IUE, GM reach deal on pensions pensions

GM has agreed to make payments to restore full pensions to hourly retirees of Delphi.

It appears that hourly retirees of Delphi Packard Electric will salvage all of their pensions as well as some of their health-care benefits.

Jim Clark, president of the International Union of Electrical Workers, said Tuesday the union reached a deal with General Motors and the U.S. Treasury for GM to pay the benefits.

The deal, however, does not cover salaried retirees, who also are losing benefits.

A big part of the deal is the payment of “top-up” amounts to cover all pension benefits that aren’t covered by a federal agency that is expected to take over Delphi pensions.

The health-care plan, however, would be more expensive than the current plan, which remains in effect to Dec. 31.

Still, the deal is good because it restores pensions, said Bob Sutton, an IUE staff representative who used to be a union official with IUE Local 717 in Warren.

“The pension benefits are great because at least our Delphi retirees can afford to pay for their health care, even though it means they will have to pay more for it,” he said.

The deal is not quite done yet, however.

Susan Garavaglia, a GM spokeswoman, said some final details need to be worked out so GM won’t comment on it until at least today.

The agreement also must be approved by a bankruptcy court judge.

The retirees have been outraged since July when Delphi said it was canceling health-care benefits and planning to turn over pensions to the federal Pension Benefit Guaranty Corp.

Delphi has been in bankruptcy court for four years.

Many retirees would have had pensions cut in half because the PBGC doesn’t pay supplements that Delphi provided to retirees until they were eligible for Social Security payments.

The IUE has been negotiating with GM because it used to be the parent company of Delphi. The Treasury Department also was involved because it provided funding for GM to emerge from its own bankruptcy.

The deal with GM calls for retirees who are under 65 to pay these monthly amounts for health-care coverage: $95 for a single retiree; $140 for a retiree and spouse; and $180 a month for a family plan.

The plan would carry a deductible of $2,500 for a single person or $5,000 for a family. After that amount is reached, the plan would cover 80 percent of expenses for network care or 60 percent for non-network care. Out-of-pocket maximums, however, would be $3,500 for a single person or $7,000 for a family.

Vision and dental coverage would be lost after Dec. 31.

Retirees now pay about $26 a month for coverage and have much lower deductibles.

Clark said the IUE understands the deductibles are high, but it was the best deal the union could get from GM and the Treasury.

Also, he noted that retirees can opt out of the health-care plan and receive a cash payment. The payment would vary on the age of the retiree and whether a spouse is involved.

Clark said final amounts haven’t been set, but he estimated that a younger retiree with a spouse would receive about $15,000. A 64-year-old retiree who is single would receive about $1,000, he said.

As for retirees who are 65 and eligible for Medicare, the union would receive a $1 billion claim in the bankruptcy case of the “old GM.” It isn’t known how much money the union would receive from that claim, but that amount would be used to fund some health-care benefit, such as prescription drug coverage, Clark said.

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