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Following are some questions and answers regarding retirement benefits after ADPX pilots join AMPA
No, your enhanced 401k is the same in AMPA as it was as a non-union employee.
No, you will not lose your pension. All single employer pensions are federally guaranteed by the PBGC (www.pbgc.gov). Single employer pension plans that fail in 2011 are 100% guaranteed at age 65 to a maximum benefit of $4,500 a month.
Employees decide if they are represented by a labor union. Employees work together to gain support to form and join a union. When enough support is shown, employees form a union.
Historically, non-union employees who come into a SPEEA bargaining unit during the past decade received a higher pension benefit. This is due to the high SPEEA salary pools and low interest rates.
If ADPX pilots come into the AMPA contract and have the same pension as the other SPEEA-represented Boeing employees in the AMPA contract, then it is unlikely their pension will be reduced for the following reasons:
PVP Heritage Benefit
If you were in a non-union position on 12/31/1998, then your company service was converted to a monthly benefit and frozen. This benefit is indexed 1:1 to your annual base salary at retirement and as your base salary continues to grow, the benefit continues to grow. For most non-union individuals, the PVP heritage benefit contains the majority of their PVP benefit. If your salary grows faster as a result of forming or joining a union, then the heritage benefit component of your PVP pension also grows faster. This means that if you join a union, and your salary grows faster because you joined a union, your non-union pension pays more than it would otherwise.
SPEEA can't guarantee that your base salary will increase as a result of forming or joining a union. However, as a union member you will help determine negotiation priorities and elect the employees who serve as your negotiating team.
PVP Credit Based
The credit based formula (for all non-union service on and after 1/1/1999) continues to accrue interest based on the exact same formula as other non-union employees even if you leave the ranks of the non-union and were to form or join a union at Boeing.
Company Service
If you were to form or join a union, the major difference is that new company service is credited towards the BCERP pension plan instead of the PVP. The calculations are different, based on different conditions and have different strengths. SPEEA has performed an analysis covering the past 30 years and if both pensions were in place for 30 years and compared side by side, the BCERP benefit resulted in a higher benefit for all salary ranges for all individuals under age 70. The analysis included the high interest rates of the 80's and assumed a flat 4% salary growth.
If you work past age 70, and interest rates rise to and remain at double digit levels, then it is possible for new company service in the PVP to be worth more than new company service in BCERP. If interest rates remain near their historical average or near their current low levels and/or if you retire before age 70, then the new company service into BCERP will likely be worth more than new company service into the PVP.
If you would like a presentation of the SPEEA analysis, or if you wish to discuss your specific situation please contact Matt Kempf at mattk@speea.org.
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