Change to the age 60 rule?

[A4sForever]

Potential Pension "Reform" Legislation introduced in U.S. Congress

.... (I always get nervous when politicians start throwing the word "reform" around) ....and this might eventually effect many of you .... even though it doesn't seem like it now ----I used to think I would never get old enough to worry about "retirement" issues --- ahhhhh, the foolishness of youth. If passed, the pending legislation could/will have prescedent-setting ripple effects beyond the airline industry.

Sens. Johnny Isakson (R-Ga.) and Jay Rockefeller (D-W.Va.) introduced S.861, The Employee Pension Preservation Act of 2005, on April 20. This legislation would allow an airline to amortize its unfunded defined-benefit pension liabilities over a period of 25 years if that airline agrees through collective bargaining to limit its pension liabilities by freezing its plan or committing to funding any new benefits in the year that they accrue. In addition, the Pension Benefit Guaranty Corporation's liability would be frozen as of the date the plan begins using this new approach. This pension funding reform is essential for ALPA members who still have defined-benefit pension plans (note: defined = so-called "traditional" pension plans, as opposed to, say, a "defined-contribution" 401-K type plan).


Sen. Daniel Akaka (D-Hawaii) introduced S.685, The Pilots Equitable Treatment Act, on March 17. This legislation would change the PBGC rules so that pilots who must stop flying at age 60 would not have their benefits actuarially reduced by the PBGC in a terminated plan. Under current law, pilots are penalized by receiving reduced benefits because they must retire at 60, instead of the PBGC's "normal" retirement age of 65. S.685 would eliminate this penalty by allowing pilots-at age 60-to receive benefit guarantees calculated as though they already had reached age 65. This legislation could potentially affect any pilot with a defined-benefit pension plan.

 

[A4sForever]

From the Irony of Ironies Department:


Supremes say: "Eh?? What's that, Sonny? I can't hear you" ... to pilots' Age 60 retirement challenge.

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May 2, 10:16 AM (ET)


WASHINGTON (AP) - The Supreme Court on Monday declined to hear a pilot group's challenge to a federal rule forcing them to retire at age 60.

Justices let stand a lower ruling in favor of the Federal Aviation Administration, which says the retirement rule for commercial pilots is necessary for safety. Officials have argued that pilots lose critical cognitive and motor skills as they age.

The regulation, which was adopted during the 1950s, automatically bars airline pilots from flying after they reach 60, regardless of their health. A group of 12 pilots called that discriminatory and said their competency and health should be considered when deciding their ability to fly.

The pilots' appeal was backed by low-fare carrier Southwest Airlines, which argued in a friend-of-the-court filing that FAA data shows older pilots are "as safe as, and in some cases safer than, their younger colleagues."

"The 1950s-era age 60 rule, coupled with the FAA's rigid implementation of it, arbitrarily deprives Southwest Airlines of some of its best pilots at the peak of their careers," the airline wrote.

Earlier this year, the Supreme Court expanded job protections for workers age 40 and over by allowing them to file age bias claims over hiring and salary policies that disproportionately hurt them even if employers never intended any harm.

But the 5-3 opinion also granted employers additional defenses to ultimately win at trial by citing reasonable explanations for their policies, such as safety. In doing so, justices reasoned that age can affect performance in some occupations. The case is Butler v. FAA, 04-1233.

(Oh, and the Irony??? Please note: the average age of the 9 Supreme Court justices, the hightest (sic) judicial body in the country, is ....(*drum roll*)..... 71.22 years of age. Folks, it's really not about age 60; it's all about politics and money ..... and it never changes.)
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[wink]

