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Boeing to end pension plans for non-union employees

  • Boeing (BA +0.2%) says it will end pension plans for 68K non-union employees, including top executives, transitioning to a 401(k)-style retirement plan starting in 2016.
  • Boeing, which contributed $1.5B to its pension fund in 2013, expects to record a related $110M non-cash pension curtailment charge in its Q1 2014 results, in addition to $220M of previously announced charges related to recent labor agreements with union machinists.
  • Retirees already receiving pension benefits are not affected by the change.
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Comments (13)
  • minwyhe
    , contributor
    Comments (103) | Send Message
     
    Once again the pockets of the executives is paramount and let the rank and file suffer. Time for corporate executives to treat employees as they treat themselves. Now you can see why unions had to save workers at the beginning of the 20th century and perhaps a new movement needs to occur to protect the workers now.
    6 Mar 2014, 03:57 PM Reply Like
  • salvatort
    , contributor
    Comments (378) | Send Message
     
    "68K non-union employees, including top executives". Did you even read it?
    6 Mar 2014, 04:45 PM Reply Like
  • curreyr
    , contributor
    Comments (728) | Send Message
     
    McNerney joined Boeing as chairman, president and CEO on July 1, 2005.
    6 Mar 2014, 06:08 PM Reply Like
  • 10638221
    , contributor
    Comments (4) | Send Message
     
    Jimmy is retire this years. While CEO of Boeing in 2007, W. James McNerney Jr. earned a total compensation of $12,904,478, which included a base salary of $1,800,077, a cash bonus of $4,266,500, options granted of $5,871,650, and Other $966,251.
    7 Mar 2014, 01:38 AM Reply Like
  • minwyhe
    , contributor
    Comments (103) | Send Message
     
    Which executives and to what level? No mention was made if all the executives were included. I am sure that the top executives have not been affected for sure. Perhaps, a look at the annual report will really show what the top echelon earned.
    7 Mar 2014, 10:11 AM Reply Like
  • alkmaar
    , contributor
    Comments (30) | Send Message
     
    Should have done that a decade ago.

     

    Even though Motorola did that two decades ago, they don't exists anymore. (Well, I know, they were bought by the Chinese from Google as a piece; and the Motorola Solution part still exists.)
    6 Mar 2014, 04:01 PM Reply Like
  • GarryGR
    , contributor
    Comments (243) | Send Message
     
    HMmmm, I didn't know there were any non-union pensions left. I retired in 2008 and our Boeing pension contributions were eliminated in 2001, I think. I have a pension but it's just not as large as it would have been had the Boeing contributions continued. Boeing added 2% to my 401K contributions after that.

     

    I believe that pensions came into being during the wage freeze times of the war and after, not because of union negotiations. I asked a reporter once about that but she said she couldn't determine whether Boeing initiated the pensions unilaterally or if the unions negotiated for them; I believe it's likely Boeing did what other companies were doing, i.e. adding pensions as a recruitment enticement. The IAM unions negotiated increases to the pensions but I don't think they can (as they did) claim that they came up with the pension idea.

     

    Anybody know how and when Boeing's pensions came to be?
    6 Mar 2014, 04:28 PM Reply Like
  • thomas85225
    , contributor
    Comments (563) | Send Message
     
    from John Dern Boeing Corporate Offices
    Office: 312-544-2002 john.dern@boeing.com

     

    If you have any questions or comments about this page please contact pressreleases@worldnow...
    SOURCE Boeing

     

    Boeing Announces Future Retirement Plan Changes for Nonunion Employees

     

    Information contained on this page is provided by an independent third-party content provider. WorldNow and this Station make no warranties or representations in connection therewith. If you have any questions or comments about this page please contact pressreleases@worldnow...
    SOURCE Boeing

     

    Move continues delivering market-leading retirement benefits while strengthening competitiveness
    Provides company contributions each pay period to a new defined contribution retirement savings component
    Offers employees access to free, personal retirement counseling services
    Ensures a consistent approach to retirement benefits across nearly all nonunion and union populations

     

    CHICAGO, March 6, 2014 /PRNewswire/ -- Boeing [NYSE: BA] today provided advance notice to nonunion employees participating in the company's defined benefit pension plans that they will transition in 2016 to a company-funded defined contribution retirement savings plan.

