First Brands pension plans

[Olds394]

I like this news but others will not. Yes, I am collecting a pension, but most people could. If they wanted to.
https://content.govdelivery.com/accounts/USPBGC/bulletins/4153b3c

 

[paulri]

So taxpayers are paying for this? The first sentence in the article reads, "WASHINGTON — The Pension Benefit Guaranty Corporation (PBGC) announced that it is taking action to assume responsibility for three pension plans sponsored by affiliates of First Brands Group, LLC (First Brands)."

Olds, don't get me wrong. I like the fact that the retirees will be taken care of. Absolutely prefer that to having them sitting on a street corner with a sign. I'm a bit ticked off that companies can enjoy the profits in the good years, and then just walk away and leave the US taxpayer holding the bag later on.

 

[slacktide_bitog]

So taxpayers are paying for this? The first sentence in the article reads, "WASHINGTON — The Pension Benefit Guaranty Corporation (PBGC) announced that it is taking action to assume responsibility for three pension plans sponsored by affiliates of First Brands Group, LLC (First Brands)."

Olds, don't get me wrong. I like the fact that the retirees will be taken care of. Absolutely prefer that to having them sitting on a street corner with a sign. I'm a bit ticked off that companies can enjoy the profits in the good years, and then just walk away and leave the US taxpayer holding the bag later on.

This.

The "executives" who stole from First Brands should have their ill-gotten gains seized and use that towards the pension fund.

 

[SC Maintenance]

Public Benefit Guarantee Corporation takes over all pensions for companies that fail. They safeguard the money in the pensions trust. This is why its important if you have a pension your employer fully funds it.

What people in the plan get depends entirely on how well funded it is. Most are not well funded at all, more like ponzi's so once no one is paying in its a problem.

If the pension is fully funded more than likely all employees will get a lump sum to invest however, so that the PBGC doesn't have to administer it.

There is a cap on how much you can get. $80K/year I think. So if someone was getting more than that then there pension will be cut. Everyone - including current retirees. Its all about how much money is in the fund. Taxpayers don't subsidize this. I suppose we do pay for the PBGC however, so we fund the administration - which should be OK with everyone.

This is 100% normal. They still administer pensions from other failed companies like United Airlines and Delphi Automotive, for example.

but most people could. If they wanted to.

This is fairly untrue I think. I started 30 years ago with a place that had historically had a pension stopped it for new employees. My wife has a small pension for being a teacher - they push new teachers into a 403B (public 401K equivalent with less options). Not everyone can work for the government, who would pay for the government?

 

[paulri]

OK, so this isn't funded by the taxpayers, but that simply means that the pensioners won't get what was promised to them. I'm not sure I like that any more. $80K is $2K per month for just over 3 full years.

Public Benefit Guarantee Corporation takes over all pensions for companies that fail. They safeguard the money in the pensions trust. This is why its important if you have a pension your employer fully funds it.

What people in the plan get depends entirely on how well funded it is. Most are not well funded at all, more like ponzi's so once no one is paying in its a problem.

If the pension is fully funded more than likely all employees will get a lump sum to invest however, so that the PBGC doesn't have to administer it.

There is a cap on how much you can get. $80K I think. So if someone was getting more than that then there pension will be cut. Everyone - including current retirees. Its all about how much money is in the fund. Taxpayers don't subsidize this.

This is 100% normal. They still administer pensions from other failed companies like United Airlines and Delphi Automotive, for example.


This is fairly untrue I think. I started 30 years ago with a place that had historically had a pension stopped it for new employees. My wife has a small pension for being a teacher - they push new teachers into a 401K. Not everyone can work for the government, who would pay for the government?

 

[JTK]

OK, so this isn't funded by the taxpayers, but that simply means that the pensioners won't get what was promised to them. I'm not sure I like that any more. $80K is $2K per month for just over 3 full years.

I've spoken to some people who have "lost" their pensions, meaning it was turned over to the PBGC. Ultimately they got a small fraction of what they were "promised". No one makes out in this.

