The following piece was published in the Ottawa Citizen yesterday. I'm sure all other Nortel Canadian pensioners feel the same way. Don't forget your votes count too.
Nortel victims are dancing with demagogues
The Ottawa CitizenJuly 30, 2010
As a Nortel pensioner, unsecured in bankruptcy protection, I have on numerous occasions written to our Ottawa area Conservative MPs, beginning in January 2009.
Stating the plight of Nortel displaced employees, pensioners, and long-term disabled, I have pleaded with them to represent and support the constituents within their ridings. To date, I have been distressed by their responses that are filled with deflections, double-speak, and ambivalence. As they transfer fault back to us, the victims, I wonder if I am I dancing with demagogues who simply don't give a damn.
Ottawa West-Nepean MP John Baird, Carleton-Mississippi Mills MP Gordon O'Connor, and Nepean-Carleton MP Pierre Poilievre represent thousands of former Nortel employees for whom justice-in-bankruptcy will end on Sept. 30. It is time they stop the platitudes expressing concern and address the issue. The date is real and action is required -- now.
What will these MPs say to thousands of their constituents who have lost 35+ per cent of their pension on Oct. 1. How will they personally, and publicly, rationalize their guaranteed life-time pensions and benefit security?
I implore them to consider the future impact of their position and re-election. It is time to do the right thing. It is time to publicly show political will and courage. Will they continue to succumb to powerful lobbyists, or will we be abandoned as disposable victims of the unconscionable harm inflicted by the current bankruptcy laws?
In eight short weeks we will know the answer. Let it not be said; " Sirs, you had a choice "
John Tyson,
Ottawa
© Copyright (c) The Ottawa Citizen
Saturday, July 31, 2010
Friday, July 30, 2010
Koskie Minsky Bulletins ( Includes Canada pension fund % updates)
Koskie Minsky has issued two bulletins and has them posted on their website. You can see the details by going to the following web address:
http://www.koskieminsky.com/Case-Central/Overview/Status-Of-Case/?rid=107
The following is my summary of the content of the bulletins which affect Nortel Canada pensioners, disabled employees, and ex-employees.
Pensions.
The latest estimate of the trust fund ratio is 64% on a wind up basis for both the negotiated and managerial defined benefit plans. On a solvency basis the ratio is 76% for the negotiated and 72% for the managerial.
When the Ontario administrator takes over October 1 your pensions will be reduced to one of these funding ratios. For those who worked in Ontario the first $1000 per month (adjusted for service in Ontario) will be protected by the Ontario Pension Benefit Guaranty Fund. The remainder of the monthly pension will be reduced to the funding ratio.
The NRPC and advisers are exploring alternatives to a conventional pension plan wind-up and are seeking support from the government. Depending on the results of these efforts the timing of the wind up could be affected as well as the future administration of the plan.
For those in the Defined Contribution plan you will be able to withdraw your full individual pension in your account and transfer it to a locked in retirement vehicle. You will not suffer any loss but will not have any further pension claim on Nortel.
People with questions regarding defined benefits plans, may contact Mercer at 1-866-667-8358.
People with questions regarding defined contribution plans may contact Sun Life at 1-866-733-8612.
Compensation Claims Procedure.
Koskie Minsky hopes to go before the court in September 2010 to obtain agreement on the claims procedure.
Every one will receive written documentation from K.M. with all details associated with their individual claims including; pension, TRA, excess pension, severance, health, dental, and life insurance.
You will have a chance to review the claims in detail and ensure that all information related to your claims is correct. If not you will have a chance to engage with K.M. to make sure everything is right before proceeding.
You do not have to file your own claim. Koskie Minsky will do that for you.
Once claims have been received, verified, and tallied, and once the total Canadian assets available for distribution are determined there will be a distribution of assets based on the percentage of money available to all unsecured creditors. This probably will not happen until 2011. There may be an interim distribution, but that is unknown at this stage.
Health and Dental Benefits
Nortel will cease to pay these benefits on December 31 2010. You must submit a claim by February 28,2011.
