This TA will be ratified
09-17-2015, 05:37 PM
#1
Line Holder
Thread Starter
Joined APC: Jul 2007
Position: B767/CPT
Posts: 56
This TA will be ratified
This TA will pass. Past votes, the unwillingness for the majority to critically analyze a proposal, and benefits disproportionately distributed to certain demographics, insures ratification. If a simple 3 percent for two years got the company an extension on the previous contract and a European domicile, what will prevent this TA from passing?
According to the seniority "crystal ball" and looking at recent retirements prior to age 65, it would be safe to project a minimum of 1300 retirements under the provisions of this contract. Based on a 60k average retirement bonus that is 78 million dollars. Makes the 43 million dollar VEBA HSRA given to only the senior members of the 2006 contract look reasonable. This is in addition to retiree healthcare benefits (pre and post Medicare) being improved for all members, a good thing. But, what was the costing on that provision? We as a pilot group are doubling are contributions into the VEBA system. And according to statements made by representatives of the company the average age of retirement is over 64 1/2 years of age. So while on paper that appears generous, very little money is actually put forth by the company for pre Medicare enhancements, unless the average retirement age substantially changes.
The fatigue mitigating 6 week bid month? A recent message sent from the Union states that the company will not use this provision unless we approve. RIGHT. Care to take that into arbitration. Let me explain the exploitability of this provision. Without hard and fast rules on this provision, strategically placing 6 week bid periods during high demand vacation slot windows could undermine the ability keep the quality of life now afforded with the 4 and 5 week bid periods. Example, two 6 week and ten 4 week bid periods, one 6 week bid period placed in the summer and one placed at the end of the bid year (late Nov and Dec). Do you think if will be as easy to schedule to have the holidays off if that is your priority? Will you be able to knock out the large blocks of time? Possibly, but could the company build pairing to take advantage of this new provision? In addition, what scheduling technique is being adopted currently, fatigue mitigation or pay maximization. Take a look at the 757, 767, Airbus, and MD 11 bidpacks, sure doesn't look like fatigue mitigation is a priority.
Healthcare. The Union has a video explaining the CDHP, overall it is an informative video, but, the explanation of the worst case scenario and the reality of healthcare cost are inaccurate, one major provision of the CDHP is the substantial out of network costs, not discussed at all in the video, this may or may not be significant, depending on the rules governing out of network services not available "in network". Do you want to just "wait and see". Healthcare cost are due to double for those currently on the buy up plan and we have agreed to pay 20% shared cost for eternity. Who bought off on that? Our shared cost should be the same duration as our pay raises, not an hour longer. The company is once again rewarded for stalling in future contract talks...
Discussed in other post are examples of provisions with excessively loose language, deadhead policy, bidding, training, deviation banks, etc, we have all seen what the company will do when an item in the contract is exploitable.
For those sitting in their final seat and able to retire under this contract it is a "no brainier". For the rest of the crew force it's Groundhog Day, continued degradation of quality of life for minimal pay gains.
According to the seniority "crystal ball" and looking at recent retirements prior to age 65, it would be safe to project a minimum of 1300 retirements under the provisions of this contract. Based on a 60k average retirement bonus that is 78 million dollars. Makes the 43 million dollar VEBA HSRA given to only the senior members of the 2006 contract look reasonable. This is in addition to retiree healthcare benefits (pre and post Medicare) being improved for all members, a good thing. But, what was the costing on that provision? We as a pilot group are doubling are contributions into the VEBA system. And according to statements made by representatives of the company the average age of retirement is over 64 1/2 years of age. So while on paper that appears generous, very little money is actually put forth by the company for pre Medicare enhancements, unless the average retirement age substantially changes.
The fatigue mitigating 6 week bid month? A recent message sent from the Union states that the company will not use this provision unless we approve. RIGHT. Care to take that into arbitration. Let me explain the exploitability of this provision. Without hard and fast rules on this provision, strategically placing 6 week bid periods during high demand vacation slot windows could undermine the ability keep the quality of life now afforded with the 4 and 5 week bid periods. Example, two 6 week and ten 4 week bid periods, one 6 week bid period placed in the summer and one placed at the end of the bid year (late Nov and Dec). Do you think if will be as easy to schedule to have the holidays off if that is your priority? Will you be able to knock out the large blocks of time? Possibly, but could the company build pairing to take advantage of this new provision? In addition, what scheduling technique is being adopted currently, fatigue mitigation or pay maximization. Take a look at the 757, 767, Airbus, and MD 11 bidpacks, sure doesn't look like fatigue mitigation is a priority.
