Delta to file request to terminate its pension plan for pilots

6/16/2006

ATLANTA Delta Air Lines Inc. will file a request Monday to terminate its pilots pension plan, the company s chief executive said in a letter to a lawmaker today.

CEO Gerald Grinstein said in the letter to U.S. Sen. Johnny Isakson that the nation s third-largest carrier will ask that the pilots pension plan be terminated effective Sept. 2.

The move was not unexpected, and Grinstein said the Atlanta-based airline is still seeking pension reform in Congress in hopes of preserving the pension plan for other employees.

The unfortunate reality is that even if a pension reform bill containing airline relief passes, unless the pilot plan is terminated, Delta cannot successfully restructure and emerge from bankruptcy, Grinstein wrote.

He added that the relief Delta is seeking is necessary if we are to preserve tens of thousands of jobs and provide ongoing service to tens of millions of customers in local communities around the world.

Once the notice is made to the Pension Benefit Guaranty Corp. on Monday, then the company will seek approval by a judge. There likely will be objections, though the pilots, for their part, have agreed not to object.

Delta has lost more than $14 billion in the last five years. It filed for bankruptcy last September and since then it has cut more jobs, rejected aircraft leases and reaped cost savings through pay cuts for employees.

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