     

    Beginning Jan. 1, 2016, Boeing will make cash contributions each pay period to employees' retirement savings through a new defined contribution component of the 401(k) plan. All benefits earned in the current traditional pension plan prior to the transition will be paid to employees in retirement, and the company will continue to match employee savings in an existing 401(k) plan.
    The transition covers roughly 68,000 employees, including managers and executives, who participate in the main Boeing and subsidiary defined benefit pension plans. Retirees already receiving pension benefits are not affected by this change.
    "Our objective in making this transition is twofold: continue providing an attractive, market-leading retirement benefit contributing to employees' retirement security, while also assuring our competitiveness by curbing the unsustainable growth of our long-term pension liability," said Tony Parasida, senior vice president of Human Resources and Administration.
    Notice of the impending change is the latest in a series of steps the company has taken to address the challenges created by defined benefit pension plans. For example, all nonunion employees hired since 2009 and new hires of 28 unions have been moved to defined contribution plans, which help Boeing to better predict and manage financial risks, while still providing its employees a market-leading retirement benefit.
    Similar changes were also included in contract extensions ratified this year by members of the company's biggest union, the International Association of Machinists and Aerospace Workers (IAM) District 751 inSeattle and IAM District 837 in St. Louis.
    The new benefit will supplement employees' defined benefit pensions earned through Dec. 31, 2015. All pension benefits earned through the end of 2015 are the employees' to keep. The credit-based portion of employees' defined benefit pension will grow with interest credits until employees begin receiving their pension benefit.
    Features of the transition plan include:
    A three-year transition benefit to employees' 401(k) accounts equal to 9 percent of their eligible income in 2016, 8 percent of income in 2017 and 7 percent of income in 2018. (Eligible income includes base salary, incentive pay and shift differential, if applicable.)
    Pay-period contributions to 401(k) accounts of 3 percent to 5 percent of eligible income, depending on age, beginning in 2019.
    Access to free, personal retirement counseling services for up to two years.
    Access to seminars and online retirement planning modeling tools to help employees reach their retirement goals.
    Upon initiating retirement benefits, employees will receive the combined value of their company-funded defined pension benefit and new defined contribution benefit, along with existing 401(k) voluntary retirement savings, the company's matching contributions to those savings, as well as Social Security benefits, when eligible.
    The company expects the changes to have an immaterial impact on 2014 core (non-GAAP) earnings. GAAP earnings for 2014 will also include a non-cash pension curtailment charge of approximately $110 million that will be recorded in the first quarter. The $110 million charge is in addition to previously announced $140 million and $80 million non-cash charges also being recorded in the first quarter for changes to retirement plans under the contract agreements with the IAM 751 and IAM 837 unions.
    Forward-Looking Information Is Subject to Risk and Uncertainty
    Certain statements in this release may be "forward-looking" within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as "expects," "forecasts," "projects," "plans," "believes," "estimates," and similar expressions are used to identify these forward-looking statements. Examples of forward-looking statements include statements relating to our future plans, business prospects, financial condition and operating results, as well as any other statement that does not directly relate to any historical or current fact. Forward-looking statements are based on current assumptions about future events that may not prove to be accurate. These statements are not guarantees and are subject to risks, uncertainties and changes in circumstances that are difficult to predict. Many factors could cause actual events to differ materially from these forward-looking statements, including economic conditions in the United States and globally, general industry conditions as they may impact us or our customers, and other important factors disclosed previously and from time to time in our filings with the Securities and Exchange Commission. Forward-looking statements speak only as of the date they are made and we undertake no obligation to update or revise any such statement, except as required by law.
    Contact:
    John Dern
    Boeing Corporate Offices
    Office: 312-544-2002
    john.dern@boeing.com
    7 Mar 2014, 01:34 PM Reply Like
  • healthythoughts
    , contributor
    Comments (3083) | Send Message
     
    Boeing pensions were part of the package to attract great talent. The VIP (voluntary income protection) was added when IRA's came about (similar to 401k)...In order to compete with overseas companies receiving government subsidies, the 401K became the retirement package for many. In this most recent case top executives/& other "non union" employees, will no longer have traditional retirement, beginning 2016

     

    The pensions of the past are just that..in the past...