That isn't necessariliy a bad thing. Money influances people to do things more efficently and make accurate decisions so they might save more or make more of it. Politics, while often corrupted by power, is also motivate by it in a positive fashion. A Congressman wants to stay in power then he better please his voters. That may mean voting for a freeway to nowwhere in his district or it might mean voting for Age 60 legislation to benefit his constituents. Lets face it. Every grey haired airline pilot that fights for a change to age 60 is motivated by dollars, pure and simple, money in his pocket. They don't care a wit about the principles. If not, the would be on the golf course enjoying their retirement in proper fashion. Southwest Airlines is motivated by money to support a change because it will reduce their training costs. The FAA, on the other hand, while certaininly not immune to money or power influances, does indeed have to justify any decision they make on safety. I dare say, there are many people at the FAA that do put safety first. If the FAA makes a decision that compromises safety, either congress or the public will jump on them. Just imagine the first accident attributed to a 65 year old pilot. 20/20, the NYT Magazine, Primetime, will be all over the FAA. SWA and the grey haired pilots will still have their savings or additional income. But the decision makers and policy writers gained nothing in making the change and stand to answer for the downside. This is one issue where money is the prime motivator for those that want change and they are insulated from the downside. That is a pretty easy position to take.

 

[A4sForever]

That isn't necessariliy a bad thing. ..........This is one issue where money is the prime motivator for those that want change and they are insulated from the downside. That is a pretty easy position to take.

I think I agree with most of what you said, Wink. I participated in the recently completed ALPA survey as you probably did also, but I don't have a "hard" position on this one. Personally, I am ready to retire, as in "yesterday" .... BUT I don't think it is right to prohibit another from flying past age 60 if his personal situation or desire dictates it. It's his/her business ... not the government's, and certainly not mine. Obviously, all the dots have to be connected on health and proficiency, but that is a given -- no questions there.

C.R. SMITH ........and ...... LGEN ELWOOD "PETE" QUESADA

The original age 60 was arbitrary --- certainly not based on any studies of aging or flight proficiency. It appears to have been based on nothing more than a desire to placate American Airlines chief executive and industry powerhouse C.R. Smith, whose in-house "study" showed age 60 was the desired upper age limit (read: $$$). He wanted to aggresively expand AA's projected new jet fleet and did not want to spend the "senior $$$" that would be required to train the "senior pilots" who would bid the new seats. When President Eisenhower appointed LTGEN Quesada to head the new FAA, Quesada came down with the original age 60 rule --- which dovetailed with C.R. Smith's desires.

While no direct evidence suggests any impropriety in the connection between C.R. Smith and Elwood Quesada, those opposed to the Age 60 rule remain suspicious of the relationship. They note that a year after the rule went into effect, and shortly after Quesada retired from his post as Administrator of the FAA, he was elected to a seat on the American Airlines’ Board of Directors.

It's ALWAYS about politics and money and the stakes are always high .....

 

[A4sForever]

ALPA recently completed a survey of its membership regarding proposed and possible changes to the age 60 rule. The Wilson Polling Center reported the following:
The polling was conducted in conjunction with the Wilson Center for Public Research who helped to develop the survey questions and analyze the results.

The Age 60 web survey opened on April 4, 2005 and was available online through April 29, 2005. All U.S. and Canadian members in good standing were eligible to participate in the survey.

Overall, nearly 38% of eligible members participated in the web survey. In addition to the web survey, traditional telephone polling augmented the web survey to ensure an accurate demographic representation of the membership.

Taken together, the telephone poll data and the two sets of demographically stratified web survey data provide extremely accurate results, with a raw sample margin of error of less than 1% and less than 0.5% with sample stratification.

The results from all data sets were very similar. In response to the question, "Do you favor changing the FAA Age 60 Rule," in the phone poll, 39% said yes to a change, 54% answered no to changing the rule.

For the largest demographically stratified cross-section of 6,559 records from the web survey, 42% said yes to a change, and 56% said no to changing the rule.

For the second cross-section of 1,045 stratified and coded responses, 41% said yes and 56% said no. And for the entire unadjusted set of 19,012 web responses 44% said yes and 55% said no.

This is important to all of you who are on the "outside looking in" .... if the guys who are currently in the seats don't get out of them @ age 60 --- you can't get in UNTIL they vacate. See how it works .... ????