JoePatroni

Who ALL knew they needed ALPA on board to make it happen. The SW group led by Emens was especially nauseating because SW pilots had not lost one cent to the retirement/bankruptcy movement that originally started the age change ball rolling.

AllenAllert

They didn't need ALPA on board to change the age. ALPA wanted to be involved to mitigate the impact and asked to be a part.

JoePatroni

Why would ANY of those parties give two ***** when a pilot had to retire? They certainly weren't concerned with changing fifty year old rest/duty rules. Having ALPA on board made everyone look like good guys. Talk to people at the meeting that Prater was elected at, the whole process and politicking stunk like a dead fish.

AllenAllert

It's all about the money. There was a lobby effort underway to decrease the age to 60 for pilots to get 100% of their PBGC payout. That the PBGC could afford but if they had to payout 100% for pilots at 60, it wouldn't be long before all retirees would expect to be treated the same and would have likely had to changed it to 60 for them. That the PBGC could not afford.

It was the PBGC going after Bush and Bush coordinated it with the FAA. ALPA(Prater) had no idea that it was done until after the deal was made. It may have been to his liking but he did not manufacture it.

JoePatroni

You do understand that the amount of pilots in the PBGC fund is a drop in the bucket compared to steel and auto workers right? Go back to the very beginning of the process, it was NOT the PBGC who got the ball rolling- not even close. The PBGC is not a lump sum, nor is that even possible, it's a Ponzi scheme just like social security. As a matter of fact, changing the age to 65 puts more of a strain on the PBGC than keeping it at 60.

baseball

There is a possibility that one could get a lump sum out of the PBGC. It's called a risk Transfer. Basically, the employer attempts to shed all liability, and in so doing is required to pay out the lump sum. It's a "cleaner" way to do it, rather than getting a QDDRO. The CAL pilots frozen A fund did preserve a lump sum option. I think you'd be a fool to take the annuity.

Delaying the pay out from 60 to 65 bought the company and the PBGC time. There would have been more pressure to pay out the frozen A fund sooner, rather than later. This way you get more money in the fund for longer, thereby giving the actuaries more buoyancy to the fund, rather than acting as an anchor pulling it down. I think the magic number is 85% of the unfunded liabilities need to be on hand to preserve the lump sum option.

The PBGC didn't have anything to do with the backroom "fair treatment of experienced pilots act." What will they call the next act, the fair treatment of super senior and more experienced pilots act"??

It's not enough for ALPA to say they aren't supporting any future age increases. I would like ALPA to say they firmly oppose any such increase. I'd rather the signal be loud and clear. Current and recent info on the subject just isn't strong enough to get me to support the PAC.

As I recall, it was CAL management that really started this. They kept telling the union "liquidity shortfall" and leaking out the word "bankruptcy." When Contract '02 (really 2005) occurred, Panarello's group, worried that CAL may actually do something to hurt their "frozen A fund" started to look for ways to repatriate their frozen moneys. Surprisingly, a group of the phriends of phred in the instructor cadre got their "divorces" and mistakenly bragged about it to some ALPA R/I guys. It wasn't long after that that CAL fired them and then sued them. ALPA was firmly against the QDDRO pilots. But, the QDDRO guys (and a few gals), won. Also won reinstatement to the airline.

The real reason that pilots were desperate to get the money out of CAL's hands and also away from the PBGC was a guy named Jacques LaPointe. You may be asking yourself right now...."who is this?" This is the guy that managed the fuel hedging program and ran all of the retirement plans at Continental. He's the guy that single-handedly lost over 450 million dollars with no accountability, and he's the reason that CAL came to the pilots for concessions. The amount of money he really lost was really likely about 700 million when you add it all up.

Strange though: Over 45,000 employees at Continental, and only 4400 pilots. Why was the pilots fund the only one carved out of the CARP and turned into the CPRP? I think it has allot to do with unfunded liabilities. It's a great deal when the fund doesn't have to pay the heavy earners. it's not so great of a deal when the fund has to start paying off the big money earners.

Eventually the PBGC Ponzi scheme run ends. The chickens come home to roost eventually. Delaying it to 65 just delays the "frozen benefit." It gave the actuaries both at PBGC and at CPRP more time to get their house in order financially.

