Arbitration
03-25-2018, 01:22 PM
#41
China Visa Applicant
Joined APC: Oct 2006
Position: Midfield downwind
Posts: 1,919
Don't worry.
Our guys will be able to successfully negotiate the dozen or so factors with the company that would have to be established to make the VB plan an improvement on the A Plan.
I mean, they didn't win about lie-flat seats...but all these big-dollar-sign points will be a snap.
Our guys will be able to successfully negotiate the dozen or so factors with the company that would have to be established to make the VB plan an improvement on the A Plan.
I mean, they didn't win about lie-flat seats...but all these big-dollar-sign points will be a snap.
03-25-2018, 01:55 PM
#42
Gets Weekends Off
Joined APC: Jul 2008
Position: B767
Posts: 795
After 12 years as an ALPA member I have seen defeat after defeat. When will we stop? Language means more than good will. If the company says this is how we plan to apply the language then it should be easy to write it that way. Sick and tired of getting raked over the coals by “sorry this is just how the language applies, it’s out of my hands” from middle management and ALPA who seem to be in lock step together.
-UA
-UA
03-25-2018, 02:24 PM
#43
Gets Weekends Off
Joined APC: Aug 2006
Posts: 1,820
Originally Posted by Flying Boxes
Kronan,
Thanks for explaining all topics. Not sure about what you say, but I clearly need to do more research to fully understand this proposed change in plan. Time to review the VB material/videos again.
Thanks for explaining all topics. Not sure about what you say, but I clearly need to do more research to fully understand this proposed change in plan. Time to review the VB material/videos again.
I highly encourage you to review all of the information put out by the union. I also request that you look at the following areas.
First, there is no guaranteed floor benefit. There is no government regulation that requires it. That needs to be negotiated. In the communications, the union states that in the absence of a floor benefit, a stabilization fund could be established. The company pays for a floor benefit, we pay for a stabilization fund. Which one do you think the company will opt for?
Second, a DB plan has minimum funding requirement per the PBGC. A variable plan has no defined payout, it is strictly stock market dependent. Without a floor benefit, the only risk that the company assumes is the longevity risk. The union even says that a VB plan can not be underfunded because there is no guaranteed payout.
Third, the company still controls the investments. Currently, the company has a vested interest in how the investments perform because if the plan becomes underfunded, they have to make an increased payment or pay PBGC penalties until the plan becomes properly funded. With the VB plan, it can't be underfunded, so there is no vested interest in how the investment perform. Actually, there may be an incentive to place most of the money in very low yielding, safe investments to help mitigate the longevity risk. The union model used a 50/50 securities to income investment portfolio. What if the company decided to use a 20/80 percent security to income investment portfolio? Our potential upside would be greatly reduced as well as the companies longevity risk. That solves the companies problems, but what about ours. Don't think it will happen? Triple 7 pay rates and lie flat seat arbitrations are just two of the many lost arbitrations that were give aways in past contracts. Why wouldn't the company try to find loose language to save money on our backs again?
03-25-2018, 02:32 PM
#44
Gets Weekends Off
Joined APC: Mar 2012
Position: Two Wheeler FrontSeat
Posts: 1,162
Originally Posted by pinseeker
Flying Boxes,
I highly encourage you to review all of the information put out by the union. I also request that you look at the following areas.
First, there is no guaranteed floor benefit. There is no government regulation that requires it. That needs to be negotiated. In the communications, the union states that in the absence of a floor benefit, a stabilization fund could be established. The company pays for a floor benefit, we pay for a stabilization fund. Which one do you think the company will opt for?
Second, a DB plan has minimum funding requirement per the PBGC. A variable plan has no defined payout, it is strictly stock market dependent. Without a floor benefit, the only risk that the company assumes is the longevity risk. The union even says that a VB plan can not be underfunded because there is no guaranteed payout.
Third, the company still controls the investments. Currently, the company has a vested interest in how the investments perform because if the plan becomes underfunded, they have to make an increased payment or pay PBGC penalties until the plan becomes properly funded. With the VB plan, it can't be underfunded, so there is no vested interest in how the investment perform. Actually, there may be an incentive to place most of the money in very low yielding, safe investments to help mitigate the longevity risk. The union model used a 50/50 securities to income investment portfolio. What if the company decided to use a 20/80 percent security to income investment portfolio? Our potential upside would be greatly reduced as well as the companies longevity risk. That solves the companies problems, but what about ours. Don't think it will happen? Triple 7 pay rates and lie flat seat arbitrations are just two of the many lost arbitrations that were give aways in past contracts. Why wouldn't the company try to find loose language to save money on our backs again?