The proposal to create a Replacement Health Plan through future cash recoveries has been dropped. (See the bulletin for details). As a result each individual entitled to health and dental benefits from Nortel will have to file a claim.
Group Life Insurance Coverage
This coverage will cease on December 31,2010. Individuals will have a claim against Nortel for the loss. The claim will be part of the Compensation Claims procedure.
Health and Welfare Trusts Assets.
K.M. and other parties including the monitor are working towards a court approved distribution of the HWT in 2010. K.M. expects the Monitor to make a proposal for the allocation of assets. Individual beneficiaries will have an opportunity to make submission to the court on the proposal.
On December 2009 the assets in the trusty was estimated to be $80 million while liabilities are much higher. The loss of future benefits as a result of this situation will be part of individual claims against Nortel in the Compensation Claims Procedure.
The actuary, working with K.M., put forward before the court in March 2010, that the HWT would only produce a 30% payout based on the liabilities and the estimated assets. K.M. has demanded that each disabled person receive an estimate of the amount they will receive through a distribution of HWT assets under the Monitor’s proposal.
Each disabled person will have the support of an actuary to calculate their individual claims based on the present value of lost future benefits.
The goal is to achieve allocation and distribution of the HWT assets before the end of 2010.
Health and Welfare Fund Distribution Taxes.
K.M has submitted a proposal to the Canadian Revenue Agency to reduce or eliminate taxes on the lump sum payments from the HWT to eligible beneficiaries who are receiving disability benefits, have group life insurance, or come under the survivor income benefit plan. There is no response yet from the CRA.
Court Appointed Representative- disabled personnel.
Susan Kennedy is the court appointed representative for Nortel’s disabled employees, with the exception for CAW-Canada members. K.M. has received requests to add two additional representatives for the disabled employee group. After examination the request has not been granted. (See bulletin for details).
Termination Fund and payments.
Eligible terminated employees are entitled to a lump sum payment up to $3000. K.M. anticipates payments to be made in the fall 2010.
Foreign Service earnings.
The CRA completed their review and concluded that Nortel’s historical practice of including Foreign Service earnings as eligible earnings for the purposes of pension benefits is acceptable.
Employee hardship Process.
The process in Canada has been extended until October 29, 2010. K.M. have requested the possibility of establishing a hardship fund to apply to pensioners and survivors for use after December 2010. There is no news yet on that possibility.
Future updates.
Once the Compensation Claims Process has been approved, KM may schedule information sessions in various cities to provide more information about claims and related court procedures. These events as well as future webcasts will be announced on the K.M. website as well ads the NRPC website.
http://www.koskieminsky.com/Case-Central/Overview/Status-Of-Case/?rid=107
The following is my summary of the content of the bulletins which affect Nortel Canada pensioners, disabled employees, and ex-employees.
Pensions.
The latest estimate of the trust fund ratio is 64% on a wind up basis for both the negotiated and managerial defined benefit plans. On a solvency basis the ratio is 76% for the negotiated and 72% for the managerial.
When the Ontario administrator takes over October 1 your pensions will be reduced to one of these funding ratios. For those who worked in Ontario the first $1000 per month (adjusted for service in Ontario) will be protected by the Ontario Pension Benefit Guaranty Fund. The remainder of the monthly pension will be reduced to the funding ratio.
The NRPC and advisers are exploring alternatives to a conventional pension plan wind-up and are seeking support from the government. Depending on the results of these efforts the timing of the wind up could be affected as well as the future administration of the plan.
For those in the Defined Contribution plan you will be able to withdraw your full individual pension in your account and transfer it to a locked in retirement vehicle. You will not suffer any loss but will not have any further pension claim on Nortel.
People with questions regarding defined benefits plans, may contact Mercer at 1-866-667-8358.
People with questions regarding defined contribution plans may contact Sun Life at 1-866-733-8612.
Compensation Claims Procedure.
Koskie Minsky hopes to go before the court in September 2010 to obtain agreement on the claims procedure.
Every one will receive written documentation from K.M. with all details associated with their individual claims including; pension, TRA, excess pension, severance, health, dental, and life insurance.