Flytolive

Thankfully, Brad Hutchens was elected over Cummins 53% - 47% as C-171 Captain representative.

Ottolillienthal

The PBGC only guarantees a portion of your benefits if you are a higher income earner. If your pension benefit is lower than PBGC limits then you don't stand to lose anything if your company goes bankrupt.

But, during contract '02, CAL management went too far. They were trying to extract as much blood from the turnip as they could. Unfortunately they scared their instructor scab squadron and they came up with a legal way to extract their frozen benefit before turning age 60, or 65. It was the qualified retirement distribution order.

In order to keep your retirement benefits from being reduced, you need to keep your fund solvent. In order to do this you need to keep your employer out of the bankruptcy courts. The courts have had a penchant for raiding funds, all funds, to include retirement fund to pay off debt. So, I submit CAL went too far in pushing these pilots over the edge. We even had some in some severe financial stress that committed suicide.

I am glad our retirements are now at Schwab. Keep management out of our retirements, and keep all parties, both ALPA and management clean on this. Too much bad history and bad blood. ALPA's dark night of the soul, the Continental strike, isn't over. Those pilots that ALPA forgave, many of them also had their part in the dark night of the soul. Not until all the scabs, and their money are gone will the sun finally rise.
The ALPA strike-breakers feel betrayed that their buddies and friends of fred aren't here to help them any longer. Their relationships and loyalty are worthless now. Now they have to fend for themselves. They are just another number on the seniority list now.

JoePatroni

Baseball,

That is a great description of what happened, the senior guys would have sold their mothers to prevent a distressing of the A plan. For a while there was an online calculator that showed your PBGC value (age 60) vs your A plan value- it was taken down when Panarello and his scab friends realized that for most guys (majority) the two values were close enough to negate any leverage they were using the retirement scare for.

I wouldn't **** on Panarello or any of those scumbags if they were on fire.

Otto, dead on also.

AllenAllert

This is the link for the PBGC site that this comes from:

FAQs - Insured Plans & Benefits at Pension Benefit Guaranty Corp
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PBGC's maximum benefit guarantee is set each year under provisions of ERISA. The maximum guarantee applicable to a plan is fixed as of that plan's termination date except for cases where termination occurs during a plan sponsor's bankruptcy, in which case the maximum guarantee may be fixed as of the date the sponsor entered bankruptcy. An earlier date also may apply to certain airline industry plans.
The maximum guarantee is lower if you begin receiving payments from PBGC before age 65 or if your pension includes benefits for a surviving spouse or other beneficiary. The maximum guarantee is higher if you are over age 65 when you begin receiving benefits from PBGC.
Click the link below to see a table of the maximum amounts that PBGC can guarantee for a straight-life annuity with no survivor benefits and a joint-and-50%-survivor annuity for ages 45-65. The maximum is based on your age at the date you begin receiving benefits from PBGC.
For certain disability benefits, special rules apply. Other guarantee limitations that may apply are described in the questions and answers that follow.

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Basically, this says the method of distribution is determined by the options of the original plan. Most airlines had a full/partial lump sum option. They all have some form of an annuity option.

The kicker for the pilots is being forced to retire(at the time 60). If they started to take benefits at 60 their benefits would be forever reduced. In a similar way that Social Security pay out is reduced rate for collecting benefits at 62 instead of waiting to collect full benefits at the 65-67 age range.

As I've stated before, there was a strong lobby effort to make an exception for pilots to get full benefits at 60 instead of being required to wait till 65 because they were mandated to retire at the earlier age of 60. Yes, there are few pilots that would be collecting the 100 percent benefits at an earlier age and that was not the big problem the PBGC would be dealing with. It was all the other bankruptcies and companies turning their pension funds over to the PBGC. If they made a special change for the pilots to get 100 percent at 60, they would have likely had to do the same and pay ALL those that had their pensions turned over to them 100 percent at 60. That the could not afford and that is why the age was changed.....

Sorry, Prater was along for the ride and once the board realized the age change was going to happen, they forced Prater, willing or not, to address the public and get ALPA a piece of the PR pie and a place at the implementation table.