Healthcare. The Union has a video explaining the CDHP, overall it is an informative video, but, the explanation of the worst case scenario and the reality of healthcare cost are inaccurate, one major provision of the CDHP is the substantial out of network costs, not discussed at all in the video, this may or may not be significant, depending on the rules governing out of network services not available "in network". Do you want to just "wait and see". Healthcare cost are due to double for those currently on the buy up plan and we have agreed to pay 20% shared cost for eternity. Who bought off on that? Our shared cost should be the same duration as our pay raises, not an hour longer. The company is once again rewarded for stalling in future contract talks...
Discussed in other post are examples of provisions with excessively loose language, deadhead policy, bidding, training, deviation banks, etc, we have all seen what the company will do when an item in the contract is exploitable.
For those sitting in their final seat and able to retire under this contract it is a "no brainier". For the rest of the crew force it's Groundhog Day, continued degradation of quality of life for minimal pay gains.
09-17-2015, 06:29 PM
#2
Line Holder
Joined APC: Jan 2013
Position: 757 Capt
Posts: 63
I was really hopeful to read a passable TA, given our superior leverage position relative to past negotiations, ("Drafting all seats" via FCIF and we had 2.5 more months of increased flights,with respect to peak, and with a static number of willing pilots = more encouragement from Fred to bargain in good faith).
I find it intriguing that the company when beset with higher costs due to legislation (Health care) the Company sees fit to shift these costs to their employees. Yet when they reap rewards from legislation or negotiations, those spoils are not shared with employee groups that contribute to the success of FDX.
Specifically, the age 65 legislation monetarily benefited the Company. Any pilot who began accruing retirement benefits prior to age 35 and works past age 60 reduces the cost of the Company in at least three meaningful ways.
1) The pilot hired at 35 y/o (or less) will have 25 yrs with the Company and can accrue no more percentage points, with respect to the A Plan. Therefore, any years he/she works past 25 years of service become cheaper and cheaper for the company to employ (a "savings" for the Company.
2) The more years that pilot works past age 60, the less A Fund monies the Company has to pay that pilot in retirement because his retirement period is shortened. (Another savings for the Company).
3) The longer a pilot works past 60, the less training costs with respect to "turn over" in employees.
I am not particularly close to retirement (12-17 yrs from now), however, the A Plan is the 800 LB gorilla eating our retirement saving approximately $608,400,000 over the next 28 years for the Company due to inflation. I performed the inflation erosion math that applies to my age demographic and how it relates to our A Plan retirement. I'm a 48 years old male, with an avg lifespan of 76. Statistically, I should die in year 2043. The A Plan limits were established in 1998 at $130,000 USD. (One should think of 1998 as the "anchor" year, and how it relates to inflation and the devaluation of the A Plan.) If I live till the avg of 76 y/o, I should die in year 2043. From the "Anchor year to 2043 = 45 yrs of inflation erosion to A Plan monies. I then consulted the CPI-U chart (referenced by our NC) to determine the average rate of inflation from Jan 1998 (the Anchor) to Sep 2015. Here's the site
CPI-U Calculator
The total inflation rate since '98 to now = 44.21%. The avg inflation rate during that period = 2.6% (it excludes the high inflation rates of the mid '70's and early 80's.) Then multiply 2.6% X 45 (years from 1998 - 2043 {when I should statistically die}) = 117%. Since the company refuses to increase the caps to adjust for inflation, the most accurate method to determine what the A Fund will equal in year 2043 is to relate it to 1998 dollars (isn't it easier to remember what things cost 17 yrs ago vice imagine what things will cost 28 years from now?).
For flow, the math calcs have been added below for those who wish to follow the math.
My Benefit in 2043 equals $59,907.83 in 1998 Dollars or less than half the $130,000.