You will have a chance to review the claims in detail and ensure that all information related to your claims is correct. If not you will have a chance to engage with K.M. to make sure everything is right before proceeding.
You do not have to file your own claim. Koskie Minsky will do that for you.
Once claims have been received, verified, and tallied, and once the total Canadian assets available for distribution are determined there will be a distribution of assets based on the percentage of money available to all unsecured creditors. This probably will not happen until 2011. There may be an interim distribution, but that is unknown at this stage.
Health and Dental Benefits
Nortel will cease to pay these benefits on December 31 2010. You must submit a claim by February 28,2011.
The proposal to create a Replacement Health Plan through future cash recoveries has been dropped. (See the bulletin for details). As a result each individual entitled to health and dental benefits from Nortel will have to file a claim.
Group Life Insurance Coverage
This coverage will cease on December 31,2010. Individuals will have a claim against Nortel for the loss. The claim will be part of the Compensation Claims procedure.
Health and Welfare Trusts Assets.
K.M. and other parties including the monitor are working towards a court approved distribution of the HWT in 2010. K.M. expects the Monitor to make a proposal for the allocation of assets. Individual beneficiaries will have an opportunity to make submission to the court on the proposal.
On December 2009 the assets in the trusty was estimated to be $80 million while liabilities are much higher. The loss of future benefits as a result of this situation will be part of individual claims against Nortel in the Compensation Claims Procedure.
The actuary, working with K.M., put forward before the court in March 2010, that the HWT would only produce a 30% payout based on the liabilities and the estimated assets. K.M. has demanded that each disabled person receive an estimate of the amount they will receive through a distribution of HWT assets under the Monitor’s proposal.
Each disabled person will have the support of an actuary to calculate their individual claims based on the present value of lost future benefits.
The goal is to achieve allocation and distribution of the HWT assets before the end of 2010.
Health and Welfare Fund Distribution Taxes.
K.M has submitted a proposal to the Canadian Revenue Agency to reduce or eliminate taxes on the lump sum payments from the HWT to eligible beneficiaries who are receiving disability benefits, have group life insurance, or come under the survivor income benefit plan. There is no response yet from the CRA.
Court Appointed Representative- disabled personnel.
Susan Kennedy is the court appointed representative for Nortel’s disabled employees, with the exception for CAW-Canada members. K.M. has received requests to add two additional representatives for the disabled employee group. After examination the request has not been granted. (See bulletin for details).
Termination Fund and payments.
Eligible terminated employees are entitled to a lump sum payment up to $3000. K.M. anticipates payments to be made in the fall 2010.
Foreign Service earnings.
The CRA completed their review and concluded that Nortel’s historical practice of including Foreign Service earnings as eligible earnings for the purposes of pension benefits is acceptable.
Employee hardship Process.
The process in Canada has been extended until October 29, 2010. K.M. have requested the possibility of establishing a hardship fund to apply to pensioners and survivors for use after December 2010. There is no news yet on that possibility.
Future updates.
Once the Compensation Claims Process has been approved, KM may schedule information sessions in various cities to provide more information about claims and related court procedures. These events as well as future webcasts will be announced on the K.M. website as well ads the NRPC website.
Thursday, July 29, 2010
Nortel US asks court to hire RLKS to destroy records
Nortel US has asked the bankruptcy court for relief to hire RLKS to assist in the wind down and liquidation of the Nortel businesses and estates. RLKS would work to preserve some important records, and destroy the rest of the records kept in electronic and hard copy format.
RLKS was employed in the wind down of Enron Corporation.
Nortel would pay RLKS a retainer of $15,000 and the two main RLKS reps $450 per hour as well. Pretty good pay for shredding paper and erasing data files I would say.
It would seem that this is the beginning of the last phase as liquidation looms. Lets hope that all the proper documents and data files have been handed over to the PBGC and other organizations that need to ensure the rights of the people left behind are protected. There still are thousands of claims outstanding and the employment, pension, and disability information on those people are paramount to ensuring they receive repayment on their claims when the liquidation is completed.
