Pension
Q&A
July 12, 2007
National Pension Plan Update
As previously reported by District 143, we continue to develop proper communications for the National Pension Plan. Over the past few weeks District 143 has received emails pertaining to our new pension plan for the ESSC & COFPS collective bargaining agreements; ultimately they are questions related the plan in itself.
District 143 continues to work with representatives from the National Pension Plan, as well as the Grand Lodge, to establish communications related to these various questions. Additionally, all parties involved continue to coordinate available dates so that we can establish applicable “town hall” meetings at station locations.
In the interim, District 143 has decided to put together a brief “Frequently Asked Questions” from some of the emails that District 143 has received. This piece of communication is merely a small update for our membership. The week of July 23, 2007 District 143 will meet and confer with the National Pension Plan representatives, and the Grand Lodge to finalize future communications. Below are a few of the most “Frequently Asked Questions”:
Q. What is the I.A.M. National Pension Plan?
A. It is a multiemployer, Taft-Hartley Defined Benefit Plan.
Q. How well funded is the National Pension Plan?
A. The Plan has $6.8 billion in assets and more importantly, the Plan has been well-funded for 45 years.
Q. What makes the National Pension Plan unique from employer-sponsored plans?
A. When the Plan has excess money, the Board of Trustees adopts benefit increases and Plan improvements that make qualifying for benefits easier.
Q. Will my years in the Northwest Airlines pension plan be counted in the National Pension Plan?
A. The employees’ years of vesting service under the Company’s defined benefit plan and 401(k) Plan will be recognized as vesting service in the National Pension Plan for eligibility for vesting and unreduced early retirement pensions at age 62 with 20 years of service and at any age with 30 years of service.
Q. Who do I contact if I have questions on the National Pension Plan?
A. Contact the National Pension Plan directly at 1-800-424-9608.
IAM members are the only Northwest Airlines employees who still earn pension benefits in a federally-guaranteed, secure pension plan. You join IAM members at US Airways, United Airlines and Aloha Airlines who have the distinction of being the only workers at those carriers who still have a defined benefit pension. All other NWA employees must rely solely on their ability to successfully invest their 401(k) plan to continue earning a retirement benefit and hope they don’t out live their savings. IAM members may still contribute to their 401(k) plan, but have the peace of mind that comes with knowing their IAM National Pension Plan benefit will be paid upon retirement for the rest of their lives.
Initial NPP Benefits (which could increase in subsequent contract negotiations):
IAM Job Classification |
Pension Benefit |
ESE, Lead ESE, Stock Clerk, Lead Stock Clerk, CSA, RSA, Clerical Level D, Operations Clerk, Commercial Agent and Print Shop Tech II |
$36.94 per month X each year of future credited service under plan |
Clerical Levels A,B, C, Skycap, Print Shop Tech, Print Shop Tech I, World Club Rep./Supervisor and QSA |
$30.51 per month X each year of future credited service under plan |
Clerical Level E, Aircraft Routing Controller, Agent Supervisor, Senior Control Agent, Super-Cargo and Print Shop Tech III |
$39.93 per month X each year of future credited service under plan |
Upon retirement, members who have already earned a vested benefit in the Northwest Airlines Pension Plan for Contract Employees and earn a vested benefit in the IAM National Pension Plan will receive two checks, one from NWA and one from the NPP, each month.
For more than four decades, the NPP has provided generous benefits for its participants while remaining consistently well-funded. Some details about your new pension:
- Nearly $8 billion in assets
- Over 1,700 contributing employers
- Over 71,000 retirees and beneficiaries
- 90,000 active participating members
The National Pension Plan has features not available in the frozen NWA plan, including …
- Your vesting service in the NWA retirement plan is counted towards the 5-year vesting requirement of the National Pension Plan for normal retirement benefits, payable at age 65 as well as towards vesting requirements for enhanced early retirement benefits.
- An unreduced retirement benefit available at any age after 30 years of service
- An unreduced pension benefit at age 62, with 20 years of service
IAM members will be receiving information directly from the NPP, and additional plan facts are available at www.iamnpf.org.
All NWA employees were affected by the airline’s decision to freeze their pension plans. Only the IAM was able to negotiate a new replacement defined benefit pension plan for its members, providing a strong foundation on which to build your retirement security. This achievement was made possible because of the membership’s solidarity and the difficult decisions you made while the airline was in bankruptcy. Surviving bankruptcy with a guaranteed pension is a unique benefit of IAM membership; one other airline employees wish they had.
IAM Members Start Earning Pension Benefits
On Tuesday, July 3, 2007 District 143 Representatives met with NWA representatives to formally sign off on the Standard Contract Language for the new pension plans for the ESSC & COFPS contracts, which took effect on June 1, 2007. We are in the process of completing a “Most Frequently Asked Questions” regarding the new plan for publication to the membership.
Additionally, we continue to work with the International and the National Pension Plan representatives to establish dates to conduct “town hall” meetings at various locations so that the membership may attend for clarification to any outstanding questions. Once dates have been established and agreed upon by all applicable parties, District 143 will announce the schedule.
IAM National Pension Plan
In accordance with IAM collective bargaining agreements, Northwest Airlines on June 1, 2007 will begin participation in our negotiated IAM National Pension Plan. For an update as to where the process is at, District 143 is pleased to report to the membership that we continue to work diligently towards final completion of all documents for membership communication.
A year ago we lobbied Capitol Hill and across the bargaining table to save our pensions. Against all odds, the IAM and Northwest Airlines reached an agreement that would preserve our old pension plan versus having them eliminated; additionally, our membership ultimately ratified an agreement that would protect a defined pension plan by entering into the National Pension Plan.
District 143 would like to advise the membership that much more detailed information will be available shortly. Information regarding the National Pension Plan, our monthly and hourly contributions, vesting information, contact information, and more will be forthcoming. As previously stated, National Pension Plan, the International, and District 143 continue to work on the final pieces of communications.
Once established, National Pension Plan representatives and District 143 representatives will begin “town hall meetings” and “road shows” to properly communicate the new pension. We appreciate your continued patience.