LongTimer V Posted September 30, 2003 Share Posted September 30, 2003 Why did my union fail to inform me that even tho we signed a contract,pensions were not part of the deal.Did i miss something here. Link to comment Share on other sites More sharing options...
dozerboy Posted September 30, 2003 Share Posted September 30, 2003 YOu mean that they didn't call you personally?...the nerve!!! Link to comment Share on other sites More sharing options...
LongTimer V Posted September 30, 2003 Author Share Posted September 30, 2003 http://www.thestar.com/NASApp/cs/ContentServer?pagename=thestar/Layout/Article_Type1&c=Article&cid=1064873412052&call_pageid=968350072197&col=969048863851 Link to comment Share on other sites More sharing options...
Guest CDB Posted September 30, 2003 Share Posted September 30, 2003 That's why I posted a link to the news story below as well. I found it interesting that the airline seems to be opening up the possibility for more employee concessions (in terms of pensions), after the original concessions were already signed. CDB Link to comment Share on other sites More sharing options...
Guest Sam of Old Posted September 30, 2003 Share Posted September 30, 2003 Pensions could only be touched as a last drastic step, or unless the employee group volunteered to accept changes, IMO. Canadian Law protects pensions and messing with that would open a whole can of worms for all the multitude of underfunded pension plans in the country. Modifying pension benefits would not only be ground-breaking but earth-shattering for the government and this country's pension system. The negative fallout, legally and politically, would be unacceptable; folding the company would be a more attractive option to those outside the walls. Link to comment Share on other sites More sharing options...
tsgas Posted September 30, 2003 Share Posted September 30, 2003 "You can't squeeze blood from a rock". AC does not have the funds so more wage cuts from the CAW might not be that far fetched. AC is emerged in a "Battle Royale" with the LCC and full pay to last day won't be the way to save the company. Link to comment Share on other sites More sharing options...
Guest Starman Posted September 30, 2003 Share Posted September 30, 2003 Does anyone happen to know how much money AC management has put aside for a "director's liability fund"? It's amazing how they've managed to find money for some things while underfunding the pensions by $1.5 billion... I also wonder how many Air Canada shares are owned by the $7.5 billion in pension assets? Are the owners being screwed by their own board? Link to comment Share on other sites More sharing options...
GTFA Posted September 30, 2003 Share Posted September 30, 2003 Ladies and Gentlemen, With all due respect, please try and comprehend that AC will not be financed by private money for the sole purpose of mainatining the pensions. If the conditions are not attractive enough to an outside investor, he will leave. It's not about what was agreed to in the past, it's about what it will take to get this company back on it's feet again! Prepare to negotiate everything. For a union rep to say that he would rather see AC go down rather than compromise any further is not helping. If he had said something more constructive like he will leave no rock unturned to improve the value of AC, he could have spun it to be a threat to management to take a closer look at their own sacred cows! GTFA Link to comment Share on other sites More sharing options...
John S. Posted September 30, 2003 Share Posted September 30, 2003 Sam, you say "Pensions could only be touched as a last drastic step…". Perhaps not. In the linked article it said that the Air Canada pension plans are in a solvency deficit of $1.5 Billion. That means if Air Canada were to wind up the plans today, September 30, 2003, then it is short $1.5B to pay the pensions earned to date. Forget about your future earnings, forget about salary increases which increase pensions, forget about future pension credits and forget about top hat. The pension plan can not even pay the pensions earned to date. The plan sponsor - Air Canada - must take some action. It has to fix the solvency deficiency. They can either increase their own contributions, have the members increase their contributions, reduce pension benefits, or do a combination of some or all of these choices. As you so keenly point out - reducing benefits is not a pleasant option. All unions will fight this. And some unions have ruled out increasing members contributions. So it looks like the company is going to have to find some spare cash, about $1.5 B, to put into the plan. This is a huge amount of money. And it is due very soon. So I suspect that there is a lot more to this debate than the general public (that means us) really know. In the end, if you were doing the due diligence you might just threaten to walk away. Unless those benefits are reduced to the point that the fund is not in a deficit position. But that is why the retired group have obtained legal representations. They KNOW a fight is coming. Link to comment Share on other sites More sharing options...
Guest neo Posted September 30, 2003 Share Posted September 30, 2003 In the entire CCAA process, beginning last April and continuing to this day, the employees at Air Canada have collectively shown all the sophistication of a country hick walking into a used car salesman's office. Unless we start showing some moxie and more than a little wit, we'll be driving off wearing barrels. "OK, I'll just take this deal and get it approved by the manager." [Pause to drink that great used car lot coffee...] "Ooops, sorry, the manager says 'No way'. Did you really need those seats, anyway?" The employees made agreements with management and creditors, not with the people offering to put up the equity that will let Air Canada emerge from bankruptcy. And the individuals and organizations bidding to rescue Air Canada are consummate dealers. You think they're going to leave stones unturned in their acquisition? An ancient author describes one of your two prospective new bosses in this way: "...A monster not to be overcome and that may not be described, Cerberus who eats raw flesh, the brazen-voiced hound of Hades, fifty-headed, relentless and strong." Hesiod, Theogony 310 You made a deal with the creditors and management to keep the pensions intact. But the people willing to put up the money to keep Air Canada going were not at that table. You can expect them to have something to say about your pension. Oh yes. neo Link to comment Share on other sites More sharing options...
