Posted on 02/24/2009 12:28:43 PM PST by arichtaxpayer
NEW YORK (AP) — A bankruptcy judge says Delphi can stop paying for health care and insurance benefits for its retired salaried workers. U.S. Bankruptcy Judge Robert Drain on Tuesday provisionally approved the auto supplier's request to cut off the benefits effective April 1. But he says the 15,000 affected retirees can form a committee to investigate if they have the right to negotiate with the company. The committee will present its findings at a March 11 hearing. Troy, Mich.-based Delphi Corp. has been operating under Chapter 11 bankruptcy protection since 2005. It says it needs to cut off the benefits as part of its restructuring. But attorneys for the retirees say the company is obligated to negotiate with the retirees before it cuts off their benefits. More than 1,600 retirees sent letters to the judge begging him to deny Delphi's motion.
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Beware pension funds that are not separate from the corporation...the only good thing about having worked all those years for DEC.
While they’re in BK, they’re not required to negotiate with the retirees or the unions. They’re required to deal with the BK judge. That’s it.
motor city ping
Please explain....”pension funds that are not separate from the corporation”
Aw, jeez. That’s not good.
Man oh man I feel bad for those guys. Union or not, they kept their end of the bargin yet will get the shaft. A bad situation, and I pray all will be well.
Where's Nelson? Ha! Ha! ex-Union (UAW) members, not being helped by their union, have to organize to hire a lawyer to negotiate with their ex-employer. Bet they would have to ^pay^ the unions lawyer if they even offer one up! My sides are aching!
Really! I meant to put you in the list.
Not Union - these are the salaried employees.
DEC’s pension funds (now HP or whomever is the current iteration of DEC) are in a separate retirement fund entity. They have no financial ties to HP or any other public corporation. HP’s bankruptcy would not effect retirees’ pensions.
If I understand correctly, GM and subsidiaries negotiated retirement benefits intending to pay them out of future profits. That meant they created future liabilities without funding them. Union retirees are essentially sitting on a pile of bad debt that won't be repaid.
Yes....I was just wondering if there was some other vehicle that I wasn’t aware of....my husbands pension is with Vanguard in various funds...and NOT in his companies stock...so that should be the best scenario...although in these times....sheesh...
Nothing new, McDonnell-Douglas canceled medical just before selling to Boeing. I presume it made the price a lot sweeter. (No bankruptcy required, just do it)
That means $15,000 a year for insurance - more than just your sides would hurt!
Thanks for the correction. I stand.....
good one....next he will tell everyone to “endeavor to persevere”
That’s bad because if you’re not old enough to qualify for Medicare, and have a pre-existing condition...you won’t be finding private insurance, anywhere, at any cost, that will cover that condition.
SURE. NO problem. BUT we cannot allow the auto workers to get the same thing can we?!?!??!?!
I'm sorry.
I fear your eperience will be shared by the vast majority who worked in the domestic automotive sector.
I’m guessing (without knowing all the specifics of the pension plan) that this was strictly through the company and not subject to any sort of insurance over the accounts?
In any case, I can definitely sympathize with those affected by this ruling. Had this happened to my grandparents (who were VERY well taken care of by Caterpillar after my G-pa’s 40+ years with them), I don’t know how they would’ve survived really...
We got notice a few months back that the company my husband’s pension from his first job was through went bankrupt. Fortunately, the pension plan was insured by the government (kind of like FDIC from what I understand) - the only thing is that since my husband is only 39, and we don’t really trust the gov’t to be solvent in 25 or so years we will be electing to receive a lump sum payment - after taxes and penalties it will come to be something like 5K... That’s it, but I suppose it’s much better than nothing at all!
We lost a little “safety net” for our retirement (not like we were depending on that alone mind you), but seeing the way things are going currently with our economy it seems a safer bet to pay the penalties and control where our money goes today (i.e. using it for a downpayment on a home or some such thing) than wait and MAYBE see it when we’re 65+.
It’s a shame there wasn’t some provision in these people’s retirement/pension plans for this situation. One cannot expect an employer to exist forever - especially in this economy. However, there should be some way to compensate these former employees and not just hang them out to dry as seems to be happening... At least MORALLY these employers have a duty to these people even if legally they don’t.
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