 

[SC Maintenance]

OK, so this isn't funded by the taxpayers, but that simply means that the pensioners won't get what was promised to them. I'm not sure I like that any more. $80K is $2K per month for just over 3 full years.

Sorry - $80K per year max. I have fixed my original post.

Its capped. If you were getting more than $80K a year you won't be even if its funded. I imagine it affected very few people.

No taxpayer money as far as I understand it (other than to run the government agency).

 

[SC Maintenance]

I've spoken to some people who have "lost" their pensions, meaning it was turned over to the PBGC. Ultimately they got a small fraction of what they were "promised". No one makes out in this.

I do also, but it wasn't the PBGC - it was an underfunded pension. Most are. Most rely on the fact that people will continue to pay in perpetually, so when that ends they run out.

They take whatever money is in the trust fund and figure out how to pay everyone. Everyone takes the same type of haircut, however that is calculated.

 

[JTK]

I do also, but it wasn't the PBGC - it was an underfunded pension. Most are. Most rely on the fact that people will continue to pay in perpetually, so when that ends they run out.

They take whatever money is in the trust fund and figure out how to pay everyone. Everyone takes the same type of haircut, however that is calculated.

Yessir, I get that. These companies had underfunded pensions among other financial woes.

 

[opus1]

I've spoken to some people who have "lost" their pensions, meaning it was turned over to the PBGC. Ultimately they got a small fraction of what they were "promised". No one makes out in this.

^This. When Dad retired he had the option to get 100% of what was due, and it ended when he died, or take 80% of what was due and Mom would get 50% after he died. Paraphrasing what he said at the time, he had 12 years on Mom so there was a pretty good chance he'd go long before she did, so he took the 80% option, expecting her to be taken care of after he left.

The company went bankrupt. PBGC took over and continued to pay Dad the 80% figure, but when he died, Mom got bupkis. Apparently they didn't have to live up to the entire agreement...I have several comments I'd like to make, but don't want to turn the thread political nor do I want it to be locked. But, yeah; the people that *should* be taken care of in these cases usually aren't.

 

[SC Maintenance]

^This. When Dad retired he had the option to get 100% of what was due, and it ended when he died, or take 80% of what was due and Mom would get 50% after he died. Paraphrasing what he said at the time, he had 12 years on Mom so there was a pretty good chance he'd go long before she did, so he took the 80% option, expecting her to be taken care of after he left.

The company went bankrupt. PBGC took over and continued to pay Dad the 80% figure, but when he died, Mom got bupkis. Apparently they didn't have to live up to the entire agreement...I have several comments I'd like to make, but don't want to turn the thread political nor do I want it to be locked. But, yeah; the people that *should* be taken care of in these cases usually aren't.

They should have paid survivor benefits if they had funds to do so. Possibly there is more to the story?

Does PBGC pay survivor benefits?​

Yes. PBGC will pay benefits to your surviving beneficiary if you elected a benefit form that provides survivor benefits, whether you retired before or after your plan terminated.

https://www.pbgc.gov/workers-retire...pay benefits to,or after your plan terminated.

 

[Dave Hess]

I've spoken to some people who have "lost" their pensions, meaning it was turned over to the PBGC. Ultimately they got a small fraction of what they were "promised". No one makes out in this.

That’s what happened when PanAm Ailrlines went bankrupt and PBGC.

My dad got a pension but it was 1/4 of what he should have gotten.

Luckily the pension was really not needed to live on during retirement.

 

[opus1]

They should have paid survivor benefits if they had funds to do so. Possibly there is more to the story?

Does PBGC pay survivor benefits?​

Yes. PBGC will pay benefits to your surviving beneficiary if you elected a benefit form that provides survivor benefits, whether you retired before or after your plan terminated.

https://www.pbgc.gov/workers-retirees/learn/understanding-your-pension-pbgc-coverage#:~:text=PBGC will pay benefits to,or after your plan terminated.

