BILL KADEREIT

PRESIDENT'S FORUM

NRLN Advancing 4-Part Effort to Enact Retiree Income Protections 

As companies file for Chapter 11 bankruptcies and others are preparing to march into bankruptcy court, the National Retiree Legislative Network is the only organization attempting to gain comprehensive legislation and rule changes that protect retirees of companies who reorganize through bankruptcy.

Through research and the unfortunate experiences of our member retiree associations—Delta Air Lines Pilots, General Motors and Chrysler—whose members have experienced the throes of bankruptcy, the NRLN has funded and developed a suite of white papers on Pension Asset Protection, Bankruptcy Reform, PBGC Reform and Mergers & Acquisitions. These legislative proposals describe the harm done to retirees when a company declares bankruptcy and identify the statute changes that need to be made to place retirees' pensions and benefits on a list of obligations that companies can't shed through bankruptcy. We lobby the House and Senate and meet with the staff of the Pension Benefit Guaranty Corporation in an effort to gain these reforms.

Eastman Kodak retirees affiliated with the NRLN through EKRA are highly concerned that Kodak may file for Chapter 11 bankruptcy soon. There were news reports on January 13 that Eastman Kodak is in advanced talks with Citigroup Inc. to provide bankruptcy financing. The NRLN is working with EKRA leaders to set up meetings with New York Representatives and Senators to discuss Kodak retirees' concerns and present the NRLN's white papers on Bankruptcy Reform, PBGC Reform, Pension Asset Protection and Mergers, Acquisitions and Spin-offs. Since there is also a possibility that Kodak could merge with or be acquired by another company, or some of their businesses may be spun off, we are sharing with members of Congress and committee staff members our white paper on needed laws to protect retirees' pensions under these scenarios.

EKRA leaders have done an excellent job of communicating with their members as well as the local and national media to bring attention to the financial risks all Kodak retirees are facing. NRLN and retiree associations' leaders who have experience in these matters are standing with them in meetings in Washington, D.C. while attending the NRLN’s upcoming Annual Leadership Conference in an effort to protect EKRA members and all retirees in the future.

General Motors Retiree Association members are concerned about a January 11 news report that GM may launch a program to "buy out" the pensions of some of its retirees in an effort to reduce its unfunded pension plan liabilities. The article stated that GM's U. S. pension plans are underfunded by $12 billion (not including $2 billion in stock that GM put into its pension plans). Protection of pension assets is a crucial GM retiree issue.

The NRLN is engaged with GMRA leaders to assist in evaluating any offer that GM may make to salaried retirees on the "buy out" of their pensions. We want to guard against retirees unknowingly accepting a "buy out" offer that would be substantially less than 100% of the value of the pension that is owed to them. Retirees need to be aware of how to reach an informed decision on whether or not to accept a lump sum pension "buy out" offer. Both the GMRA and the NRLN are working in tandem to make sure that information is available to those offered the "buy-out" plan.

You may know that American Airlines has filed for Chapter 11 bankruptcy. The NRLN has reached out to American Airlines retiree clubs with an offer to help them form a retiree association. I have communicated that the NRLN can provide value to American Airlines retirees given the NRLN's experience with three retiree associations who have gone through bankruptcy and the NRLN's efforts to gain legislation and rule changes to protect retirees' pensions and benefits. We support the PBGC as it ratchets up pressure on the parent of American Airlines to preserve the pension plans of the airline's 130,000 workers and retirees.

Please read the NRLN's white papers on Pension Asset Protection, Bankruptcy Reform, PBGC Reform and Mergers & Acquisitions. Click here to reach the NRLN webpage where these and other white papers can be accessed. Or, you can click on the "Legislative Action" tab at the top of this and select "NRLN white papers" from the drop down menu.

Bill Kadereit, President
National Retiree Legislative Network