DAYTON – IUE-CWA has reached a tentative agreement with the New General Motors to provide baseline security for retirees who are facing the loss of health care and pensions.

Under the agreement, pre-65 retirees covered by General Motors insurance will be offered an improved package with an extra $50 million in payments, on the high-deductible coverage originally presented.  Post-65 retirees will retain a $1 billion claim with old GM, now known as Motors Liquidation Co.

The agreement also secures a "top-up" from New General Motors for Delphi retirees whose pension was surrendered to the Pension Benefit Guaranty Corporation.  Because of that action the former Delphi workers stood to lose half of their income without this agreement.

"We were faced with very difficult decisions," said IUE-CWA President Jim Clark.  "Everyday we hear from severely ill retirees who would literally face a death sentence with the loss of health care and from retirees who would face bankruptcy if their pensions were slashed.

"Though this package falls short of what our retirees worked years to gain, under these circumstances with two major employers in bankruptcy we are pleased in what we were able to accomplish," Clark continued.  "This was the best we could get in a dreadful situation."

With the accord, New GM will honor its 1999 Benefit Guarantee and the 2007 tri-partite Memorandum of Understanding to ensure that eligible retirees at Delphi are made whole if the PBGC reduces their pensions.  Reductions could be made because the PBGC is not required to pay early retirement supplements or benefit increases made within the last five years.

The top-up also covers Delphi retirees in the process of growing into a pension benefit from a mutual retirement or the special pre-retirement package offered in the 2007 MOU.

GM had originally offered $417 million to provide health care coverage to eligible non-United Auto Worker pre-65 retirees and their dependents – and wanted to keep any unused money due to attrition for itself.  Union negotiators won an additional $50 million during the bargaining with GM and the U.S. Treasury, including a commitment that the entire amount will be spent on health care for union retirees.

The current health care plan, including dental and vision benefits, remains in effect for all current participants until Dec. 31, 2009.  Eligible pre-65 retirees will start to receive information on the cost of the modified-high deductible plan and forms to elect whether they want to take it in early fall.  IUE-CWA intends to offer a one-time buy-out option for those pre-65 retirees who opt not to take the plan.  Once retirees reach 65, and for those already over 65, GM-provided coverage will be eliminated.

Those over 65 or otherwise Medicare eligible could receive benefits or proceeds from a $1 billion claim that will remain against Motors Liquidation Co. in the bankruptcy court.  The amount and timing of any liquidation are impossible to estimate.  IUE-CWA will remain on the unsecured creditors' committee to maximize recovery for those retirees.

The $467 million and the $1 billion claim are monies that cover not just IUE-CWA retirees, but all of the union retirees who were excluded in the UAW-GM deal.

"We deliberately proceeded in these talks with a goal of being inclusive of those in other unions.  We believe we had a moral obligation not to leave those brothers and sisters out in the cold," said Clark.  "Whatever slim leverage we had, they had little or none.  Our talks were the only way to win some measure of health care coverage for those retirees."

Other union retirees who could receive health care benefits under the deal include the Electrical Workers, Operating Engineers, Machinists, Teamsters, Carpenters and Steelworkers.  The USW was a partner with IUE-CWA in the negotiations.

The agreement also provides $10,000 life insurance coverage that does not reduce with age.

Further, the agreement also provides that new GM will assume IUE-CWA Local 798's closing agreement for the Moraine Truck and Bus plant and fulfill obligations for buy-out payments.  In order to secure movement of the agreement to new GM, the company insisted that IUE-CWA accept the UAW concession to cut supplemental unemployment benefits in half the second year.

Clark stated that the union will continue to pressure the government to improve the health care coverage of the GM and Delphi retirees. 

"These workers earned high quality health care coverage and the government has now allowed for it to be taken away," he stated.  "There is nothing in this agreement that precludes the Treasury Department and the Obama Administration from recognizing the injustice they have caused and correcting the situation – either on their own or as directed through congressional action.  We will continue to pursue justice through every avenue available to us."

story taken from http://www.iue-cwa.org/news/iue-cwa-reaches-agreement-on.html

DAYTON – IUE-CWA, the Industrial Division of the Communications Workers of America, is moving aggressively to protect the interests of more than 41,000 represented retirees and their dependents with a filing to stop General Motors' plan to sell its viable assets.

The objection, to be filed today in the Southern District of New York Bankruptcy Court, seeks to prevent GM's proposed Section 363 sale that would strip GM of the resources needed to pay the health care and other benefits promised IUE-CWA retirees.  The union estimates its claims against GM will top $5 billion, the vast majority of which are the benefits owed to retirees.

The union states that GM is violating bankruptcy code with disparate treatment of groups of retirees who have the same promised benefits, noting that under Section 1114 the company must show that any proposed reduction is fair and equitable when compared to how similar groups are dealt with.

The filing calls GM "not only unfair, but cruel," for protecting lifetime health and life insurance benefits for retirees similarly situated under the United Auto Workers while leaving IUE-CWA retirees and another 6,500 retirees represented by other unions with unsecured creditor claims against a company that will have no assets if the planned sale goes through.

IUE-CWA reached agreement with GM on a voluntary employee beneficiary association to cover its members in December 2008 but the company refused to implement the VEBA citing requirements imposed by the U.S. Treasury Department in its initial bailout assistance.  Since then, GM has made no offers on how to resolve the benefits issue.

"With the Treasury Department's apparent blessing, GM is trying to subvert the bankruptcy process by using the sale to reorganize the company without meeting any of the standards set by the bankruptcy code," said IUE-CWA President Jim Clark.  "If GM is successful, our retirees will be left holding an empty bag.  The law does not allow favoritism for powerful creditors and we will not allow this grossly unfair attempt to cheat our retirees to proceed unchecked."

Original Post from IUE-CWA Website