Delta Terminates Pilots' Pension Plan - Now We Get to Fund It
Delta Airlines recently obtained approval to terminate its pilots' pension plan as part of its bankruptcy restructuring plan. This essentially means that the plan will be turned over to the Pension Benefit Guaranty Corporation - a government entity that insures belly-up plans. The PBGC is funded by insurance proceeds paid for by those who have defined benefit pension plans. Unfortunately, however, the PBGS is largely underfunded. The result: you and I will likely get to fund the pilots' $75,000/year retirement income.
Delta argued that the plan poses an immediate $1 Billion liability that would prevent the company from emerging successfully from bankruptcy. The pilots' union has agreed to the termination. I suppose a job is better than a pension?