For those that should live past 2043, every 5 years beyond 2043 are your benefit expectations
In year
2048 = $ 56,521.74
2053 = $ 53,497.94
2058 = $ 50,781.25
2063 = $ 48,327.14
2068 = $ 46,099.29
As one can clearly see, the younger one is, the greater the erosion affect of inflation. Some of the numbers are what pilots not on the property yet, are looking at. You can be sure they will be thinking, "FDX's B Fund is 9% (4.5 years from now) UPS is 12%, DAL is 15%, UAL is 16%, and AA is 16%? At most of those Carriers I can fly daytime? I get better FAR rest limits? I don't get stiffed on accepted fares? I get profit sharing? If I fly draft/volunteer I get 200%, the company rarely disrupts my schedule because Disruption Penalties are painful enough the company actually plans their schedule better?
It is my opinion the Company's offer in the A Fund is obviously concessionary. The paltry increases in the B Fund since 1998 thru the proposed amendment date is 3%. The erosion in A plan far out strips the TA's B Fund "enhancements". If this TA were approved, the company will have effectively shifted the burden of retirement onto us without the commensurate increase in compensation to "self fund" a retirement.
I am baffled why other solutions were not employed to return us to a semblance of "whole" in light of the A Plan. For example, a B Fund commensurate with Industry, higher compensation to self fund retirement, higher 401K matching contributions ($500 match?), FDX stock (there are other ways around the A Fund caps that could avoid accounting rules, yet keep us afloat with respect to inflation.
I'm not a single issue voter, but this issue permeates the other sections. Insurance with its cost increases is a push at best. Work Rules, while there are some modest improvements, there are give backs as well.
One "yes" voter commented, "do you think you are worth THAT much more than other pilots?" The correct retort is, I don't think I'm worth 54% less than a pilot who retired in 1998.
$130,000 divided by $282,100 ( A Plan inflation adjusted for year 2043) = 46% 100 - 46 = 54% less
Turn the oven back on, this TA is half baked.
The math explained.
Keep in mind, if the Company would agree to index our A Plan to the CPI-U inflation rate since 1998 (an increase of 44.21%) to arrive at this year's theoretical maximum limit, one would NOT multiply 130,000 X 44.21%. Remember years ago in math class, to easily find the answer to a percentage problem, you would move decimal points and add a "1.00" to the interest rate, which represents 100% of the original number. In this case $130,000. The inflation from 1998 to today is 44.21%. To calculate what our indexed A Plan max should be today, one would convert the 44.21% to .4421%. Then add .4421 to 1.00 (the 1.00 equals 100% of the principal) this equals 1.4421. Agreed, it's a bit confusing, so get your calculator and do the math. Multiply 1.4421 X $130,000 = $187,473. This SHOULD be the new maximum A Fund limit if we were keeping up with inflation as reported by the CPI-U.
However, since the Company refuses to abide by our theories of indexing to CPI-U. Therefore, to avoid not getting snookered again, we must determine what our "TA
A Fund retirement" will be worth in 1998 dollars during our retirement and the affects of inflation and how it relates to the $130,000 cap during our retirement years.
In my specific case, from the"Anchor year" (1998) till statistical death (2043) = 45 years.
45 years X 2.6 % inflation = 117% inflation will dramatically reduce the benefit by slightly more than 50%.
Remember, your math class and the previous example of the decimal points and adding a 1 prior to the decimal point to account for the original 100% ? Therefore, in this case 117% would be written 1.17% and then add a 1.00 to that number
( 1.17 + 1.00 = 2.17 ). Therefore, my inflation reduction number = 2.17%
To find out how much inflation has reduced the benefit, input into your calculator $130,000 divided by 2.17% = $59,907.83 USD
That's correct. The approximate value of my retirement in 2043 will equal roughly $60,000 in 1998 dollars once adjusted for inflation.
Does the math pass the smell test? 2.6% inflation X 45 yrs = 117%. If inflation is over 100%, doesn't that mean our $130,000 is roughly half, or $65,000? Wouldn't one need to subtract another 17% from the $65,000? That's how we've arrived at the A Fund benefit that's slightly below $60,000.
