JustInFacts

Short answer, 2.

Longer answer, in 2006 the agreed pay rates didn't exceed the FAE cap, except for the last year for an aircraft that we didn't even own.

In 2015, the company agreed to increase the pension if all new hires were excluded, and put on a DC plan.

You came to a company knowing that they had a pension plan. Why? If you want to keep the DB plan the same and increase the DC plan, how do you make the senior pilot whole compared to the pilot that has 20+ years left?

sailingfun

A standard termination requires that the company purchase an annuity for the earned and accrued benefit or provide the equivalent amount of money in cash to the employee. Both those options maintain all of the employees earned and accrued benefits. The PBGC has a very favorable formula for calculating a lump sum. Fee if any plans are funded to that level. I lived a pension termination. I went over this stuff hundreds of times and attended several meetings with pension attornies. Delta could not even eliminate the lump sum provision in the pilot pension plan because it was a earned and accrued benefit. Doing that when the run on the bank started might have saved the plan. In the end it took a judge in a bankruptcy court to terminate the plan despite being only 20% funded and being frozen prior.
PBGC:Pension Plan termination
In a standard termination, an employer may end a plan only if there is enough money to pay all pension benefits accrued by workers as of the termination date. The plan administrator will pay the promised benefits by purchasing annuities from a private insurance company or making lump-sum payments to participants. Once a plan ends in a standard termination, PBGC's insurance responsibility ends.

Nordhavn

Sailing is a lived example of a company kicking labor squarely in the nut sack. This was a galvenizing event for their pilot group and he is a wealth of knowledge for us. Thanks for stoping in Sailing and dropping these little gems for us to ponder.

FXLAX

It doesn't sound to me that it would be a termination? It sounded more like a negotiation to convert into a lump sum. But maybe its just semantics? I wasn't making a value judgement on the idea. Just pointing out to the two other posters I quoted that maybe a lump sum contribution can be done within IRS rules (at least into an MBCBP), evidenced by our previous NC trying to negotiate that?

In any case, like I said, it was from the PREVIOUS negotiating committee. Reference their update from 3/19/24, where it says, "introducing a new concept to convert the current accrued benefit in the Pension plan as a pre-funded lump sum balance in the MBCBP."

Pilotguy21

No, I'm Saying the price the company will have to pay to get out of the pension is 150K per pilot per YOS. I don't care what the accrued value is.

Pilotguy21

standard termination also encompasses moving from DB to DC plan

Pilotguy21

I'm not so much advocating for the exact numbers in here as much as I'm advocating for us to eventually all be on 1 plan that elimates allllll the drama the pension creates. I want unity and I want to never negotiate the retirement section ever again. Delta will never have to and they will crush QOL and pay scales and scope every cycle because of it.

EMBFlyer

Until they don't...

JustInFacts

Thanks for the reference. The difference is they were trying to move money from one DB plan to another DB plan. That is not the same as what the OP was posting.

JustInFacts

In your original post you stated that the funding would come from the pension. So what would the accrued benefit be? The pension can only pay out the accrued benefit.

How did you come up with your $10.5 billion number? What's the difference in the accrued benefit and your required funding?

We are currently all on the same plan!

The drama comes from people who want to give up the pension.

So DALPA will never open section 28 again. Ok... I bet they thought the same thing when they had a 16% DC plan with COC. Now, some have COC, and all new hires get a MBCBP.