Tuck

I know you have some sort of hybrid but when was it changed? Why decision to give new hires a different system than current pilots? Was there an increase for current pilots to close the DB plan to new ones? Was it a contentious vote during your concession art contract or something else? Thx just trying to understand history.

Singlecoil

The old system was an A plan (pension), which was 1.9% x years of credited service x the average of your best 5 of your last 10 years of service, and a B plan (401K) where the company contributed 3% toward your 401K regardless of what you contributed. That changed on 1/1/2010 in that those hired after that date receive a 13.5% contribution to their 401K, regardless of how much they contribute, and do not receive a pension.

Those that were on the property before that date had the option to keep the current system, rebalance to an A plan that paid as above but 1% instead of 1.9% for years after 1/1/10, while the 401K contribution increased to 9-12% depending on years of service, or to go with a hard freeze of the A plan (best 5 of 10 years looking back from 2010) and get a 13.5% contribution to the 401K after that date.

Was is contentious? It didn't seem so. There were those that wanted out of the pension since they saw numerous other airlines lose theirs. I think the growing consensus now is that 13.5% is too low and needs to be fixed in the next contract or people won't be interested in flying for Alaska when United, Delta, and American contribute much more to their pilots' retirement funds.

EskimoJoe

slight correction. Option C...ie the freezing of the earned pension credit and transition to 13.5% is a soft freeze, not a hard freeze. Meaning the more money you earn over the years as far as any raises go, the "frozen" A plan portion will adjust upward accordingly. A hard Freeze is just that. No adjustment ever.

contrails12

Do you have profit sharing? What % if you do?

EskimoJoe

It's adjusted every year by the company, (in a futile attempt to move the goal so they don't have to pay as much) but the last 3-4 years it's been close to 10%. Think 6 weeks pay and you'll be close.

Singlecoil

Excellent point. Option C uses the highest of three ten-year look back dates for figuring final average earnings; 1/1/2010, age 60, and actual retirement date. The 1/1/2010 option allowed some of the smarter folks who were at or over 60 on that date to lock in pre-paycut wages for final average earnings.

Tuck

Great info - thanks guys.