Delta Is Making Life Harder for Retired Employees

May 5th 2017

April was a tough month for airlines.

United and American Airlines personnel treated customers poorly, and it was all caught on tape.

Yet while the airlines are under scrutiny for their staff's poor treatment of customers, Delta is taking huge chunks of its employees' hard-earned pensions away due to a clause in their contract that was never enforced — when workers had a union fighting for them.

ATTN spoke to a man who said he's a victim of the airline's pension scheme. He said there are many others like him, and that they're fighting to get back what they believe is rightly theirs.

In 2008, a merger brought unionized employees from the airline Northwest into the largely non-unionized workforce of Delta. In 2010, Delta employees as a whole — now including the Northwest employees — rejected a union.

Delta worked hard to achieve that outcome, promising incentives like profit sharing and a healthy benefits package to discourage collective organizing. The approach worked, and at first it seemed that the employees were none the worse for it.

In February 2014, Business Insider reported, "most of Delta's now 80,000 employees got bonus checks equal to roughly a month's salary."

Kip Hedges was hired by Northwest in 1988 as a baggage handler. He's a strong union supporter — and he lost his job in 2014 for speaking out for higher wages, he said.

"As a result of a public statement I made about many Delta workers not making $15 an hour the company fired me on December 2, 2014," Hedges told ATTN:.

He provided video showing him talking to a progressive group, Workday Minnesota, about a $15 minimum wage for airline workers. Delta would not comment on Hedges' employment with the company when asked by ATTN:. However, in 2014 the company told the Twin Cities Pioneer Press that Hedges was fired over "disparaging remarks." 

"Delta regrets any instance where a longtime employee is terminated," the company said in a statement. "However, Delta requires all employees to meet company performance and conduct standards. This includes upholding our core values of respect and honesty in any communications regarding Delta."

Being fired didn't stop the union booster from speaking out. Less than a week later, he was back at his former workplace, continuing to fight for workers' rights.

Hedges filed suit for wrongful termination against the company and arrived at a settlement. He left with a medical retirement, but because of the wording in Delta's pension plan, that settlement will come back to bite him.

In essence, Hedges is now paying for that settlement with his own money.

Indeed, when Hedges turns 65 on Sept. 4, 2018, the company will begin subtracting $450 a month from his pension payments.

It wasn't always this way. While the company's pension agreement does specify that "any Plan payments you receive after age 65 may be offset (reduced) by these Workers’ Compensation benefits," this language was never enforced. Hedges thanks the union for that.

"The union prevented the company from ever enforcing" the policy, he said. "Probably for 50 years."

Delta spokesman Daniel Kruse told ATTN: that the company had "no information to share at this time" on the predicament of Hedges and other disabled former employees.

At least one retiree is doing well, though. Former Delta CEO Richard Anderson left the company last year with $72 million in stock.

According to The Atlanta Journal-Constitution, Anderson exercised all his stock options upon leaving the company. The airline tried to frame the payout as part of the company's ostensible philosophy of a rising tide lifting all boats.

“All Delta employees share in the success of the company when it performs well,” Delta spokesperson Morgan Durrant told the paper in an email.

The retirees who are seeing their pensions slashed hope the company lives up to that promise and reverses its decision to enforce the pension clause.

"That's what we are hoping for,"  Hedges said. His lawyer is working with 100 retirees in the same position in the Minneapolis-area alone, he said. "My guess is it [affects] thousands."

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