DLax85

Almost, but there's a very important facet of our current A Fund Defined Benefit Plan

It only matters on how much you earned during your "High 5"...all the other years don't matter...when you earn your "high 5" doesn't matter.

This is absolutely NOT true in the Variable Benefit Plan the union is talking about. It's funded much differently, and is in some ways really just a defined contribution plan that pays out an annuity at the end

Big difference!

Of course, it has other features as well --- some positive: a higher cap, the possibility for some increase once retired

But it has many negatives: the fact it's funded like a defined contribution plan each year, that how much & when you make your "high 5" does matter, the fact the company won't be responsible for "plussing up" the fund in a down market, the fact a third party entity will manage it

Please listen carefully and ask very specific questions

Please ask why the company would agree to this

Please ask who the expert/advisor we are paying has advised in the past

Please ask the health of the other Defined Benefit Plans who've converted to this Variable Benefit Plan

Please ask & understand what the "hurdle rate" is (within the context of a Variable Benefit Plan, and precisely the "hurdle rate" all parties would agree to)

Please ask & understand the "expected market rate of return" we could expect given the current large run up in equities.

(Remember, buy low - sell high should be your investment strategy. Right now, rhe company would certainly be selling high, and we'd be buying high. And remember, they aren't responsible for future shortfalls)

Please ask if any additional company $$ are allocated towards our retirement, why can't those be allocated to our current B fund, with "cash over cap" that each of us can control individually as we see fit

Please ask what happens to the "vested value" of our current A fund if we transitioned to a new Variable plan

(Hint, Hint --- if you currently don't have your "high 5" met, its highly unlikely your years of service will transfer --- because this plan is really a defined contribution each year)

There are a lot of questions that need to be asked

We shouldn't have to call our block reps individually to ask them

Meat Fighter

Winner winner, chicken dinner.

Keep it simple, and drive it home. That's our best Pk.

Sent from my SAMSUNG-SM-G935A using Tapatalk

DLax85

There are specifics, they aren't being released publicly

Yes --- the money FedEx commits --- its going to essentially be a defined Contribution --- and that's what the company wants to switch to. The company doesn't want market risk. The accountants like "knowns"

Yes - it will be distributed to a 3rd party entity, which won't be backed by PBGC. They hope to avoid those premiums

Our MEC got very emotional during the summer hub turn mtg when he was challenged on a few questions. I sense this is becoming a very emotional issue and research/negotiating fatigue is already setting in

The company will once again use that to their advantage

It's quite worrisome to me

Pilot7576

Finally have to chime in after reading all the pros and cons about a "new and improved" plan for you guys. The fact that Fedex is willing to talk about changing your A plan retirement (which is damn good) outside of contract negotiations should be a big warning flag.

Why would management do this unless there is a distinct benefit to them in the long term? I know if ups wanted to talk about ANYTHING outside of contract negotiations, they would have a definite benefit we have that they want.

JMO

DLax85

I think this statement requires greater fidelity

I think the pilots who voted "No", who had already reached their "high 5" and had 25 years on property are very interested in getting more --- and the sooner the better, because they may retire very soon

I think the pilots who voted "No", who wanted a bigger B fund, while keeping our current Defined (Guarunteed) Benefit Plan, won't support it

I think the pilots who voted "No", for numerous other reasons besides retirement, are a bit confused on why we are negotiating outside on Section 6

And unfortunately, I think 90% of our crew force is paying very little attention to the specifics of this issue, as we approach a very busy holiday/peak period when our personal lives get very busy

.....hmmmmm. Timing can be a very powerful tool.

StarClipper

For a while here I thought I was the only one worried

DLax85

You're right, there are a lack of specifics

Unfortunately, folks will have to do a little background reading on their own and there were some links very early in this thread which were useful

This thread (and a few hub turn meetings) started back in July, but the vast majority of pilots I've flown with know very little about this issue

If so, they perceive it to be only about "increasing the cap" --- they know very little about the underlying fundamental changes being proposed

I'll bump up a few posts

DLax85

Bumping up this post and reposting one of the original links in this thread:

http://pensionresearchcouncil.wharto...Blitzstein.pdf

DLax85

Shorter, simpler, more colors...same concerns though

http://findleydavies.com/Variable_Be...e%20_Paper.pdf

Note the sub-title in the article --- very revealing!

Also, note the big conclusion/chart on page 7:

Variable Benefit Plans represent the "Best of Both Worlds"

It's like a DB plan and a DC plan wrapped together...but wait, don't we already have that ????

pinseeker

In one of the MEC videos Mr. Bltzstein specifically states that the variable plan would be protected by the PBGC. In that same video he also states that FDX doesn't pay penalty premiums to the PBGC because our plan if fully funded.

Where did you find that the new proposed plan wouldn't be covered?

By the way, I am totally against the proposed plan, just trying to gather facts.