FDX1

So, no rebuttal for the fact that you are spewing inaccurate statements. ?

Yes, my demand for a contract has certainly caused the downfall of our Industry. Nice reply

machz990

Where does this two year timeline have its origin that many seem to be spreading if we vote this down? That is a long time for a contract that is basically done but may require a couple tweaks. Lets don't pull numbers out of our rears unless they have inside information. Saying it will take two years does a disservice to the crew force. We have zero knowledge of the company's motivation or timeline to resolve this matter if we vote it down.


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busdriver12

The company's motivation and timeline will be to continue to stall for as long as they can get away with. Bonuses for everyone (except pilots).

Upsddown

Commando,

It's much more complicated than that.

IRS 415 limits for 401K contributions are $18,000 annually in 2015. Catch-up contributions for employees over age 50 allow an additional $6,000 for a total of $24,000 for over age 50 employees.

Defined contribution plan limits for 2015 are $53,000. Catch-up contributions for employees over age 50 allow an additional $6,000 for a total of $59,000 for over age 50 employees.

The annual IRS compensation limit is $265,000.

The total from all plans (401K and Defined Contribution) cannot exceed the $53,000 ($59,000 over age 50) IRS 415 limit. If Fedex has proposed an 18% Defined Contribution that would mean Fedex would contribute 18% of annual compensation up to the $265,000 IRS limit or $47,700 annually. For the remainder of the compensation above the $265,000 limit Fedex could not contribute any more to your Defined contribution plan they would likely just pay you an extra 18% salary for the compensation above $265,000.

Though the IRS limit is $53,000 ($59,000 over age 50) Fedex could only contribute $47,700 of the $53,000 ($59,000) based on an 18% DC-plan. You would have to contribute the remainder as a 401K contribution to reach the $53,000 ($59,000) IRS limit. Another twist, though it's not an IRS restriction, some plans (AA did this) will not allow you to contribute to your 401K once you reach the $265,000 IRS annual limit. So in order to maximize your contributions of $53K/$59K you have to make sure you contribute to your 401K the difference from the $47,700 in this example and the $53K/$59K limit before your reach $265,000 in compensation.

If in the future your Captains make $360,000 annually the Company will not contribute 18% of $360,000 into their Defined Contribution plan because they will be limited by the annual IRS compensation limit. If a pilot made $360,000 in 2015 and had a 18% contribution plan that would equate to $64,800 in total contributions but the contribution plan limits in 2015 are $59,000 for over age 50 pilots so the pilot would have $47,700 contributed by the Company (18% of $265,000) he then could contribute an additional $11,300 ($59,000 limit minus $47,700) to his 401K and the additional $5,800 ($64,800 minus $59,000) would be paid as taxable income.

Now FedEx and ALPA may have negotiated something different but that is how it works with most airline plans.

There is no way I would give up an A-plan for a larger B-plan. First and most importantly, A-plans are not subjected to stock market swings.
If the stock market crashes the day before you retire your A-fund is not affected while your B-fund most likely will have a considerable loss. Secondly, the percentage B-fund to replace your A-fund is much larger than 18%. Thirdly, with the IRS 415 limits you will not be able to fund your retirement tax free with the entire 18% for high wage earners which further decreases the value of the 18%.

TonyC

Likely not.

When the pilot reaches the limit, FedEx stops paying, period.

That's why our 7% B-fund doesn't actually give 7% to our higher-earning pilots, and why a 50% B-fund would do them no good.





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iarapilot

If our options, if we reject the TA, are to continue negotiations, that would be OK, most likely! And if we sign a contract in 2 years but dont make up for the loss in those 2 years, that is the way the ball bounces. For the long term it would be better though.

I would guess that the 10 who voted to approve might say that it is the best we could get, and the 4 no votes would disagree.

Historically, it is a minority that affects any change. The majority is usually OK with the status quo.

FDXLAG

So do you think we can get them to give us a cola and increase the A Plan cap, but not get them to negotiate a cash over b plan cap?

TonyC

Just sayin' how it works now, L.






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USMCFDX

This should have been fixed - yet another reason to vote no.

FDXLAG

T,

I understand completely, but at least the IRS 401k limits are indexed to inflation. Not so our DB cap. Who knows in 15 years the 401k cap might be higher. That is also how it works now.