Northwest Airlines applauded the U.S. Congress for its approval of pension reform legislation on Thursday, saying it would save the pension benefits of 73,000 current and former Northwest employees.
Northwest, which is in the midst of an attempt to exit bankruptcy, had negotiated a pension plan freeze with the union representing its employees. According to Northwest, employees rallied and came together to support the legislation to save their retirement benefits. An exemption applauded by the airline allowed an extension of time when the pension could be funded.
â€œOn behalf of the 73,000 participants in Northwest Airlinesâ€™ pension plans, and the families that depend on them, we thank all of the members of the House and the Senate that supported this important legislation,â€ said Doug Steenland, president and chief executive officer.
Delta, which is also in Chapter 11 bankruptcy, was also pleased with the decision. Under the terms of the bill, Delta and Northwest would be given 17 years to replenish their pension plans, while competitors Continental and American would get only 10. Northwest and Deltaâ€™s pension liabilities were in the billions of dollars.
Northwest had blamed 9/11 for partially contributing to its current state. During the weeks leading up the pension debate the firm along with it employees lobbied Congress heavily to pass the bill.
â€œWith employees making the difficult decision and sacrifice to freeze their pension plans, all of us looked to Congress for the additional time required to save our plans,â€ said Andrea Fischer Newman, Northwest's senior vice president of government affairs.
The U.S. Senate voted 93-5 to approved the bill identical to the one passed by the House of Representatives earlier by a 279-131 vote.