Salaried retirees keep up the fight over pensions

The group is preparing a suit against the Pension Benefit Guaranty Corp.

By Don Shilling

Delphi Corp. salaried retirees are continuing to fight for pension and health-care benefits awarded to hourly retirees.

The Delphi Salaried Retirees Association is preparing a lawsuit that seeks to lessen the pension cuts that are coming and is pushing for action in Congress that would provide a better health-care plan for retirees.

In the meantime, they are welcoming the help of Jim Traficant. The former congressman is providing three of his paintings to the retirees, which will be sold to raise money.

“Jim is a community member,” said Bruce Gump of Howland, head of the retirees’ legislative committee. “He’s a boisterous guy, and he sees a wrong happening. We’d be happy to accept his donation.”

Giving up is not an option for the retirees, said Chuck Cunningham of Howland, a retired senior executive at Delphi Packard Electric in Warren who has been working on a lawsuit against the federal Pension Benefit Guaranty Corp.

“This is a matter of financial life and death for many of our retirees,” he said.

Retirees are expecting their pensions to be cut between 30 percent and 70 percent now that the PBGC has taken over their plan.

New benefit amounts are expected in about six months after a review is conducted by the PBGC.

Cuts are coming because the PBGC limits benefit amounts and doesn’t pay supplements that were supposed to be paid until retirees reached 62 and were eligible for Social Security benefits.

Hourly retirees are in a much better situation. General Motors, Delphi’s former parent, has agreed to pay pension benefits that aren’t covered by the PBGC and is offering a health-care plan that the hourly retirees can join. Delphi canceled health-care benefits for both hourly and salaried retirees.

The salaried retirees are hoping a lawsuit against the PBGC will restore their pension benefits.

Cunningham said it will be filed soon in federal court in Michigan. He said the judge in Delphi’s bankruptcy case approved the filing of the lawsuit last week.

He said the lawsuit will take issue with how the PBGC gave up its liens on Delphi assets when it agreed to take over the company’s underfunded pension plans.

Action also is pending in Washington.

U.S. Rep. Tim Ryan of Niles, D-17th, introduced legislation last month that would create a trust fund with money that has been repaid by banks who have borrowed money from the government. The money would be used to pay for health insurance for the retirees.

Gump said he’s expecting hearings now that Congress has returned from summer recess. Also, U.S. Sen. Sherrod Brown, a Democrat from Avon, told the retirees last week that he would introduce companion legislation in the Senate.

Cunningham said, however, that he would prefer that efforts be focused on restoring pensions because retirees already have access to health care.

During the bankruptcy proceedings, the salaried retirees negotiated for money to be set aside for a health-care plan. Sign-ups began Sept. 1.

Cunningham said several plans are offered, but a husband and wife would pay $1,600 a month for benefits comparable to what Delphi offered. The least-expensive plan for an individual is $400 a month.

Cunningham added, however, retirees are eligible for a tax credit on the money they spend on premiums. They can claim a credit worth 80 percent of the amount paid initially, but that will decline to 65 percent next year, he said.

Tax credits allow a person to reduce the amount of taxes that are owed.

shilling@vindy.com