I highly encourage you to review all of the information put out by the union. I also request that you look at the following areas.
First, there is no guaranteed floor benefit. There is no government regulation that requires it. That needs to be negotiated. In the communications, the union states that in the absence of a floor benefit, a stabilization fund could be established. The company pays for a floor benefit, we pay for a stabilization fund. Which one do you think the company will opt for?
Second, a DB plan has minimum funding requirement per the PBGC. A variable plan has no defined payout, it is strictly stock market dependent. Without a floor benefit, the only risk that the company assumes is the longevity risk. The union even says that a VB plan can not be underfunded because there is no guaranteed payout.
Third, the company still controls the investments. Currently, the company has a vested interest in how the investments perform because if the plan becomes underfunded, they have to make an increased payment or pay PBGC penalties until the plan becomes properly funded. With the VB plan, it can't be underfunded, so there is no vested interest in how the investment perform. Actually, there may be an incentive to place most of the money in very low yielding, safe investments to help mitigate the longevity risk. The union model used a 50/50 securities to income investment portfolio. What if the company decided to use a 20/80 percent security to income investment portfolio? Our potential upside would be greatly reduced as well as the companies longevity risk. That solves the companies problems, but what about ours. Don't think it will happen? Triple 7 pay rates and lie flat seat arbitrations are just two of the many lost arbitrations that were give aways in past contracts. Why wouldn't the company try to find loose language to save money on our backs again?
03-25-2018, 04:44 PM
#45
Gets Weekends Off
Joined APC: Sep 2006
Posts: 555
Originally Posted by pinseeker
Flying Boxes,
I highly encourage you to review all of the information put out by the union. I also request that you look at the following areas.
First, there is no guaranteed floor benefit. There is no government regulation that requires it. That needs to be negotiated. In the communications, the union states that in the absence of a floor benefit, a stabilization fund could be established. The company pays for a floor benefit, we pay for a stabilization fund. Which one do you think the company will opt for?
Second, a DB plan has minimum funding requirement per the PBGC. A variable plan has no defined payout, it is strictly stock market dependent. Without a floor benefit, the only risk that the company assumes is the longevity risk. The union even says that a VB plan can not be underfunded because there is no guaranteed payout.
Third, the company still controls the investments. Currently, the company has a vested interest in how the investments perform because if the plan becomes underfunded, they have to make an increased payment or pay PBGC penalties until the plan becomes properly funded. With the VB plan, it can't be underfunded, so there is no vested interest in how the investment perform. Actually, there may be an incentive to place most of the money in very low yielding, safe investments to help mitigate the longevity risk. The union model used a 50/50 securities to income investment portfolio. What if the company decided to use a 20/80 percent security to income investment portfolio? Our potential upside would be greatly reduced as well as the companies longevity risk. That solves the companies problems, but what about ours. Don't think it will happen? Triple 7 pay rates and lie flat seat arbitrations are just two of the many lost arbitrations that were give aways in past contracts. Why wouldn't the company try to find loose language to save money on our backs again?
I highly encourage you to review all of the information put out by the union. I also request that you look at the following areas.
First, there is no guaranteed floor benefit. There is no government regulation that requires it. That needs to be negotiated. In the communications, the union states that in the absence of a floor benefit, a stabilization fund could be established. The company pays for a floor benefit, we pay for a stabilization fund. Which one do you think the company will opt for?
Second, a DB plan has minimum funding requirement per the PBGC. A variable plan has no defined payout, it is strictly stock market dependent. Without a floor benefit, the only risk that the company assumes is the longevity risk. The union even says that a VB plan can not be underfunded because there is no guaranteed payout.
