The latest video from the MEC uses historical past performance and future pay increases to show how the new plan is better than the current A plan. However, they never mention that the value from the prospective VB plan is actually only 28%-34% of that future high five in earnings. Even with the A plan having never been increased, we still get about 43% of a high five using todays pay scales and their earnings formula. Why not find a way to get 50% of your high five as was the original intent of the contract. The current IRS limits are higher than 50% of our high five.

 

Also using one of the examples of a new hire at 25. That is so rare. If you get hired that young you should be set no matter what plan you have. I think it was put in to help the numbers look attractive.

Also assuming a 3% raise a year is high. We went some years with 3% every 1.5 Years.

Still waiting for the video on how they are going to make the guys in the middle whole.

 

Like a lot of people, I read what is posted on this site often, yet do not really comment because usually either someone has already said it, or it’s a waste of blood pressure points to get into the fray. But WTH? When is the madness of giving up the A-plan going to stop?? Is our representation too proud to admit the deep dive work they did (which I think was prudent to at least see what could be done with our retirement) produced losing results? It is A-OK that their hard work investigating A-plan alternatives arrived at the conclusion that the current A-plan is the best option going right now... it isn’t wasted work. It is however, false to push upon the huddled masses a variable benefit plan that is worse in all markets except the +7000 points increase in the DOW we are experiencing now. Stop the dang sales job!!
C’mon, put your sense of ownership aside and call this turd like it is. Please.

 

800k yearly earnings - bahaha

Anyone want to bet how long negotiations take and we do not get the 'assumed' 3% yearly raises during that time?

 

The video was presented at yesterday's Joint Council Meeting in Memphis, and I asked a lot of questions about our A-plan. How much would it cost to raise the FAE cap from $260,000 to $280,000? How much would it cost to extend the Years of Service cap from 25 years to 30 years, or remove it altogether. How many people are currently collecting a benefit from the current A Plan? They answered none. (The event, including the Q & A, was video-taped -- I wonder if those will survive the edit.) Instead, they got a little emotional and characterized my questions as political. Funny, I thought this was about business.


They are determined they're NOT going to try to improve our current A Plan by either raising the Final Average Earnings cap or removing or extending the Years of Service cap. They are unwilling to fight for it.


And they're not going to try to sell this Variable Benefit Plan, but they want us to know the MEC unanimously endorses it. Even the guys and gal who voted against the last TA support this plan. I'm sure that will be all many of our number will need to know. Why bother studying the options and getting educated about the issue -- if the MEC voted for it, we ought to be for it, too, right?


The assumptions in the tables are that the A Plan is stuck at the current FAE cap and YOS cap, while the Variable Benefit plan tracks IRS income limits and has no Years of Service Cap. Even so, the big differences in the benefit amounts, even using their generous market assumptions, don't occur until the 25-year limit is reached. Mind you, that amount can hit the floor if the last year before retirement is a down year. You earn "shares" in the plan along the way to retirement, but you won't know the value of those shares until it's time to pull the plug.

Hey, but at least you won't be at risk of The Company going bankrupt. As risks go, and there are several, that's not my biggest fear.






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Any do we know how many of those folks have already attained their high 5?
And how many are already past 25 YOS and have effectively accrued all they can from our existing A plan?

 

This isn't an apples to apples comparison, not even apples to oranges. It's more like apples to banana spiders. The percentages apply to different concepts, so you cannot compare them.


Currently, a pilot can earn an average of $260,000 for any five years, and next to nothing for the other 20, and receive the full $130,000 annual benefit in retirement.


In the proposed plan, the one they kept calling the "New Plan" yesterday as if it were a done deal, the percentage that counts is the market performance number in a particular year multiplied by the pilot's W-2 earnings in that same year. That earns him "shares" in a virtual mutual fund, the value of such shares being determined when that pilot retires. The next year, the process repeats. The more you work, the more shares you get. The worse the market, the more shares you get. Add up all the shares from all the years, and that's what you end up with. When markets are good, the share values go up, and when markets are bad, the share values go down -- even the shares which you "earned" during good years. But the only year that counts to determine your actual retirement benefit is the year the pilot retires. Choose your retirement date wisely. If you retire in a good year, all of your shares are more valuable, but if you retire in a bad year, all of your shares are less valuable.


The scheme will encourage pilots to work harder, and longer, because every dollar earned will increase the number of retirement shares you can earn. (I'm sure the junior guys will love what that will do to seat progression.) There will be no such thing as getting your high five early and then taking it easy in the later years.






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That is exactly what the problem is...PRIDE. We see it at work in our government and we see it at work in our MEC. This is their baby and they sure are not going to throw it out. Of course, if I had my A Plan maxed out, I would be all in favor of it too.

They like to give examples...here is one for you. I was hired in my mid 40s so the "45 year old" example he used fits my situation. If I want to retire at 60, I can expect a 3% improvement over the current A Plan. 3% freaking percent. And, I assume basically all of the risk.

Sure, if you get hired when you are 25, or work until you are 65, the potential for a bigger payout is there. Duh...its called compounding. That's what the B Plan is for.

How about you produce a realistic video about risk. How about you show the "worst case scenario". If this plan is so good, you should have no problem guaranteeing me at least a $130k benefit right? No? You mean I might not get that?

If you want those of use in the middle to rally behind this thing you better start some real education and answering real questions at MEC events. As it is right now, I want nothing to do with it. Just another group of politicians looking out for their own interests and the interests of the elite (those who have their A Plan maxed out already).

 

Exactly! Nothing to lose

 

And, as others how pointed out, what if you go out on disability? We know how that works with the A Plan. How's it going to work with the VB Plan? Not so well is my guess