California State Assembly Strongly Supports Federal Legislation to Restore Flight Attendant Pensions
August 19, 2005
Sacramento, CA - The California State Assembly passed a resolution yesterday with a 44 to 22 vote in favor of Resolution No. 18 which calls for federal legislation that would aid in the protection of hard-earned retirement benefits for all non-executive and non-management employees in the airline industry. Flight attendants, represented by the Association of Flight Attendant-CWA, AFL-CIO (AFA), are seeking federal legislation to overturn the bankruptcy court approval of a $1.5 billion backroom deal between United Airlines and the Pension Benefit Guaranty Corporation (PBGC) to terminate employee pension plans.
"The California State Assembly has registered its disapproval that United CEO Glenn Tilton would protect his $4.5 million pension trust while using the agency that is meant to be the protector of our nation's pension plans to destroy the retirement security of United Airlines flight attendants," stated Greg Davidowitch, president of AFA at United Airlines. "This management dealt a crippling blow to the retirement security of millions of Americans through its deal with the PBGC and the California legislature recognizes it is crucial that our federal representatives act quickly to right this horrific wrong."
"I thank and applaud my colleagues who stood up for America's workforce in passing California House Resolution 18," stated Assembly Member Gene Mullin, who introduced the resolution.
United Airlines employed the prominent California lobbying firm, GCG Rose & Kindel to work against passage of the State Assembly resolution. Quarterly payments to the lobbying firm quadrupled during the time that it worked against passage of the resolution. A similar resolution was unanimously passed in the California State Senate on June 23, 2005.
"This resolution demonstrates that no matter how much misinformation or political arm-twisting United CEO Glenn Tilton exercises to deny flight attendants the pensions they have earned and sacrificed to preserve, the truth and public support is on our side," Davidowitch continued. "Holding this management accountable for their actions against our airline and its frontline workers is an arduous process. But, it's a fight that we will heartily endure at least one day more than them because justice and the very foundation of our nation's values are on our side."
"To help my airline during this bankruptcy I have sacrificed my pay, I work longer days more often, I pay more for my medical - and after giving 16 years of my life to United Airlines, this management stole my pension," said Carol Ong, a United Flight Attendant for over 16 years. "The California State Assembly resolution echoes wide-spread public concern for the grave injustice done to me and my colleagues. No one should end up with little or no retirement."
75 Years of Safety & Service: 60 Years of Unity
This year marks the 75th anniversary of the flight attendant profession and the 60th anniversary of the Association of Flight Attendants. More than 46,000 flight attendants, including the 20,000 at United, join together to form AFA-CWA, the world's largest flight attendant union. AFA is part of the 700,000-member strong Communications Workers of America, AFL-CIO. Visit us at www.unitedafa.org.
Text of California State Assembly Resolution No. 18
WHEREAS, United Airlines has used the bankruptcy court to default on its pension obligations, leaving thousands of United Airlines employees and retirees to face retirement with dramatically reduced pensions they worked decades to earn; and
WHEREAS, It appears that by placing their pensions in a trust outside the scope of the bankruptcy proceedings, only certain executives at United Airlines had their pensions protected; and
WHEREAS, United Airlines executives have yet to fulfill their promise to return $100 million a year in concessions to help the airline, but have nevertheless proceeded to make new and deeper cuts to their employees' financial security; and
WHEREAS, As part of the bankruptcy proceedings, United Airlines will undergo restructuring based in large part upon wage and benefits concessions from the line workers of United Airlines; and
WHEREAS, In the fall of 2004, when plans by United Airlines to dissolve its employees' pensions became clear, Representative George Miller, Representative Janice Schakowsky, and Senator Edward Kennedy were joined by 113 other Congressional Representatives and 22 Senators in urging the airline not to terminate the employees' retirement security; and
WHEREAS, While United Airlines was negotiating with employee representatives regarding wage and benefits packages, it was simultaneously brokering an arrangement with the Pension Benefit Guaranty Corporation (PBGC) that would result in the termination of all employee pension plans; and
WHEREAS, Despite a legislative request that it not seek to terminate its pension obligations, United Airlines continued to pursue such a termination through a request to the bankruptcy court to eliminate its pension obligations and have the PBGC, a government agency, assume the airline's pension obligations; and
WHEREAS, The PBGC was created by the Employee Retirement Income Security Act of 1974 to encourage the continuation and maintenance of voluntary private pension plans, provide timely and uninterrupted payment of pension benefits, and keep pension insurance premiums at a minimum; and
WHEREAS, Representatives Miller and Schakowsky sought leave to file an amicus brief with the bankruptcy court asking the judge to examine whether United Airlines's request to be relieved of its pension obligations was necessary in order to emerge from bankruptcy or whether the request was merely an attempt to evade its responsibilities under the collective bargaining agreement, but their motion was denied; and
WHEREAS, United Airlines's employees already have agreed to over $3 billion in cuts to wages and benefits to assist the airline in emerging from bankruptcy; and
WHEREAS, Federal legislation introduced by Representative Miller calls for a six-month moratorium during which companies currently in bankruptcy would be prohibited from shifting billion-dollar pension debts to the government, and this provision would be retroactive to encompass United Airlines employees; and
WHEREAS, This legislation would provide Congress with additional time to formulate a solution to this pension crisis and prevent it from worsening and devastating the lives of tens of thousands of American workers; and
WHEREAS, Federal legislation, also introduced by Representative Miller, would prohibit a company from making payments into the executive pension plan if the workers' pension plans are under-funded and would require companies that ask bankruptcy courts to erase their debt to rank-and-file pension plans to first reveal the status of their executive pension plans to ensure parity in how employees and executives are treated; now, therefore, be it
Resolved by the Assembly of the State of California, That the Assembly respectfully requests the President and Congress of the United States to declare their support for, and to enact, federal legislation that would aid in the protection of hard-earned retirement benefits for all non-executive and non-management employees in the airline industry; and be it further
Resolved, That the Chief Clerk of the Assembly transmit copies of this resolution to the author for appropriate distribution.