Third, the company still controls the investments. Currently, the company has a vested interest in how the investments perform because if the plan becomes underfunded, they have to make an increased payment or pay PBGC penalties until the plan becomes properly funded. With the VB plan, it can't be underfunded, so there is no vested interest in how the investment perform. Actually, there may be an incentive to place most of the money in very low yielding, safe investments to help mitigate the longevity risk. The union model used a 50/50 securities to income investment portfolio. What if the company decided to use a 20/80 percent security to income investment portfolio? Our potential upside would be greatly reduced as well as the companies longevity risk. That solves the companies problems, but what about ours. Don't think it will happen? Triple 7 pay rates and lie flat seat arbitrations are just two of the many lost arbitrations that were give aways in past contracts. Why wouldn't the company try to find loose language to save money on our backs again?
Short Review:
Company only pays a % of pay into fund. (That is only real funding requirement)
Stabilization fund is either additional company money (negotiated) or from excess return on funds above a Cap Rate (negotiated).
Cap Rate means we are "self funding" the lean years with money from fat years.
Pilots accumulate "shares" by taking 2% of the lessor of annual salary or IRS Salary limit.
The value of the pension is the greater of the # of shares you've accumulated * Previous years value or 2% of your career earnings.
03-25-2018, 05:04 PM
#46
Gets Weekends Off
Joined APC: Jul 2009
Posts: 1,224
Originally Posted by kronan
Flying Boxes,
the "dufuses" comment was part of a quote\reaction from another poster.
You have implied that the VB Pension payout is determined by our Employer Contributions Divided by the Number of Pilots. It's not. Just as our Current Pension payout has nothing to do with the Number of Pilots.
In Both there is an indirect Connection, in that Should FedEx ever go Bankrupt and the Number of Pilots goes to 0...we'll have a Problem Houston.
In the VB (proposed) just as in our current Traditional Plan, accumulated benefits are determined Solely by your earnings. Not Pilot earnings\# of Pilots. In the case of the VB, there is a 2% floor (proposed). That 2% floor is NOT the equivalent of our Current 2% of our High 5.
In both the VB, and our Traditional Plan, contributions by the Company are made to funds designated Solely for use in Paying our Pensions. Both are guaranteed by the PBGC. Neither are a Pay as You Go system. Both are highly regulated. And Both will have to meet Government mandated Funding levels.
In Both cases, should the Stock market take a 50% hit, the Funding Levels would necessitate additional Contributions by the Company to meet the obligations outlined in the Pensions. In the Case of the VB, that would be the 2% floor.
Which Again, is less than the 2% "Floor" our Current A plan has since our Current A plan is based on high 5 versus the running\annual total the VB plan would have.
The Benefits to the VB plan is that it doesn't Stop at 25. And is not limited to 5 years of 260*.02 Contributions.
the "dufuses" comment was part of a quote\reaction from another poster.
You have implied that the VB Pension payout is determined by our Employer Contributions Divided by the Number of Pilots. It's not. Just as our Current Pension payout has nothing to do with the Number of Pilots.
In Both there is an indirect Connection, in that Should FedEx ever go Bankrupt and the Number of Pilots goes to 0...we'll have a Problem Houston.
In the VB (proposed) just as in our current Traditional Plan, accumulated benefits are determined Solely by your earnings. Not Pilot earnings\# of Pilots. In the case of the VB, there is a 2% floor (proposed). That 2% floor is NOT the equivalent of our Current 2% of our High 5.
In both the VB, and our Traditional Plan, contributions by the Company are made to funds designated Solely for use in Paying our Pensions. Both are guaranteed by the PBGC. Neither are a Pay as You Go system. Both are highly regulated. And Both will have to meet Government mandated Funding levels.
In Both cases, should the Stock market take a 50% hit, the Funding Levels would necessitate additional Contributions by the Company to meet the obligations outlined in the Pensions. In the Case of the VB, that would be the 2% floor.
Which Again, is less than the 2% "Floor" our Current A plan has since our Current A plan is based on high 5 versus the running\annual total the VB plan would have.
The Benefits to the VB plan is that it doesn't Stop at 25. And is not limited to 5 years of 260*.02 Contributions.
I am a no voter. I will not risk my pension on some ridiculous scheme... let’s focus on improving our A and B plans.
03-25-2018, 05:19 PM
#47
Fill'er Up Again
Joined APC: Jun 2008
Position: Scarebus Captain
Posts: 1,089
Originally Posted by golfandfly
I simply don’t trust the union to successfully develop a retirement proposal that the company won’t exploit.