Guest neo Posted September 30, 2003 Share Posted September 30, 2003 In the entire CCAA process, beginning last April and continuing to this day, the employees at Air Canada have collectively shown all the sophistication of a country hick walking into a used car salesman's office. Unless we start showing some moxie and more than a little wit, we'll be driving off wearing barrels. "OK, I'll just take this deal and get it approved by the manager." [Pause to drink that great used car lot coffee...] "Ooops, sorry, the manager says 'No way'. Did you really need those seats, anyway?" The employees made agreements with management and creditors, not with the people offering to put up the equity that will let Air Canada emerge from bankruptcy. And the individuals and organizations bidding to rescue Air Canada are consummate dealers. You think they're going to leave stones unturned in their acquisition? An ancient author describes one of your two prospective new bosses in this way: "...A monster not to be overcome and that may not be described, Cerberus who eats raw flesh, the brazen-voiced hound of Hades, fifty-headed, relentless and strong." Hesiod, Theogony 310 You made a deal with the creditors and management to keep the pensions intact. But the people willing to put up the money to keep Air Canada going were not at that table. You can expect them to have something to say about your pension. Oh yes. neo Link to comment Share on other sites More sharing options...
Guest Sam of Old Posted September 30, 2003 Share Posted September 30, 2003 So why would the members do anything. The deficit is there and federal law says AC has to fund it, and they have given them five years. Do nothing and retirees may run out of pay checks, ie AC cannot meet the payroll, or AC may make money (???) and start toppping up the deficit. There is really nothing to lose. Link to comment Share on other sites More sharing options...
Guest ECB Posted September 30, 2003 Share Posted September 30, 2003 I think C3 basically killed themselves through a number of poorly thought out strategic errors. However, Tango made sure it stayed dead. How? By destroying the confidence of the financial community in C3's rescue plans. Think of it this way, the local store is in recievership and is looking for a loan from the bank. While the application is in, a "Future home of Walmart" sign goes up accross the street. Does the small store get the loan? Was Tango put on to put C3 under? I doubt it but only Robert and his buds know for sure. Link to comment Share on other sites More sharing options...
GTFA Posted September 30, 2003 Share Posted September 30, 2003 Well, Shirley, there must be something to lose. If AC were to be liquidated how much would be left over to support the existing pensions? Link to comment Share on other sites More sharing options...
John S. Posted October 1, 2003 Share Posted October 1, 2003 Good question. I wonder what Financial Guy thinks. I'm just guessing, but think you'd probably get about 80% of the promised pension benefit. But pilots would probably lose 100% of the Top hat benefit. Link to comment Share on other sites More sharing options...
GTFA Posted October 1, 2003 Share Posted October 1, 2003 "But pilots would probably lose 100% of the Top hat benefit." Probably? The way I see it is that Top Hat comes directly off payroll. If there is no payroll where will top Hat come from? Link to comment Share on other sites More sharing options...
Guest PortTack Posted October 1, 2003 Share Posted October 1, 2003 Do you have an opinion on how the Jazz pensions will do in this? Link to comment Share on other sites More sharing options...
Financial Guy Posted October 1, 2003 Share Posted October 1, 2003 I'd have to agree with you John. Although, I would guestimate that it would be closer to 70%-75%, based on the (estimated) $1.1B shortfall. The "Top Hat" would be nothing but a memory as it is paid out of company revenues, so if the company folds, no "Top Hat". The TH is a contractual agreement between ACPA and the company - (likely) not governed or enforced by the Pension Board(s). JMHO Link to comment Share on other sites More sharing options...
Guest FRO Posted October 1, 2003 Share Posted October 1, 2003 PortTack, the Jazz pensions are a direct contribution pension plan, we put in 5% of our wages into a sunlife RRSP eligible pension plan, the company matches this(although since the CCAA no company contribution has been made) After 2 years in the plan the employee has full entitlement to the companys portion, ie if you leave Jazz before 2 years of contributions, you take yours with you and the company keeps theirs.We have several investment options available to us in the Sunlife plan depending on your comfort level with investing, overseas, domestic, diversified etc. The company has no control over the plan except for deciding where their 5% contribution is invested in the Sunlife plan. The maint group is %5 matched, the Pilots group was i believe at 7% and i dont know what the FA group percentage was, if any of this info is not up to date or incorrect then im sure someone will post a correction. FRO Link to comment Share on other sites More sharing options...
Guest PortTack Posted October 1, 2003 Share Posted October 1, 2003 Thanks a lot. Do you know if there is any risk to the company portion? Are we under funded? Link to comment Share on other sites More sharing options...
Guest FRO Posted October 1, 2003 Share Posted October 1, 2003 Well nothing is impossible nowadays, the company has said they would replace the missing contributions once the CCAA has ended, but dont hold your breath on that one though. If the funds are replaced then it will be a bonus. As for the companys portion as i understand it, it is locked in and cannot be touched by anyone as is our contribution, this includes creditors looking for funds during a bankruptcy (this from personal experience) FRO Link to comment Share on other sites More sharing options...
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