Friday, May 4, 2012
Hawker Beechcraft has received approval from a federal bankruptcy court to continue paying employees, vendors and suppliers.
There are still many questions about the filing and what it means to current and retired workers. Wichita bankruptcy attorney Bill Zimmerman says planes will continue to be built and, for all practical purposes, Hawker Beechcraft will continue operating during its restructuring.
"The whole idea is to maintain value by continuing to operate," said Zimmerman.
Something catching employees' attention is a statement on the company website that Hawker may have to terminate its pension plan. Zimmerman says it's not a done deal and there has to be a good faith negotiation.
"There has to be bargaining. They can not unilaterally take action to terminate or modify the pension rights," he said.
PBGC is the Pension Benefit Guaranty Corporation. The PBGC's job is to protect the pension benefits for workers and retirees. Spokesman Michael Rae says any changes to the current pension program will have to go through them first.
"If a company wants to terminate its pension plan or feels the need to terminate its pension plan as part of its restructuring, the company would have to prove to the bankruptcy court and to the PBGC that it can no longer afford to keep its pension promises," said Rae.
Rae says Hawker has three pension plans with about $770 million in assets, but its obligations are $1.4 billion, which means it's only 56 percent funded. Hawker would have to demonstrate to the bankruptcy court and to the PBGC that the pension plans are no longer affordable before they could terminate the program.
"Then PBGC steps in and will pay participants their guaranteed benefits to current retirees and future retirees," said Rae.