House Approves Restoring Delphi Retiree Benefits
The U.S. House of Representatives has passed legislation to restore retirement benefits to more than 20,000 Delphi salaried retirees, including over 5,800 in Michigan.
When General Motors (GM) filed for bankruptcy during the Great Recession, the U.S. Pension Benefit Guarantee Corporation (PBGC) cut retirement benefits by as much as 70 percent for those retirees. The PBGC assumed responsibility for the terminated benefits but could not pay an individual more than a statutory maximum benefit. Therefore, salaried retirees suffered significant losses to their benefits, with devastating impacts on many lives.
Sponsored by Congressman Dan Kildee, the legislation would restore the terminated pensions. This bill would make up the difference between the pension benefits earned by Delphi salaried retirees and what they received following the GM bankruptcy in 2009. Beneficiaries who have already begun receiving benefits will receive a lump sum payment of the difference between what was actually paid by PBGC and would have been paid without the limitations, plus 6 percent interest. To ease the tax burden, retirees may pay income taxes on this lump sum over three years. Moving forward, all beneficiaries will receive their full earned benefit.