There is also the question of financial records, board and management decisions, and actions taken that might be required in future legal cases. Once again the importance of retaining those records may make a big difference in term of the results of future legal battles.
Who is minding the store and watching to ensure that only non-essential material is destroyed?
RLKS was employed in the wind down of Enron Corporation.
Nortel would pay RLKS a retainer of $15,000 and the two main RLKS reps $450 per hour as well. Pretty good pay for shredding paper and erasing data files I would say.
It would seem that this is the beginning of the last phase as liquidation looms. Lets hope that all the proper documents and data files have been handed over to the PBGC and other organizations that need to ensure the rights of the people left behind are protected. There still are thousands of claims outstanding and the employment, pension, and disability information on those people are paramount to ensuring they receive repayment on their claims when the liquidation is completed.
There is also the question of financial records, board and management decisions, and actions taken that might be required in future legal cases. Once again the importance of retaining those records may make a big difference in term of the results of future legal battles.
Who is minding the store and watching to ensure that only non-essential material is destroyed?
Wednesday, July 28, 2010
US Medicare plans
When Nortel made its recent attempt to terminate the medical plan for retirees it made some agreement with United Healthcare who sent out materials with their plans for retirees.
The one I received in Georgia was for a Medicare Advantage plan that was an HMO. It looked pretty good since there was no added premium and I could go to my primary doctor for a copay of $15 and my specialists for for a $40 copay. It even had an optional dental and vision rider that I could purchase.
Everything looked good until I checked with my primary care doctor and found that his practise did not accept this insurance. All my specialists were listed in the database but not him. It seems that this is quite common with many HMOs and it is really unfortunate since the primary care doctor is the one most seen by people. Maybe the copay is just too low. I checked on the United healthcare site and found that my doctor was in many of the other insurance plans they offer but not this one.
So I called the billing department of my doctor's office and they were very patient but explained to me that they just did not want to be involved in that type of insurance. They told me that however they did accept Medicare Advantage PFFS plans and perhaps I should look into that. (PFFS is Private Fee For Service)
So I looked at the booklet Medicare had sent out to me at the beginning of the year to see what Medicare advantage plans they offer. If you don't have the booklet you can look up the plans at the Medicare website. There are many different plans offered by a number of insurance companies including the same one that United Healthcare had sent out to us. There are also Medigap plans which are supplementary plans to basic Medicare which you can find by looking at the various insurance company sites. In my case I am more interested in the advantage plans so those are the ones I concentrated on.
Each plan is specific not only for the state you live in but also the county within that state. I found out that in Fulton County, Georgia, where I live, the United Healthcare HMO plan is the only one they offer. However there are other companies like Blue Cross Blue Shield, Cigna, and Humana who offer Medicare Advantage plans in my county.
I found that Humana offers a PFFS plan in Fulton which may meet my needs but I will have to pay a premium for it. I am checking up on these things because I know that Nortel will eventually pull the plug and I don't want to be stuck and scrambling around when they do. I also want to continue going to the same primary care doctor since he knows me well, understands my heath history and has all my records.
So I advise everyone to check out what is available now in your own county so that you can be prepared when Nortel finally removes our medical benefit.
The one I received in Georgia was for a Medicare Advantage plan that was an HMO. It looked pretty good since there was no added premium and I could go to my primary doctor for a copay of $15 and my specialists for for a $40 copay. It even had an optional dental and vision rider that I could purchase.
Everything looked good until I checked with my primary care doctor and found that his practise did not accept this insurance. All my specialists were listed in the database but not him. It seems that this is quite common with many HMOs and it is really unfortunate since the primary care doctor is the one most seen by people. Maybe the copay is just too low. I checked on the United healthcare site and found that my doctor was in many of the other insurance plans they offer but not this one.
So I called the billing department of my doctor's office and they were very patient but explained to me that they just did not want to be involved in that type of insurance. They told me that however they did accept Medicare Advantage PFFS plans and perhaps I should look into that. (PFFS is Private Fee For Service)
So I looked at the booklet Medicare had sent out to me at the beginning of the year to see what Medicare advantage plans they offer. If you don't have the booklet you can look up the plans at the Medicare website. There are many different plans offered by a number of insurance companies including the same one that United Healthcare had sent out to us. There are also Medigap plans which are supplementary plans to basic Medicare which you can find by looking at the various insurance company sites. In my case I am more interested in the advantage plans so those are the ones I concentrated on.
