(March 2012) I debated putting words on paper regarding the recent Chapter 11 filing by my airline. Bankruptcy has become so vogue that the flying public now yawns at the notion, knowing that very little will change from their perspective. Frequent flyer miles remain intact. Steerage class food remains inedible. Baggage mishandling remains an everyday occurrence.
Who among the nonairline readership of this magazine will really care that the livelihood of another overpaid and underworked pilot has been sacrificed? Although my colleagues at other airlines are empathetic, I am certain that they are also muttering under their breath that it was only a matter of time before we suffered the same indignities. So why discuss this issue within the context of the Jumpseat column?
The reason is simple: education. And not so much education for the GA public as for the wide-eyed kid that is seated right now in an aviation classroom with dreams of an airline career. I would never attempt to discourage that student, even at this dark moment.
Insight has been my goal for these writings over the past nine years. Unfortunately, such insight is not always wrapped with a pretty bow. Nor does the insight necessarily involve a flying experience. As much as I yearn for my industry to travel through a time warp back to the period depicted in the Pan Am TV series, reality has other plans. The Space Shuttle program has a better chance of being reinstated than the airlines have of returning to the days of my esteemed predecessor, Len Morgan.
Although our entire collective bargaining agreement is in jeopardy with a bankruptcy status, pilot pensions seem to garner the most attention. A lot is at stake. Specific laws apply that affect pension benefits.
Our current pension involves two separate funds — the A-fund and the B-fund. In simple terms, the A-fund is based on longevity. The longer a pilot is employed, the greater the monthly annuity upon retirement.
The B-fund, on the other hand, is dependent on a pilot’s income. Each month the company contributes a fixed percentage of a pilot’s paycheck to one large collective fund. Every pilot is entitled to a percentage of that fund in the form of units. A major portion of the fund is invested in equities. The fund’s value for any given month fluctuates with the stock market. The specific value given to a unit is similar to a stock price. For example, if one unit is given the value of $50 and a pilot has accumulated 1,000 units, the present value of his or her B-fund is $50,000. The greater the income, the greater the amount of accumulated units.