
PLUS
3. Increase B found over time from 9% to 13%
DISCUSS....
I think this hybrid approach to improving our Total Retirement will address a number of issues (stagnate $260K, pilots working on average 4-5 years longer, not transferring all investment risk, not redesigning disability benefit, not having to freeze current A plan, not trading High 5 for Career Avg Earnings, not taking away pilot flexibility and QOL,...and many more “unseen” issues/consequences that will certainly arise by changing to a VB plan)
These changes are all simple to understand, implement and transparent:
1. Current A Fund High 5 FAE method, but $260K Cap replaced and indexed to IRS401 limits
(This will be about a 5-6% immediate increase and then rise, as the IRS adjusts based on inflation - approx 2-3% per year)
2. Current 2% multiplier for first 25 YOS x High 5 FAE, then added 1% multiplier for additional 5 YOS. (Combined 30 max)
Thus new max = 55% of IRS401 limits
PLUS
3. Increase B found over time from 9% to 13%
DISCUSS....
Sent from my SAMSUNG-SM-G935A using Tapatalk
05-11-2018, 01:07 PM
#58
Gets Weekends Off
Joined APC: Sep 2006
Position: MD11 FO
Posts: 1,109
Originally Posted by DLax85
Here ya go...
I think this hybrid approach to improving our Total Retirement will address a number of issues (stagnate $260K, pilots working on average 4-5 years longer, not transferring all investment risk, not redesigning disability benefit, not having to freeze current A plan, not trading High 5 for Career Avg Earnings, not taking away pilot flexibility and QOL,...and many more “unseen” issues/consequences that will certainly arise by changing to a VB plan)
These changes are all simple to understand, implement and transparent:
1. Current A Fund High 5 FAE method, but $260K Cap replaced and indexed to IRS401 limits
(This will be about a 5-6% immediate increase and then rise, as the IRS adjusts based on inflation - approx 2-3% per year)
2. Current 2% multiplier for first 25 YOS x High 5 FAE, then added 1% multiplier for additional 5 YOS. (Combined 30 max)
Thus new max = 55% of IRS401 limits
PLUS
3. Increase B found over time from 9% to 13%
DISCUSS....
I think this hybrid approach to improving our Total Retirement will address a number of issues (stagnate $260K, pilots working on average 4-5 years longer, not transferring all investment risk, not redesigning disability benefit, not having to freeze current A plan, not trading High 5 for Career Avg Earnings, not taking away pilot flexibility and QOL,...and many more “unseen” issues/consequences that will certainly arise by changing to a VB plan)
These changes are all simple to understand, implement and transparent:
1. Current A Fund High 5 FAE method, but $260K Cap replaced and indexed to IRS401 limits
(This will be about a 5-6% immediate increase and then rise, as the IRS adjusts based on inflation - approx 2-3% per year)
2. Current 2% multiplier for first 25 YOS x High 5 FAE, then added 1% multiplier for additional 5 YOS. (Combined 30 max)
Thus new max = 55% of IRS401 limits
PLUS
3. Increase B found over time from 9% to 13%
DISCUSS....
05-11-2018, 01:33 PM
#59
Gets Weekends Off
Joined APC: Aug 2006
Posts: 1,820
Originally Posted by Tuck
Sure - this is something that you can do in Section 6 in 2021 - it's just another idea of what has been tried before. Nothing particularly new here - no eureka moment. There is certainly zero interest in the Company to engage on this idea so thus there is zero chance it can even happen until 2021 and then, based on 2006, 2011 and 2015, very little change of it leading to a successful outcome....but hey it will take a lot of our negotiating time and capital.
Why can you negotiate a VB plan outside of Section 6 and not the A plan?
It's been six months since the union proposed this VB plan that solves both of our problems to the company and so far, if the union is being transparent, crickets!! Why?
It seems to me that the company isn't interested in negotiating this outside of Section 6. So how much capital did we waste on this if they aren't interested?
But hey, we'll settle for what we can get after the company draws a new line in the sand.
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