U.S. to Assume United Air Pension Plan [View All]

[Rose Siding]

CHICAGO (Reuters) - The U.S. agency that backs corporate pensions on Friday said it was moving to take over bankrupt United Airlines' pension plan for ground employees, prompting a strike threat by the airline's machinists union.

The Pension Benefit Guaranty Corp. said it would guarantee payment of an estimated $2.1 billion in benefits out of the plan's $2.9 billion shortfall. Benefits will be paid at a reduced rate for retirees, while current employees would get a new, cheaper pension.

The news triggered strike action threat from the International Association of Machinists and Aerospace Workers, which represents United's ramp workers. Other ground workers include mechanics and related staff. The ground employee plan has more than 36,000 active and retired employees, the PBGC said.

http://reuters.com/newsArticle.jhtml?type=businessNews&storyID=7881529