     

    If you are vested, all the pension you gained at that point, is still guaranteed, although it stops at that point & becomes 401K, Vip, etc
    6 Mar 2014, 06:40 PM Reply Like
  • Coolbluelake
    , contributor
    Comments (595) | Send Message
     
    Maybe unions aren't such a bad idea after all. I wonder if the CEO's of companies like Boeing will be willing to take a cut in their $20-$30 million dollar bonuses?

     

    The CEO of Caterpillar gets a $20 million dollar a year bonus, but the average wage at (CAT) is just $15 bucks an hour. How generous. Next thing CAT will do now is try to get rid of pensions too.
    6 Mar 2014, 10:41 PM Reply Like
  • thomas85225
    , contributor
    Comments (563) | Send Message
     
    Northrop Aircraft offer full benefits and pension plan and two weeks off at Xmax to kept out the union years ago

     

    40% of Boeing is retiring in the next five years

     

    Boeing Announces Future Retirement Plan Changes for Nonunion ...
    http://bit.ly/1fNonVR- nonunion-...

     

    Boeing loses appeal over Oklahoma workers' retirement benefits
    http://bit.ly/1fNopgu

     

    Boeing pension plan will end for the IAM local 751 in 1-2016
    Speea ? Mild and upper management that are non union ?

     

    Only 35% of Boeing is Union 20% IAM, 13% Speea, 2% UAW

     

    The IAM local 751 should not be making agreement and give always benefits without the agreement from ALL the Unions at Boeing

     

    UAW represents Boeing in Long Beach California and Philadelphia

     

    The IAM only represent:
    Boeing in Washington State local 751,
    Missouri local 688,
    Portland Oregon Lodge 2911,
    Kansas IAM Lodge 70 and the commercial division in Kansas was sold off in 2005 to Oxen’s of Canada is represents By IAM Lodge 70 and Military side is moving to Texas
    Boeing Utah is Union only on military programs
    Oklahoma union N/A

     

    AZ, Fl, TX, OK. PA, AL, LA, SC, Japan, China are not represented by a Union
    The Boeing started offloading with the B-17F in 1943 to Vega- Lockheed and Douglas alone with parts, sub assemblies, super panel and barrels section of their aircraft's

     

    Boeing is organized into five primary divisions:
    Boeing Commercial Airplanes (BCA), Boeing Commercial Headquarters is located in the City of Renton see rentonwa.gov/blank_pop...
    Boeing Defense, Space & Security (BDS),
    Engineering, Operations & Technology,
    Boeing Capital and Boeing Shared Services Group.

     

    Boeing is building another HQ in Washington DC
    http://bit.ly/1fNopwK

     

    The IAM local 751 was FIRED as the Union in South Caroline for NON PERFORMANCE
    http://bit.ly/Z0cDKX

     

    Boeing CEO got 27 millions bonues and Ray Conner got 60,000
    6 Mar 2014, 11:49 PM Reply Like
  • 10638221
    , contributor
    Comments (4) | Send Message
     
    Jimmy is retiring this year..While CEO of Boeing in 2007, W. James McNerney Jr. earned a total compensation of $12,904,478, which included a base salary of $1,800,077, a cash bonus of $4,266,500, options granted of $5,871,650, and Other $966,251.
    7 Mar 2014, 01:38 AM Reply Like
  • 10638221
    , contributor
    Comments (4) | Send Message
     
    Jimmy is retiring this year. While CEO of Boeing in 2007, W. James McNerney Jr. earned a total compensation of $12,904,478, which included a base salary of $1,800,077, a cash bonus of $4,266,500, options granted of $5,871,650, and Other $966,251.
    7 Mar 2014, 01:38 AM Reply Like
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