As a UPS pilot who pays close attention to what goes on 'next door' as we seem to pattern off each other on many things...

To achieve your existing 2% FAE "high five" max benefit of $130k @ 25 years of service, that would be $5200 per YOS under the UPS/IPA Flat Dollar Amount retirement.

Obviously there are differences between our FDA DB plan and your FAE DB plan (our current plan gives a larger benefit to CAs than FOs regardless of income, our benefit maxes at 30 YOS)...but I wonder how the total costs and benefits for that model, which supposedly is less of a financial burden on the employer WRT funding and requires renegotiation every 10 or so years due to IRS and ERISA rules, would compare with your proposed VB that seems to be on a one-way track to Ratification Town.

Again, I'm an outsider so the following is worth exactly what you paid for it...but as somebody hired at age 31 who is now in my mid-30s and supposedly stands to benefit most from a VB-type plan, I'd be completely opposed to what I've seen discussed here.

 

Huh? The MEC has not even authorized our NC to negotiate with the company. Not to mention the company has not indicated a willingness to discuss the plan. Our NC presented the concept to the company on October 31, 2017. Nearly 7 months and not a peep from the powers that be.

Why? The investment risk? Just curious.

 

...which speaks to Transparency

...which speaks to __________

 

Wow. Well at least honesty is refreshing.

I'm making the assumption that he didn't support it, because it is doubtful he'd give you the sarcastic and honest answers if he did.

 

Those quotes sound very familiar. That same rep was ask whether there was any way to verify the results of the votes due to lack of trust in the union, he reply was the crew force elected the rep to represent them so they should trust their reps.

 

Read the post immediately above mine; what that poster wrote seems to validate a repeated concern.

Yes.

Both UPS and FDX are fortunate to have negotiated a DC plan to complement their DB plans; this provides retirement income diversification that isn't all at risk to a down stock market. Yes, I agree that over time $130k today will have less buying power than $130k twenty years from now...but it will still be $130k at no market risk to you. Our defined contribution plan will grow (and contract) with the market, insulating us somewhat from the inflation that eats at the value of a static DB benefit.

I also like that one can retire at age 60 with 25 YOS @ FDX (30YOS @ UPS) with maximum defined benefit, providing an option (incentive?) for senior pilots to retire vs. working until mandatory retirement, which helps career progression down the seniority list.

My opinion, again worth exactly what you paid for it, is if a VB can *guarantee* a floor of $130k then perhaps it is a better mousetrap...but if the floor benefit can go lower than $130k then why trade a 'sure thing' with no risk outside bankruptcy for the possibility of greater benefit, but also the risk of less benefit? And if you absolutely cannot raise the DB benefit as-is, and can't keep the current benefit without incurring market risk as in a FB, and can't raise the DB benefit via a UPS-style flat dollar amount program...why not keep the DB the same higher DC with cash over cap the next to get that $$$ immediately and start taking advantage of market returns?

When I personally weigh risk v. reward on this topic, I'm not personally seeing the value proposition....even at my age. YMMV, caveat emptor, etc etc.

 

No, Tuck's post was drivel and full of incorrect information. He is obviously an MEC member or apologist who is all in with the sales job that is going on right now by our MEC.

 

And Tuck, I've been to 2 hub turn meetings, an LEC meeting, and a focus group meeting. Does that allow me to have an opinion on this abortion?

The ousted Retirement Chair unequivocally stated that there is NO floor on the new plan. If you happen to retire at a time when the market is down, you could have a reduced benefit. His answer to that: defer your retirement until the market rebounds. He also equivocally stated that there was NO provision for folks who go out on LTD, and that was re-affirmed at the LEC meeting AND the focus group meeting.

The most common phrase I heard during all of these meetings and discussions was "releasing the company from their liability" in regard to investment risk. The next most common mantra was the highly likelihood of FedEx going bankrupt and us losing our A fund altogether. That is almost a forgone conclusion if you listen to the MEC, its just a matter of time. Only this new plan can possibly save us from this most certain disaster. Never mind that all the management types are in the same plan as we are.

Finally, the question from the survey that they are touting shows the overwhelming support of the plan is basically this (and is remarkably similar to the wording on the Age 65 survey): Since it is all but certain that we will lose our A fund due to bankruptcy or company malfeasance, would you like the union to research other alternatives to the current A plan? Supposedly 83% or so responded that yes they think it would be wise to research other alternatives. The MEC is touting that percentage as the number of people who are in favor of this particular plan. Completely disingenuous at best and downright fraudulent at worst.

During the LEC meeting there were no questions allowed, mine was going to be how many respondents were in the sample size and what was the exact wording of the question. I can tell you that the sample size in the focus group I went to was about 20 people and there is no way that 16 of them were in favor of this plan. I'd put the number at under 5 of them.

NOTHING about this plan is settled, and ALL of the important details would need to be NEGOTIATED. We are being sold a "plan" that doesn't even exist yet, because it hasn't even been negotiated, but will magically increase our benefit, cost the company less and make money for the consultants that are pitching it at the same time. All the while throwing in the towel on even trying to improve our current A plan, so we can release the company of their liability and take it on ourselves.

The real question ought to be do you trust this union, who brought us the 2015 contract with lie flat seats, no real time trip trading and PBS secondary lines, to negotiate the deal that releases the company of their liabilities and puts them squarely on you? I'm sorry, its not personal, but I don't.

 

The BEST post of this entire thread!! Well done.

 

Wow, they wouldn't allow you to ask questions at the LEC meeting you attended. Is that even allowed under the bylaws. I think if they attempted to not allow questions at an LEC meeting I attended, I would have immediately made a motion to recall the LEC members in attendance attempting to silence the members.

I think it speaks volumes to the attitude of both the union leadership and the members if it is true that the MEC thinks that they already have the votes for a yet to be negotiated VB plan. They haven't even started negotiations with the company yet, unless the lights are lit in the parking lot again.