I am a no voter. I will not risk my pension on some ridiculous scheme... let’s focus on improving our A and B plans.
I am a no voter. I will not risk my pension on some ridiculous scheme... let’s focus on improving our A and B plans.
03-25-2018, 06:37 PM
#48
Gets Weekends Off
Joined APC: Jul 2007
Position: Gear Monkey
Posts: 3,191
Originally Posted by pinseeker
Flying Boxes,
I highly encourage you to review all of the information put out by the union. I also request that you look at the following areas.
First, there is no guaranteed floor benefit. There is no government regulation that requires it. That needs to be negotiated. In the communications, the union states that in the absence of a floor benefit, a stabilization fund could be established. The company pays for a floor benefit, we pay for a stabilization fund. Which one do you think the company will opt for?
Second, a DB plan has minimum funding requirement per the PBGC. A variable plan has no defined payout, it is strictly stock market dependent. Without a floor benefit, the only risk that the company assumes is the longevity risk. The union even says that a VB plan can not be underfunded because there is no guaranteed payout.
Third, the company still controls the investments. Currently, the company has a vested interest in how the investments perform because if the plan becomes underfunded, they have to make an increased payment or pay PBGC penalties until the plan becomes properly funded. With the VB plan, it can't be underfunded, so there is no vested interest in how the investment perform. Actually, there may be an incentive to place most of the money in very low yielding, safe investments to help mitigate the longevity risk. The union model used a 50/50 securities to income investment portfolio. What if the company decided to use a 20/80 percent security to income investment portfolio? Our potential upside would be greatly reduced as well as the companies longevity risk. That solves the companies problems, but what about ours. Don't think it will happen? Triple 7 pay rates and lie flat seat arbitrations are just two of the many lost arbitrations that were give aways in past contracts. Why wouldn't the company try to find loose language to save money on our backs again?
I highly encourage you to review all of the information put out by the union. I also request that you look at the following areas.
First, there is no guaranteed floor benefit. There is no government regulation that requires it. That needs to be negotiated. In the communications, the union states that in the absence of a floor benefit, a stabilization fund could be established. The company pays for a floor benefit, we pay for a stabilization fund. Which one do you think the company will opt for?
Second, a DB plan has minimum funding requirement per the PBGC. A variable plan has no defined payout, it is strictly stock market dependent. Without a floor benefit, the only risk that the company assumes is the longevity risk. The union even says that a VB plan can not be underfunded because there is no guaranteed payout.
Third, the company still controls the investments. Currently, the company has a vested interest in how the investments perform because if the plan becomes underfunded, they have to make an increased payment or pay PBGC penalties until the plan becomes properly funded. With the VB plan, it can't be underfunded, so there is no vested interest in how the investment perform. Actually, there may be an incentive to place most of the money in very low yielding, safe investments to help mitigate the longevity risk. The union model used a 50/50 securities to income investment portfolio. What if the company decided to use a 20/80 percent security to income investment portfolio? Our potential upside would be greatly reduced as well as the companies longevity risk. That solves the companies problems, but what about ours. Don't think it will happen? Triple 7 pay rates and lie flat seat arbitrations are just two of the many lost arbitrations that were give aways in past contracts. Why wouldn't the company try to find loose language to save money on our backs again?
Without a Cap Rate, the VB projections are far more “rosey”, but then the stabilization fund doesn’t exist
The devil is in the details (and the assumptions) - and we haven’t been given all of those yet
03-26-2018, 03:59 AM
#49
Fill'er Up Again
Joined APC: Jun 2008
Position: Scarebus Captain
Posts: 1,089
Originally Posted by DLax85
The devil is in the details (and the assumptions) - and we haven’t been given all of those yet
03-26-2018, 08:13 AM
#50
Gets Weekends Off
Joined APC: Sep 2007
Position: 777 Captain in Training
Posts: 1,457
Originally Posted by FrankTheTank
Yup.. Those assumptions to be negotiated.. This alone should kill the VB plan idea. Last time I checked, our Union ain’t that great at the negotiating thing...
Thread
Thread Starter
Forum
Replies
Last Post
Past V1
Mergers and Acquisitions
92
04-03-2008 12:19 PM