Anyone living longer than 76, or participating in the retirement program that allows passing this benefit on to a surviving spouse, or anyone younger than 48 years old, will have to increase the affects of erosion and accept a smaller A Plan benefit (saving the Company money).
I ran the numbers for every 5 years after 2043 those younger than I, for demonstration purposes.
I find it intriguing that the company when beset with higher costs due to legislation (Health care) the Company sees fit to shift these costs to their employees. Yet when they reap rewards from legislation or negotiations, those spoils are not shared with employee groups that contribute to the success of FDX.
Specifically, the age 65 legislation monetarily benefited the Company. Any pilot who began accruing retirement benefits prior to age 35 and works past age 60 reduces the cost of the Company in at least three meaningful ways.
1) The pilot hired at 35 y/o (or less) will have 25 yrs with the Company and can accrue no more percentage points, with respect to the A Plan. Therefore, any years he/she works past 25 years of service become cheaper and cheaper for the company to employ (a "savings" for the Company.
2) The more years that pilot works past age 60, the less A Fund monies the Company has to pay that pilot in retirement because his retirement period is shortened. (Another savings for the Company).
3) The longer a pilot works past 60, the less training costs with respect to "turn over" in employees.
I am not particularly close to retirement (12-17 yrs from now), however, the A Plan is the 800 LB gorilla eating our retirement saving approximately $608,400,000 over the next 28 years for the Company due to inflation. I performed the inflation erosion math that applies to my age demographic and how it relates to our A Plan retirement. I'm a 48 years old male, with an avg lifespan of 76. Statistically, I should die in year 2043. The A Plan limits were established in 1998 at $130,000 USD. (One should think of 1998 as the "anchor" year, and how it relates to inflation and the devaluation of the A Plan.) If I live till the avg of 76 y/o, I should die in year 2043. From the "Anchor year to 2043 = 45 yrs of inflation erosion to A Plan monies. I then consulted the CPI-U chart (referenced by our NC) to determine the average rate of inflation from Jan 1998 (the Anchor) to Sep 2015. Here's the site
CPI-U Calculator
The total inflation rate since '98 to now = 44.21%. The avg inflation rate during that period = 2.6% (it excludes the high inflation rates of the mid '70's and early 80's.) Then multiply 2.6% X 45 (years from 1998 - 2043 {when I should statistically die}) = 117%. Since the company refuses to increase the caps to adjust for inflation, the most accurate method to determine what the A Fund will equal in year 2043 is to relate it to 1998 dollars (isn't it easier to remember what things cost 17 yrs ago vice imagine what things will cost 28 years from now?).
For flow, the math calcs have been added below for those who wish to follow the math.
My Benefit in 2043 equals $59,907.83 in 1998 Dollars or less than half the $130,000.
For those that should live past 2043, every 5 years beyond 2043 are your benefit expectations
In year
2048 = $ 56,521.74
2053 = $ 53,497.94
2058 = $ 50,781.25
2063 = $ 48,327.14
2068 = $ 46,099.29
As one can clearly see, the younger one is, the greater the erosion affect of inflation. Some of the numbers are what pilots not on the property yet, are looking at. You can be sure they will be thinking, "FDX's B Fund is 9% (4.5 years from now) UPS is 12%, DAL is 15%, UAL is 16%, and AA is 16%? At most of those Carriers I can fly daytime? I get better FAR rest limits? I don't get stiffed on accepted fares? I get profit sharing? If I fly draft/volunteer I get 200%, the company rarely disrupts my schedule because Disruption Penalties are painful enough the company actually plans their schedule better?
It is my opinion the Company's offer in the A Fund is obviously concessionary. The paltry increases in the B Fund since 1998 thru the proposed amendment date is 3%. The erosion in A plan far out strips the TA's B Fund "enhancements". If this TA were approved, the company will have effectively shifted the burden of retirement onto us without the commensurate increase in compensation to "self fund" a retirement.
I am baffled why other solutions were not employed to return us to a semblance of "whole" in light of the A Plan. For example, a B Fund commensurate with Industry, higher compensation to self fund retirement, higher 401K matching contributions ($500 match?), FDX stock (there are other ways around the A Fund caps that could avoid accounting rules, yet keep us afloat with respect to inflation.
