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Results of DALRC Meeting Oct28,2005
Subject: Delta Information
Date: Thu, 3 Nov 2005 03:42:08 +0000
DALRC Meeting - impressions from Pat Hamilton
I was at this meeting and I think it went better than the media portray.
Naturally the Delta execs could not say much because it is in litigation. There
was a Delta attorney who spoke and listened very carefully to all the other
Delta speakers to make sure they didn't say anything that could come back to
bite him/her or the company.
The really good part of the meeting was after the Delta execs and attorney left,
the DALRC and DP3 went into a private session with the three attorneys hired by
the DALRC. They told it like it is. They said what they know is going to
happen and also they told us some things that they think will happen and then
some other things that could happen.
One attorney spoke for them all - he had a tremendous sense of humor and made
things quite easy to understand. He started out by saying that he was not going
to bash the bankruptcy judge nor was he going to bash Delta. He said the
bankruptcy judge is a very smart woman and will make some of the hard decisions
that have to be made. One great thing in our favor was that she approved the
appointment of the 7 person panel from the DALRC to represent the non-union
retirees. All members of the DALRC will be asked to vote on the slate of people
being put up as members of the 7 person panel shortly.
He also went on to say that even though we are upset that promises made by the
company are now not being kept ... Delta made those promises in all good
consciousness - they didn't know how things were going to change so drastically.
The company has not "screwed" us on purpose - they just didn't know that fuel
was going to go up to a barrel, etc. He said that now that Delta is in
bankruptcy, they are no longer the master of their own fate. Other people and
the courts are now running the company - and none of these people, nor the
creditors care about retirees. I, personally, think his comments calmed things
down - I know they made me stop and think.
He then answered a lot of questions about the medical benefits. Our attorneys
think that we will probably start next year with the same offer as the active
employees - no enhanced and about a 4% increase in standard premium payments.
Also a 4th, more costly drug tier, and more in copayments on doctor's visits.
(Actually, DALRC is opposing Delta's changing retiree healthcare to mimic the
active employees and will attempt to negotiate a plan that is not as costly to
retirees, who are on fixed incomes.) He did mention, however, that Delta is
trying to get the bankruptcy judge to see section 1114 of the bankruptcy law
more in their favor, so they can substantially increase - or pass on the entire
premium payments - to the retirees. Our lawyers don't believe Delta is
interpreting this law appropriately and they are fighting against any changes.
The lawyers hired by the DALRC are strictly fighting for medical benefits. The
courts have appointed someone to represent us with respect to our pensions.
They are two separate things. Our attorney's did talk, however, about what
would happen if our pension was turned over to PBGC. As best as I can
understand it ... if you took early retirement from Delta, Delta has already
reduced your pension to compensate for the early retirement. If, when the
company turns the pensions over to PBGC you've been retired for at least 3
years, then you will become what is known as a member of the P3 category. (This
should say...if you are qualified for retirement for at least three years; that
is, whether you are active or retired, you must be at least 55 years old at time
of the plan termination.) This seems to be the category you want to be in.
Next, the PBGC sees how much money is in the fund when it's turned over. There
might be enough to pay everyone in the P3 category 100% of their retirement
benefits, or maybe only 90% of their retirement benefits - as long as these
benefits don't go over PBGC's cap.
What you get from the PBGC depends on what year Delta turns over the pensions -
if they do - how old you are when the pensions are turned over and how long
you've been retired. The PBGC shows 65 as full retirement age, however, Delta
has it at 62. The PBGC must go by what the company has, so for us, they will
show 62 as full retirement age.
The attorney said, it's not a slam dunk that Delta will turn over our pensions.
They said, obviously, UA has set a precedent. However, if the law is passed
that the airlines have 20 years to fully fund pension accounts, the PBGC may
tell Delta they can't turn it over now. He also said, there may be no benefit
to Delta turning it over now, since all payments into the fund - even for active
employees - have stopped.
Oh ... one more thing ... anyone retiring after this January will no longer have
any medical premiums paid for. They will have to fully fund their own medical
once retiring from Delta.
Hope this may help a little. When I talked to people upon leaving the session
(12noon to about 5:30p) most people seemed to feel better. Still scared because
there's much unknown, but feeling good about the attorneys representing us and
that the company has awakened to realize that the retirees are banning together
to be a stronger force.
I know the articles state between 1200 and 1700 people in attendance, but I
think, from looking around and doing a quick count of chairs that there were
more than that.
Pat Hamilton
Hamilton Consulting Group
pathamilton@peoplepc.com
Tel: 770-719-1807
Web: www.hamiltonconsulting |
