[Congressional Record (Bound Edition), Volume 159 (2013), Part 8]
[Extensions of Remarks]
[Pages 11533-11534]
[From the U.S. Government Publishing Office, www.gpo.gov]




           INTRODUCING THE AIRLINE PILOT PENSION FAIRNESS ACT

                                 ______
                                 

                           HON. GEORGE MILLER

                             of california

                    in the house of representatives

                         Tuesday, July 16, 2013

  Mr. GEORGE MILLER of California. Mr. Speaker, today, I am proud to 
introduce the Airline Pilot Pension Fairness Act, legislation that 
would prevent deep, unfair cuts in pilots' retirement benefits.
  Nearly forty years ago, Congress established the Pension Benefit 
Guaranty Corporation to insure the pension benefits of American 
workers. When employers terminate their workers' traditional pension 
plans, the PBGC takes the plans over and makes monthly payments to plan 
participants who are retired.
  When the PBGC takes over a company's pension plan, the plan 
participants do not always receive the same benefit they would have 
received if their plan had not terminated. For example, workers who 
retire before age 65--which the law considers ``normal'' retirement 
age--receive reduced benefits to reflect the longer period that these 
retirees likely will receive benefits.
  This is bad news for many pilots. Until 2007, under Federal Aviation 
Administration rules, airline pilots were required to retire at age 60. 
As a result, pilots whose pension plans were terminated--like the 
pilots at United Airlines and US Airways--wound up taking drastic cuts 
to their pension benefits because the PBGC treated age 60 as an early 
retirement age and cut pilots' guaranteed benefits as a result.
  This problem was caused because the FAA's mandatory pilot retirement 
age of 60

[[Page 11534]]

and ERISA's normal retirement age of 65 were not aligned. ERISA does 
not provide a special rule for pilots. Pilots earn every dime of their 
pension benefits and they didn't choose to retire at age 60. The time 
to fix this problem is today.
  The Airline Pilot Pension Fairness Act would put airline pilots 
subject to the old FAA rule on equal ground with other workers by 
requiring the PBGC to treat age 60 as the normal retirement age for 
these pilots--not as an early retirement age. In other words, these 
pilots would receive the maximum PBGC benefit for which they would be 
eligible if they worked until age 65. If they worked until the age of 
57, it would be as if they worked until age 62 and the pilot would 
receive the appropriate PBGC benefit.
  Eight years ago, in a 2005 e-hearing Tom Gardiner, of Bainbridge 
Island, WA, facing the loss of his retirement nest egg at United 
Airlines, explained the conundrum facing pilots--
  ``My name is Tom Gardiner and I am a Captain for United Airlines with 
a total of 27 years of service. . . . If the PBGC takes over the 
pilots' defined benefit plan, I will lose at least 
2/3 of my promised pension. . . . [One factor] contributing to this 
huge hit is the adjustment for `early retirement' mandated by PBGC 
rules. Of course, I have no choice in the matter; the FAA regulations 
require me to retire at age 60. The PBGC considers that to be `early' 
and takes away 35% of what I would otherwise receive from them. It is a 
classic `Catch 22'. . . .''
  Captain Gardiner is not alone. The Airline Pilot Pension Fairness Act 
would be a first step to restoring some measure of fairness to these 
hardworking Americans who have seen promised and hard-earned benefits 
disappear overnight.