Freight Dog

Interesting chart. And FedEx has a 6 year contract vs our proposed 5.

NotMrNiceGuy

Great job on gains, to be sure. UPS has the edge when it comes to the B Fund by 50%. Significant to say the least. Overall, comparable plans at this point; somewhere around the $130K max retirement. I know FDX has to deal with that $260K IRS limiter for their high five earning years. I wonder if the UPS flat dollar plan will be a work around in the future.

kronan

A better perspective would be a FedEx comparison between CBA2015 and 2006, vice the comparison between 2011 and 2015.

FWIW-takes a 31 yr Capt career to equal a FedEx Capt's 25 year pension...and by living in domicile (reserve guys can, at times, really max out the bucks for very little actual flying), training dept, 777 FO, etc.,-quite possible for a FedEx FO to have the same 130k pension at 25 years

Not sure how UPS treats B plan contributions above the IRS 415 cap...but as an example, assuming they stop just as they do at FedEx, using a 260 cap UPS gets an extra 9,400$ each year (7,800 after FedEx goes to 9%)

Pilot7576

Kronan,

UPS A plan is maxed out at 30 yrs, so 31 years is one year extra without additional A plan. B plan is a percentage linked to the FEDERAL limit of $265k, not $260k. The fedex A plan is contractually limited to a percentage (up to 50%) of $260k.

You keep mixing up apples and oranges (A/B) and you keep getting your figures wrong.

kronan

So, you're going to slam me for using an example of a common figure just to put some comparative numbers out there...but fail to slam for an actual math error in my example.

So, let's be precise. A 30 yr UPS Capt's FDA pension will be 126k at the end of their contract, less than that for awhile.

A 25 yr Capt (hired at 35 retiring at 60) UPS Capt's pension will 105k. FedEx Capt's will be 130k

FedEx's B plan is capped at 265 per IRS guidance. So at 12%, UPS contributions will be 31.8k. At 8%, FedEx Capt's will be 21.2k, a difference of 10.6k per year. At 9%, FedEx kicks in 23.85k, a difference of 7.95k.
I hope UPS has a cash over cap provision in their B plan such that a Capt would get the 300k*12% their mgt has ponied up (shortage of 4.2k if their contributions stop at the IRS limit)

Just for grins, let's assume said UPS Capt makes Capt at the 10 year point. 15 yrs times the extra 10.6k will, hopefully, at least keep pace with inflation so that's effectively an extra 159k in the UPS Capt B fund (quite depressing to look at my historic return). That's an extra 6.4k at typical suggested drawdown rates. Fortune smiles and you do better than inflation and you turned that 159k into 318k, that nets you an extra 12.72k. You are an Investment god and you turn that 159k into 477k, that nets you an extra 19.08k

So, you the 25 yr UPS Capt will still not make up the 25k difference between your 105k Pension and the FedEx Capt's 130k pension.
Only way to make up the difference is to retire later, an extra 3 years unless you're investment god.

Pilot7576

Kronan,

I know you're so proud of the fedex A plan and rightly so and you have all sorts of machinations to make your 401k/B plan even better as well.

Good for you...I'm not bashing you on your plan, I'm saying math seems to be hard for you as you try and make the fedex retirement into the be all and end all. We all know it's good but you don't have to go into all the extra money you can bank from sick and so forth to try and get your B plan worth more than it is.

JTF

Commando

No UPS does NOT pay after the B plan hits the Federal Limit. So every Capt. and now many FO's are really getting a 10% B-plan.

I really feel UPS should continue to contribute after Tax after the 56K(?) limit is hit.

Pilot7576

Commando,

That train left the station in the last contract...it will be nigh impossible to get that back now that all cpts and a good number of fos are constrained by the $265k number.

In the previous contract, only a handful of cpts got some after tax cash..the cost of this today would be exponentially higher for ups.

Commando

No it wouldn't. Your Confused. Like usual. lol- It would not be exponentially expensive. We are not talking about the Flat Dollar or the FAE IRS rules here.

We are talking about the combined 401K and B-Plan hitting the limit of 56K. Usually occurs in Late Fall of the year. So we are talking about 3 or 4 months of UPS paying what they owe. Which is 12%. Like SWA does, the $ is sent to the Pilots as After Tax. I have also heard some Airlines have created a C-plan for this?

What I'm tired of hearing is that we have a 12% B-plan. In a few years 80% of the Seniority list will really be getting an 8-10% B-plan. Same as FDX, but a much lower A-plan then they have.

The IPA should have fixed this. And I don't want to hear that UPS dug in their Heels. Whatever. The IPA say's this about every item they didn't achieve.

Pilot7576

Commando,

When i say exponentially more expensive, I am referring the the number of crewmembers now affected by this issue. With the top cpt rate of $190 an hour prior to '06, there were few cpts who got the overage, so it was a "minor cost" (as if that exists with ups). Now, every cpt would be eligible and so would a great many fos...because it went away last contract (like retro), it would be hard to get back.

JMO