Did GM cut pensions?
Did GM cut pensions?
The two moves unveiled on Friday will cut $26 billion from the automaker’s massive U.S. pension liability of nearly $109 billion. GM’s pension overhang is a top concern for investors. These retirees are not part of the 118,000 affected by the pension overhaul announced Friday.
Are pensions affected by bankruptcies?
A Chapter 11 bankruptcy may or may not affect your pension or health plan. In a Chapter 7 bankruptcy, the company liquidates its assets to pay its creditors and ceases to exist. Therefore, it is likely your pension and health plans will be terminated.
When did GM stop pensions?
. 1, 2007
Effective Jan. 1, 2007, GM will freeze the accrued pension benefits for about 42,000 U.S. salaried employees and put them into new plans, a tactic many large companies are using to trim soaring pension costs.
When was the BEP merged into the General Motors retirement plan?
Effective January 1, 2007, the Benefit Equalization Plan (BEP) was merged into the Plan, the terms and conditions of which are set forth in Article III.
What was the outcome of General Motors bankruptcy?
Even amidst one of the worst recessions in United States history, no one would have expected General Motors to face financial failure. Fortunately, the company was reorganized and given a second chance. If it faced Chapter 7 bankruptcy instead, GM would have been completely dissolved.
When did GM get out of the pension business?
GM informed 118,000 of its white-collar retirees of upcoming changes to its pension program on June 1. At the crux of the change is the decision by No. 1 U.S. automaker to get out of the pension business by no longer administering the program that puts a check in a retiree’s bank account each month.
When do GM retirees have to make a decision?
That is the tricky choice thousands of former General Motors Co employees must make by July 20. It is also a decision that many more workers will make as other companies move expensive pension plans off their balance sheets.
What happens to the GM Pension Plan in bankruptcy?
In GM’s case, management has been working with the unions and the government to devise a restructuring plan that will be proposed to the bankruptcy judge. It is highly likely that the plan will be approved, although there may be some alterations.
Even amidst one of the worst recessions in United States history, no one would have expected General Motors to face financial failure. Fortunately, the company was reorganized and given a second chance. If it faced Chapter 7 bankruptcy instead, GM would have been completely dissolved.
How is General Motors using its pension fund?
General Motors is using its huge pension fund in a way it never intended. It had planned — and put money aside — for a steady march of retirees over time. But instead, tens of thousands of blue-collar workers, most in their 40s and 50s, are all becoming eligible for retirement benefits now, as the company rapidly downsizes.
What happens if you retire at 54 from General Motors?
Retired From G.M. at 54. Pensionless at 74? General Motors is using its huge pension fund in a way it never intended. It had planned — and put money aside — for a steady march of retirees over time.