DLax85

We shouldn't be doing nothing, and no one here is advocating that position.

Many believe we should be doing something else, then looking at just the VB plan.

Why do you assume the company will do nothing else?

Why does the company ever increase our pay or other benefits at all?

Yes - keep reading. Lets keep discussing and debating.

I believe we are collectively smarter, and ultimately more powerful, as a unified group, who's open and transparent about what the proposed changes mean to everyone.

There are other options on this board that are realistic and attainable...

...indexing the current $260K earnings cap to the IRS limits under the CURRENT A fund structure

...increase in YOS past 25; perhaps, 1% more for 5 more years to 30 YOS max

...increases in the B fund up to 12-13%, hopefully with cash-over-cap

...profit sharing, though I think that's a precarious path due to how the company accounts can manipulate "profit".

Specifically, why are these not attainable?

Let's not sit idle and do nothing.

But let's not take a defeatist approach and think the only way to increase our TOTAL retirement, is to make some major changes to our A plan, without admitting the proposed changes are a very big change and come with significant downsides and risks.

I think both the A plan and the B plan can be improved, well within their current structure.

Yes - it will take negotiation. Maybe even more unity. But isn't that what all contracts which truly improve our pay and benefits take to succeed?

BLOB

I will say that I am still very interested in improving retirement and not at all opposed to exploring options. The one thing that concerns me more than investment risk with the VB plan is how it will change our whole upgrade timeline at this company.

The current high 5 model allows you to upgrade later in your career yet not have it adversely affect your pension. Many delay upgrading for QOL or other reasons. This in turn allows others who are ready to upgrade sooner and accept being junior in return for a bigger check now. Both groups benefit.

With the VB plan where every year and every dollar count towards increasing or decreasing your pension there is a huge disincentive to delay upgrading since it will cost you money now AND in your retirement. The modeler video discusses an option that would predict pay increases/upgrade based on historical numbers. Those would likely change. How much money will it cost you NOW if your upgrade gets delayed 2, 3, 5 years? How much bigger will your pension need to be and how long do you have to live to make that up? A 3 year delay in going WB FO to WB captain can cost you ~$250-300k in lost income now. What is the value of that money if you invest it for retirement?

What happens if the VB goes through and guys demand a realignment bid...age 65 sound familiar. What will that do for unity? Where will the union stand? If you’re a 100% upgrade type or a QOL delay upgrade type the rules of the game will change. No longer will the incentive to live in Memphis and upgrade at 100% be as lucrative. Commuters may be compelled to upgrade at 100% and sit the reserve they have wanted to avoid.

This VB plan can be better for some folks. It might not be as good for others. Consider how your upgrade/seniority progression might be affected when you punch your numbers in the modeler and it spits out what you MIGHT make if the model’s assumptions are correct and the stock market timing works for you.

StarClipper

These guys need to stop pushing this VB Plan like it’s the only option left. The goal is to improve retirement not change or destroy it.

PicklePausePull

Another aspect to this change of behavior involves monthly bidding. If a pilot's upgrade is delayed due to more senior pilots upgrading as soon as possible to maximize pay for retirement computations, then pilots are incentivized to also fly more, sell back vacation, and pick up every available open time trip. That translates into fewer pilots needed by the company to man reserves, with means hiring slows to a trickle.

The consequences of this move to a VB fund make one wonder if our NC and the MEC are working for the company instead of us!! It means delayed upgrades, flying one's butt off to maximize retirement, and fewer pilots required. Work more and get paid the same. Just whose side are these guys on, anyway?

pinseeker

Agreed. I know I would demand a realignment bid if this thing would pass. If the union and the crew force decide to change the rules midstream for retirement and freeze the A plan, as one of the guys who would lose out on the freeze, I should be allowed to bid and be paid for any seat I can hold. The union changes the rules, I get to change my seat position.

What the union fails to advertise in their models is that all of the returns are based on assumptions that have to be negotiated. If the hurdle rate is higher, less returns and less money into the plan.

The percent of payroll to be contributed by the company has to be negotiated. The company also has to agree to increase this contribution yearly as the payroll and 401(a)(17) earnings limits increase. What happens if we don't get that?

The investment ratio of securities to equities are controlled by the company. If the company wants to minimize their longevity risk, they reduce the investment risk thereby reducing returns. If they aren't on the hook for as much of a payout, then they reduce the longevity risk.

The floor benefit. The funding for that still isn't included in the models. If the floor benefit is equal to or great than the current $130K, then what benefit is it to the company to agree to pay for the floor benefit. So what happens if the line in the sand is that we have to pay for the floor benefit or stabilization fund? How does that effect the VB plan?

By the way, this plan is no safer from being taken from us in bankruptcy than the current A plan. As a matter of fact, I would argue that in a bankruptcy court, the company would argue that giving up the now separated pilot VB plan would affect much fewer people than giving up the company DB plan. There was already an article printed about the company purchasing an annuity for 41,000 employees covered under the DB plan that our plan is currently tied to. Now the company argues to the court that it would be unfair to touch the plan of 41,000+ low wage employees when it could just end the plan of 6K-7K highly payed pilots. Robinhood to the rescue.

I am all for exploring other options to improve the A plan or increase our retirement value, but it seems that the union is stuck on only exploring one plan, and that plan has way to many variables that need to be negotiated with rock solid language in order to be successful. How are we at negotiating rock solid language? How are we at out negotiating the company? Tell your reps that we want more options.

It's been six months since the negotiating committee presented this plan to the company. When is the company going to open up negotiations? How much more money are we going to spend riding this train? When is the negotiating chairman going to stop his sales job and tell the crew force that the numbers these models come up with are based solely on assumptions and could change significantly to the lower side if these assumptions are wrong or can't be negotiated in our favor?

RMFedex

Awesome. You chose to delay upgrading. Now if you get your way you would demand to bump somebody out of the seat you passed on. If we use your “logic” shouldn’t there be a realignment bid with every contract since the rules change with each contract. Did you complain when the over 60 crowd caused the excesses when the age 65 rule changed everything?

pinseeker

Darn right. I upgraded based on my retirement being calculated by high five earnings. If the rules change to make retirement based on total earnings then yes, there should be a realignment bid and I’ll stay until age 65. President Bush and Congress changed age 60. We are doing this to ourselves.

RMFedex

Let’s hope ALPA and the company don’t agree with you then. Sorry you didn’t upgrade when you could. Our system doesn’t let you bump somebody because you chose poorly...unless there’s an excess.

pinseeker

Are you sure about that. All that has to happen is that the company posts a bid with manning 1 greater than max manning in each seat. Excess bids don’t exist in the new contract. We’ll see in six years when all of this finally gets settled. Maybe longer if the guys who feel they got hosed decide to take it to court. Maybe this time the union will withhold 40% of the back pay signing bonus because of possible legal challenges.

msduckslyr

Oh, but it is. A lot of us got "bumped" down to help our over 60 crowd sitting in the backseats get back to the front. This was done because the rules changed. This is no different, except we are doing this to ourselves. People making QOL choices didn't choose poorly. They made a decision based on the rules that exist. If the rules are changed, absolutely there should be a bid.

Nonetheless, I hope the negotiating team gets their butts out of their heads, and stops pushing a change to retirement that hurts people. There is a minority group in the middle that really loses by freezing the A Fund to accommodate a new DB plan. This should be a "no pilot left behind" decision or better yet... "an every pilot benefits" decision.