|
 Printer-Friendly Version
EBSA News Release: [08/17/2004]
Contact Name: Gloria
Della
Phone Number: (202) 693-8666
U.S. Labor Secretary Elaine L. Chao Announces Agreement
with United Airlines to Appoint Independent Fiduciary to Manage Pension
Plans
WASHINGTON—U.S. Secretary of Labor Elaine L. Chao today
announced that an independent fiduciary will be appointed to represent the
interest of the participants and beneficiaries in United Airlines’ (UAL)
pension plans.
“United Airlines’ decision to stop funding its pension plans
made clear the need to appoint an independent fiduciary to represent the
interests of workers and retirees,” said U.S. Secretary of Labor Elaine L.
Chao. “This agreement ensures that workers’ interests are
protected.”
Under the terms of the agreement, signed today by the U.S. Labor
Department and UAL, the independent fiduciary will be selected by the company,
subject to the approval of the department. The independent fiduciary will be
responsible for issues related to the funding of the pension plans.
Specifically, the independent fiduciary is authorized to:
- Review the funding policy of the plans;
- Assert claims; and
- If necessary, bring litigation related to funding and contribution
issues on behalf of the plans.
In June, the UAL Board of Directors changed the structure for managing
its retirement plans by eliminating the plans’ administrative committee
and appointing UAL as the sole fiduciary for the plans. On July 15, UAL failed
to make a required $72 million contribution to three of the plans. On July 23,
the company announced that it would not make any of its legally and
contractually required contributions to the plans while still in bankruptcy.
Another payment of $400 million is due on September 15. Under the
department’s agreement, UAL must have an independent fiduciary in place
prior to September 15.
UAL sponsors four major pension plans covering nearly 120,000 employees.
The company filed for Chapter 11 bankruptcy on Dec. 9, 2002.
# # #
_________________________________________________________________
| 
