pilots fear pension cutback
Union agrees to deal slicing wages by 14%
By Harry R. Weber, Associated Press
The Arizona Republic
Friday, December 30, 2005
ATLANTA - The deep pay cuts pilots at bankrupt Delta Air
Lines have accepted may be the least of their worries: Their
retirement benefits are in jeopardy as well.
Union leaders say that in the lead-up to approving another
round of salary cuts on Wednesday, Delta's 6,000 pilots
expressed serious concerns that the nation's third-largest
carrier would next seek to terminate their pension plan.
The Air Line Pilots Association says the latest pay cut
agreement, while painful, will at least buy its leaders some
time to negotiate conditions that would be implemented if
the pension plan is nixed. advertisement
The union wants Delta to credit toward a comprehensive
concessions package the sides work out the amount the
airline has not paid to the pilots' pension plan since
filing for bankruptcy in New York on Sept. 14.
Pilots also are hoping to share in Delta's future profits
and new equity that will be issued when it emerges from
"They were trying to pocket the money they weren't
contributing to the defined benefit pension plan, and we
called their bluff on it," union spokesman John Culp said
Thursday, adding, "I believe this (agreement) has forced
their hand, and they're going to have to address it with
Culp said Delta missed $145 million in qualified pension
contributions on Oct. 15 and has been refusing to pay $7
million a month in non-qualified pension contributions.
"If they're going to stop supporting the plan, then
contractually they have to deal with us," Culp said.
Delta spokeswoman Chris Kelly said the airline is unsure
what will happen to the pension plan.
"We'll continue to work together with ALPA and Delta active
and retired employees to try to save Delta's pension plan,"
But, she added, "There are simply too many factors, some of
which are beyond the company's control, to be able to make
guarantees at this time."
Asked about the union's contention that it should be given
credit for the money the airline has saved thus far in
missed pension contributions, Kelly declined to comment.
Congress is still debating pension-reform legislation that
could help Delta spread out the payments of future
obligations to its pension plan. But even if that reform
comes it may not be enough.
The 14 percent cut in wages and other cuts equal to an
additional 1 percent wage reduction that pilots agreed to
Wednesday are on top of a 32.5 percent pay cut the pilots
agreed to last year as part of a $1 billion annual