I'm not a single issue voter, but this issue permeates the other sections. Insurance with its cost increases is a push at best. Work Rules, while there are some modest improvements, there are give backs as well.
One "yes" voter commented, "do you think you are worth THAT much more than other pilots?" The correct retort is, I don't think I'm worth 54% less than a pilot who retired in 1998.
$130,000 divided by $282,100 ( A Plan inflation adjusted for year 2043) = 46% 100 - 46 = 54% less
Turn the oven back on, this TA is half baked.
The math explained.
Keep in mind, if the Company would agree to index our A Plan to the CPI-U inflation rate since 1998 (an increase of 44.21%) to arrive at this year's theoretical maximum limit, one would NOT multiply 130,000 X 44.21%. Remember years ago in math class, to easily find the answer to a percentage problem, you would move decimal points and add a "1.00" to the interest rate, which represents 100% of the original number. In this case $130,000. The inflation from 1998 to today is 44.21%. To calculate what our indexed A Plan max should be today, one would convert the 44.21% to .4421%. Then add .4421 to 1.00 (the 1.00 equals 100% of the principal) this equals 1.4421. Agreed, it's a bit confusing, so get your calculator and do the math. Multiply 1.4421 X $130,000 = $187,473. This SHOULD be the new maximum A Fund limit if we were keeping up with inflation as reported by the CPI-U.
However, since the Company refuses to abide by our theories of indexing to CPI-U. Therefore, to avoid not getting snookered again, we must determine what our "TA
A Fund retirement" will be worth in 1998 dollars during our retirement and the affects of inflation and how it relates to the $130,000 cap during our retirement years.
In my specific case, from the"Anchor year" (1998) till statistical death (2043) = 45 years.
45 years X 2.6 % inflation = 117% inflation will dramatically reduce the benefit by slightly more than 50%.
Remember, your math class and the previous example of the decimal points and adding a 1 prior to the decimal point to account for the original 100% ? Therefore, in this case 117% would be written 1.17% and then add a 1.00 to that number
( 1.17 + 1.00 = 2.17 ). Therefore, my inflation reduction number = 2.17%
To find out how much inflation has reduced the benefit, input into your calculator $130,000 divided by 2.17% = $59,907.83 USD
That's correct. The approximate value of my retirement in 2043 will equal roughly $60,000 in 1998 dollars once adjusted for inflation.
Does the math pass the smell test? 2.6% inflation X 45 yrs = 117%. If inflation is over 100%, doesn't that mean our $130,000 is roughly half, or $65,000? Wouldn't one need to subtract another 17% from the $65,000? That's how we've arrived at the A Fund benefit that's slightly below $60,000.
Anyone living longer than 76, or participating in the retirement program that allows passing this benefit on to a surviving spouse, or anyone younger than 48 years old, will have to increase the affects of erosion and accept a smaller A Plan benefit (saving the Company money).
I ran the numbers for every 5 years after 2043 those younger than I, for demonstration purposes.
09-17-2015, 06:59 PM
#3
Gets Weekends Off
Joined APC: Nov 2013
Posts: 2,756
"I'm a 48 years old male, with an avg lifespan of 76. Statistically, I should die in year 2043. The A Plan limits were established in 1998 at $130,000 USD. (One should think of 1998 as the "anchor" year, and how it relates to inflation and the devaluation of the A Plan.) If I live till the avg of 76 y/o, I should die in year 2043."
Dude, you're a FedEx pilot. The average life expectancy statistics do not apply to you, especially if you get suckered into working until you're close to 65 under this TA, working extra and not using your sick time in order to collect the bonus. FedEx will not pay out on your A plan for long, statistically speaking, I am very sorry to say.
Dude, you're a FedEx pilot. The average life expectancy statistics do not apply to you, especially if you get suckered into working until you're close to 65 under this TA, working extra and not using your sick time in order to collect the bonus. FedEx will not pay out on your A plan for long, statistically speaking, I am very sorry to say.