I would have to find the info, but the summary I can give off the top of my head is that it involved something called the "Rule of 5" and involved the PBGC taking over the plan, restoring it to the company and then having to take it over again. This tended to impact people with longer seniority, which included Dad.

The union wasn't much help. Come to think of it, they never sent flowers to Dad's funeral like they were supposed to...but I digress.

 

[repairman54]

PBGC pays 50% survivor benefits. I retired from Sears after 46 yrs and PBGC has my pension. There is no opt out of the survivor benefit, at least when I started collecting mine. 6 yrs. retired now, had to hang in to make it into my 66th year to get out before the Titanic sank.
I'm only getting half of what I was entitled / earned before the Kmart take over freeze then the PBGC takeover.
Something is better than nothing, let me stop here before a rant kicks in.

 

[Finklejag]

Welcome to the club. Part of my United Airlines pension is with the PBGC. The IAM started the new pension after bankruptcy and now that pension is underfunded. It’s was put in the red for 10 years, and just recently they added 15 more years to that, so 2045 until they see it fully funded. What that means is if you retire before 65, you get penalized 6% per year below 65. They’re all crooks, corporations and the unions!

United could’ve saved the pensions during bankruptcy if they sold off the Mileage Plus program, they buried that program from the bankruptcy court. Today, that program and credit card deals brings in billions to United yearly.

 

[crashz]

"Special financial assistance for financially troubled multiemployer plans is financed by general taxpayer monies." Last line of the About the PBGC. I'm conflicted about this. As stated, taxpayers should not pay. But I don't want a retiree to go hungry because depended on their pension.

Maybe a Corporation needs to have the officers or board personally responsible for the backing of debt. And pensions need to be legally written as debt owed when in default. Golden handshake should be the iron handcuff.

 

[paulri]

Something like this. If their golden handshakes & bonuses while still working, were tied to the viability of these pensions, I bet they'd be in a much stronger financial shape.

"Special financial assistance for financially troubled multiemployer plans is financed by general taxpayer monies." Last line of the About the PBGC. I'm conflicted about this. As stated, taxpayers should not pay. But I don't want a retiree to go hungry because depended on their pension.

Maybe a Corporation needs to have the officers or board personally responsible for the backing of debt. And pensions need to be legally written as debt owed when in default. Golden handshake should be the iron handcuff.

 

[SC Maintenance]

"Special financial assistance for financially troubled multiemployer plans is financed by general taxpayer monies." Last line of the About the PBGC. I'm conflicted about this. As stated, taxpayers should not pay. But I don't want a retiree to go hungry because depended on their pension.

Maybe a Corporation needs to have the officers or board personally responsible for the backing of debt. And pensions need to be legally written as debt owed when in default. Golden handshake should be the iron handcuff.

So this is news to me, so I dug into it. I stand corrected from my above posts - yes were paying. Thank you for the additional information.

"The American Rescue Plan (ARP) Act of 2021, enacted on March 11, 2021, allows certain financially troubled multiemployer plans to apply for special financial assistance. "

I Read elsewhere that it was $94B for 200 severely underfunded pensions.

So more government bailouts and slight of hand covid money. At least this time it goes to the little guy, but its printed money future generations will pay for either way.

 

[robbobster]

I’d be rich if Uncle Sam paid for my poor financial decisions.

And I would be an awesome rich guy…

 

[GMFan]

Privatize the gains, socialize the losses. Haven't we all seen this enough to know this is how the game is played? As George Carlin said, "It's a big club, and you ain't in it." Money is a social construct. People trade their labor for money - that money should be honestly gotten and that money should be sound and stable. Continuously chipping away at this social construct will only lead to further erosion of society.

Yes, the pensions should be covered. The criminals responsible should be stripped of any assets they have in exchange for a prison cell. We'll see if those responsible actually face penalties. There seems to be a strong theme lately in our country for justice to depend on how much wealth you have...