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Mr. AKAKA. Mr. President, today I am introducing the Pension Benefit Guaranty Corporation Pilots Equitable Treatment Act to ensure fair treatment of commercial airline pilot retirees. Joining me in this effort are Senators Harkin and Durbin, as well as Representative George Miller, who is introducing the companion bill in the House of Representatives today.
The Pension Benefit Guaranty Corporation, PBGC, is the Federal agency that assumes responsibility for pension plans that are terminated because they do not have enough money to pay all benefits. PBGC's insurance program pays monthly benefits to the retirees that the pension plan provided, up to the limits set by law. PBGC requires individuals to retire at age 65 to receive the maximum retirement benefit. For years, this law was in conflict with the Federal Aviation Administration, FAA, requirement that pilots retire by age 60. For commercial airline pilots caught between these conflicting policies, their retirement benefits were significantly reduced.
Congress partially addressed this issue with the passage of the Fair Treatment of Experienced Pilots Act, which was signed into law on December 13, 2007. The Act increased the FAA mandatory retirement age for pilots to age 65. However, the change did nothing to help those pilots who had already retired. As such, pilots who retired while the FAA age 60 rule was in effect are still denied the maximum pension benefit administered by the PBGC and are unable to rejoin the workforce as pilots.
The conflicting FAA and PBGC requirements have had a substantial adverse effect on thousands of retired pilots. In general, these pilots have had their maximum retirement benefit reduced by one-third. For example, the maximum benefit from the PBGC for someone that retired at age 65 in 2006 is $47,659 a year. For those who retired at age 60 of that same year, the maximum is $30,978. Our legislation ends this unfair penalty. The Pension Benefit Guaranty Corporation Pilots Equitable Treatment Act would direct the PBGC to calculate pension benefits based on retirement eligibility beginning at age 60 instead of age 65 for retired pilots whose pensions are affected by the discrepancy between the FAA and PBGC retirement requirements. We must pass this bill to provide some relief for pilots from Aloha Airlines, Delta, TWA, United Airlines, and US Airways, as well as other pilots who have had their pensions terminated and taken over by the PBGC and suffer from this wrongly imposed penalty.
I urge my colleagues to support this bill so that we can finally correct this wrong.
Proposal to amend title IV of the Employee Retirement Income Security Act of 1974
Thu, May 12, 2011
Mr. AKAKA. Mr. President, today I am introducing the Pension Benefit Guaranty Corporation Pilots Equitable Treatment Act to ensure fair treatment of commercial airline pilot retirees. Joining me in this effort are Senators Harkin and Durbin, as well as Representative George Miller, who is introducing the companion bill in the House of Representatives today.
The Pension Benefit Guaranty Corporation, PBGC, is the Federal agency that assumes responsibility for pension plans that are terminated because they do not have enough money to pay all benefits. PBGC's insurance program pays monthly benefits to the retirees that the pension plan provided, up to the limits set by law. PBGC requires individuals to retire at age 65 to receive the maximum retirement benefit. For years, this law was in conflict with the Federal Aviation Administration, FAA, requirement that pilots retire by age 60. For commercial airline pilots caught between these conflicting policies, their retirement benefits were significantly reduced.
Congress partially addressed this issue with the passage of the Fair Treatment of Experienced Pilots Act, which was signed into law on December 13, 2007. The Act increased the FAA mandatory retirement age for pilots to age 65. However, the change did nothing to help those pilots who had already retired. As such, pilots who retired while the FAA age 60 rule was in effect are still denied the maximum pension benefit administered by the PBGC and are unable to rejoin the workforce as pilots.
The conflicting FAA and PBGC requirements have had a substantial adverse effect on thousands of retired pilots. In general, these pilots have had their maximum retirement benefit reduced by one-third. For example, the maximum benefit from the PBGC for someone that retired at age 65 in 2006 is $47,659 a year. For those who retired at age 60 of that same year, the maximum is $30,978. Our legislation ends this unfair penalty. The Pension Benefit Guaranty Corporation Pilots Equitable Treatment Act would direct the PBGC to calculate pension benefits based on retirement eligibility beginning at age 60 instead of age 65 for retired pilots whose pensions are affected by the discrepancy between the FAA and PBGC retirement requirements. We must pass this bill to provide some relief for pilots from Aloha Airlines, Delta, TWA, United Airlines, and US Airways, as well as other pilots who have had their pensions terminated and taken over by the PBGC and suffer from this wrongly imposed penalty.
I urge my colleagues to support this bill so that we can finally correct this wrong.