09-17-2015, 08:16 PM
#6
Gets Weekends Off
Joined APC: Nov 2005
Position: 777 FO
Posts: 931
Originally Posted by Redeyz
I was really hopeful to read a passable TA, given our superior leverage position relative to past negotiations, ("Drafting all seats" via FCIF and we had 2.5 more months of increased flights,with respect to peak, and with a static number of willing pilots = more encouragement from Fred to bargain in good faith).
I find it intriguing that the company when beset with higher costs due to legislation (Health care) the Company sees fit to shift these costs to their employees. Yet when they reap rewards from legislation or negotiations, those spoils are not shared with employee groups that contribute to the success of FDX...
I find it intriguing that the company when beset with higher costs due to legislation (Health care) the Company sees fit to shift these costs to their employees. Yet when they reap rewards from legislation or negotiations, those spoils are not shared with employee groups that contribute to the success of FDX...
09-17-2015, 08:49 PM
#7
Gets Weekends Off
Joined APC: May 2006
Posts: 2,889
Originally Posted by Deuce130
Thank you. I'm not a single issue voter, either, but this is THE biggest issue for me. Not only do am I disappointed with A plan proposal, I'm ticked off it was even allowed to go forward to the crew force.
I like getting to vote. I am glad you have the choice.
I am going to HKG roadshow Saturday and will listen with an open mind. Internally, however, I've gone from a 60% yes vote to about a 70% no. I'll share my thoughts on why once I see the roadshow and make sure I am not AFU (which happens quite often....
)
09-18-2015, 05:32 AM
#8
Gets Weekends Off
Joined APC: Dec 2006
Posts: 2,051
Originally Posted by Albief15
...I like getting to vote. I am glad you have the choice.
I am going to HKG roadshow Saturday and will listen with an open mind. Internally, however, I've gone from a 60% yes vote to about a 70% no. I'll share my thoughts on why once I see the roadshow and make sure I am not AFU (which happens quite often....)
I am going to HKG roadshow Saturday and will listen with an open mind. Internally, however, I've gone from a 60% yes vote to about a 70% no. I'll share my thoughts on why once I see the roadshow and make sure I am not AFU (which happens quite often....
)
. It's a great production. And in all fairness, the NC should be proud of the gains they brought to the table. I would assume though you've read the actual TA, and applied critical thought to it. I wish that were a requirement for casting one's vote. I'm also very glad to have a vote. Enjoy HKG!
09-18-2015, 06:21 AM
#9
Gets Weekends Off
Joined APC: Nov 2005
Position: 757 Capt
Posts: 2,418
In 1998 how many FedEx pilots were making 260k? (No B plan then) In 2006, I'm sure a small percentage of pilots were hitting the caps (thanks to draft and carryover-B plan increased to 7%). Thanks to the non-existent pay raises in 2011, an increasing percentage of pilots are impacted by the cap.
But, even with the TA rates, a domestic NB Capt doesn't hit the cap until 2018
And, even with the TA rates-there are still going to be folks choosing QOL over the Capt seat and retire as FOs.
1000 hours is the rule of thumb, and confident it's applicable to the 777 guys with the hidden CHs, but I think my typical year is more in the 950sh. But then, I don't do a week of CO every month and I don't plan to sell my 40% of my vacation back
But, even with the TA rates, a domestic NB Capt doesn't hit the cap until 2018
And, even with the TA rates-there are still going to be folks choosing QOL over the Capt seat and retire as FOs.
1000 hours is the rule of thumb, and confident it's applicable to the 777 guys with the hidden CHs, but I think my typical year is more in the 950sh. But then, I don't do a week of CO every month and I don't plan to sell my 40% of my vacation back
09-18-2015, 06:32 AM
#10
Gets Weekends Off
Joined APC: May 2006
Posts: 1,804
I am a no voter and I also think this TA will pass.
My crystal ball says that in 8-10 years when we sign the next contract the A plan will be frozen. Due to this fact I will make sure I max out the 260 during the life of this contract to maximize my benefit and I will be doing it as a WB F/O. I know many that do.
My crystal ball says that in 8-10 years when we sign the next contract the A plan will be frozen. Due to this fact I will make sure I max out the 260 during the life of this contract to maximize my benefit and I will be doing it as a WB F/O. I know many that do.
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