For the duration of this never-ending campaign, AFA has tried to turn the issue of the Delta Social Security Offset into some sort of scary demon, rather than telling us the truth. Meanwhile the AFA spin machine has been churning out hollow catchphrases and ridiculous music videos to try to distract us from the reality that they have been unwilling, unable or concerned about providing us with any sort of factual analysis so that we can make an informed decision in this election.
Keep in mind that if AFA were using our dues money to serve our best interests, they would have put together a comprehensive comparison long ago. Instead, they have spent millions on a campaign to try to extract $12 million dollars per year in dues from the Delta flight attendants.
AFA staffers, on the dues dole, have devoted all their time and energy (and our money) to change the rules of the game, disparage company leaders and shout down and shut out any democratic free thinkers. Last fiscal year alone, AFA paid $514,877.00 to Tricom Associates Inc (media advisors) to produce the campy “Our Song” music video, among others, and to advise the NWA MEC to avoid running this campaign on their own dismal record. In comparison, AFA spent ZERO dollars for media consulting when we were negotiating our last contract. Follow the money and you will realize that AFA is in it only for themselves.
But despite AFA’s best efforts to keep us uninformed and distracted with vague prose and snide MEC hotlines, the truth will come out. It always does. And know we can lay another AFA fear tactic to rest, with a complete, accurate, objective side by side comparison of the PMNW and PMDL defined benefit retirement plans.
You can view the complete details, including the actual numbers and an actuarial analysis here:
Facts - PMDL and PMNW FA Frozen Pension Benefit Comparisons
http://www.keepandshare.com/doc/2249155/frozen-pension-benefit-comparisons-pdf-september-17-2010-6-55-pm-34k?da=y
Actuarial Analysis - why the Social Security Offset feature cannot be removed from Delta's Retirement Plan and evidence that the DL Plan produces better benefits than the Northwest plan in the majority of cases
http://www.keepandshare.com/doc/2249154/towers-watson-analysis-pdf-september-17-2010-6-55-pm-69k?da=y
You can also view all documents on DeltaNet. DECISION 2010
What is the AFA not telling you about the Social Security Offset?
In several communications, the AFA has raised the issue of the Social Security Offset feature of the frozen Delta defined benefit pension plan. But they don’t ever really say much about it. Here are some facts you should know:
• The AFA cannot “get rid of” the Social Security Offset feature of the frozen DL plan if they are elected to represent the combined group. To do so would essentially triple Delta’s pension funding obligation over the next three years from $2B to $5-$6B and we can’t afford that no matter what the result of a vote.
• At the same time, Delta cannot impose a social security offset on the frozen NW plan. Doing this would violate Internal Revenue Code rules which prohibit a reduction in accrued benefits.
• What really matters is how much you take home from your pension plan – not how you accrue the benefit.
• On this score, Delta’s frozen DB plan beats the pre-merger Northwest DB plan the majority of the time.
• Working with an independent actuary, we compared the value of the frozen pension benefits that all 9,900 PMDL FAs would receive under both the PMDL and PMNW defined benefit formulas.
• Here is what we found:
o The majority of FAs do better under the Delta plan than they do under the Northwest plan – even after taking the Social Security offset into account.
o 8 out of 10 FAs do better (by an average of 37%) under the Delta plan if they retire at age 55 and start drawing Social Security at 62. [As we’ve said all along, the Delta plan and its Social Security offset formula was designed to help people who want to retire early.]
o 6 out of 10 FAs do better (by an average of 25%) under the Delta plan if they retire at age 62 and start drawing Social Security right away
• Who does better under the Northwest formula? They fall into a few categories:
o Those who fly very low hours or were at entry steps on the pay scale when the plans froze do better because the formula under the PMNW plan ignores how much pay you actually earn – everybody who worked a minimum number of hours got the same pension benefit.
o Those with more than 30 years of service, since the Delta plan capped service at 30 years. There are less than 200 FAs who meet this criteria.
• Want to understand more about how these frozen plans compare? Look for the details on the IFS Decision 2010 Portal page, including:
o Examples of actual FAs and how their benefit compares under each formula
o Rob Kight’s DeltaTube discussion of Social Security Offset
o Letter from a certified actuarial firm to Delta discussing these issues
Pension information can be difficult to understand. We wanted to give you the facts on this issue for your consideration.
