Archive for Saturday, August 5, 2006

Delta seeks to cancel pilot pensions

August 5, 2006

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— Delta Air Lines Inc. filed a formal request with bankruptcy court late Friday to terminate its pilots' pension plan, as President Bush prepared to sign a bill aimed in part at helping the struggling carrier save its other employees' pensions.

If the court in New York approves Delta's request to cancel its pilots' pensions effective Sept. 2, the government's pension insurer would take over the plan and pay pilots a reduced benefit based on when they retire and other factors. A hearing on the request is set for Sept. 1.

As part of a $280 million concessions agreement with the company first reached in April, the 6,000 pilots have agreed not to oppose the pension termination request, though other groups may oppose it. Atlanta-based Delta notified the Pension Benefit Guaranty Corp. in June of its intent to seek termination of the plan.

The bankruptcy court request came just a day after the Senate approved a pension bill that provides special relief for Delta and Eagan, Minn.-based Northwest Airlines Corp., allowing them to have 17 years to fully fund their pension plans.

Delta, the nation's third-largest carrier, had lobbied hard for the bill, arguing it was essential to help it avoid terminating the pension covering its ground workers and flight attendants. Bush said Friday he planned to sign the bill into law soon.

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