Each plan is specific not only for the state you live in but also the county within that state. I found out that in Fulton County, Georgia, where I live, the United Healthcare HMO plan is the only one they offer. However there are other companies like Blue Cross Blue Shield, Cigna, and Humana who offer Medicare Advantage plans in my county.
I found that Humana offers a PFFS plan in Fulton which may meet my needs but I will have to pay a premium for it. I am checking up on these things because I know that Nortel will eventually pull the plug and I don't want to be stuck and scrambling around when they do. I also want to continue going to the same primary care doctor since he knows me well, understands my heath history and has all my records.
So I advise everyone to check out what is available now in your own county so that you can be prepared when Nortel finally removes our medical benefit.
Tuesday, July 27, 2010
Nortel Law Firm gets $76M so far in the court case
The following story was reported in "The AM Law Daily". You can read it and post your own comment at the following web site. My comment follows the article.
http://amlawdaily.typepad.com/amlawdaily/2010/07/cleary-nortel.html
July 15, 2010 6:22 PM
Cleary Killing It in Nortel BankruptcyPosted by Brian Baxter
Once one of the largest telecommunications companies in North America, Nortel Networks filed for bankruptcy in January 2009. Since then the Toronto-based company has helped its Chapter 11 counsel at Cleary Gottlieb Steen & Hamilton and several other firms earn a fortune in bankruptcy fees.
Earlier this week Nortel, which has spent the past 18 months selling off assets, filed a reorganization plan to repay creditors. Bloomberg reports the company has raised about $2.8 billion from asset sales, but has yet to detail how it plans to distribute those funds to creditors.
As noted in a recent feature story by sibling publication Corporate Counsel, breaking up what used to be one of Canada's largest companies has involved the efforts of hundreds of lawyers. And as lead debtor's counsel to Nortel, Cleary has been the beneficiary of much of that work.
A recent examination of bankruptcy court records by The Am Law Daily shows that the firm has billed Nortel for more than $76 million in fees and expenses from January 2009 through April of this year. James Bromley, the head of Cleary's global bankruptcy and restructuring practice, was named an Am Law Dealmaker of the Week last year for taking the lead advising Nortel on its asset sales. (Bromley did not respond to a request for comment.)
Bromley and fellow financial restructuring partner Lisa Schweitzer are billing $995 and $905 per hour, respectively, in leading a massive team from the firm working on Nortel's Chapter 11 case, according to bankruptcy court records. Over 300 Cleary timekeepers--more than 200 of them lawyers--have billed on the Nortel matter, according to a recent quarterly compensation request filed by the firm in the case.
According to the most recent Am Law 100 financial data, Cleary had gross revenues of $965 million last year. The firm also has 992 lawyers, according to the survey. That would mean about 21.5 percent of the firm's lawyers have worked on the Nortel case, and almost 6 percent of Cleary's gross revenues in 2009 would stem from Nortel-related billings (the firm's 2009 earnings from Nortel amount to $56.7 million).
Cleary has represented Nortel--whose most valuable remaining asset is a patent portfolio valued at roughly $1.1 billion--on the sale of key assets to Nokia, Ericsson, and Avaya, while helping the company overcome objections to some of those sales in bankruptcy litigation. But the firm is not the only one racking up the billables for Nortel.
Linklaters and Ogilvy Renault are serving as European and Canadian counsel to Nortel, respectively. Delaware's Morris, Nichols, Arsht & Tunnell is serving as local counsel to the company in its U.S. bankruptcy case. The debtor has also employed Crowell & Moring, Shearman & Sterling, and Jackson Lewis as special counsel.
Akin Gump Strauss Hauer & Feld, cocounsel to Nortel's official committee of unsecured creditors, has billed for more than $14.3 million in fees and expenses from January 2009 through April. Delaware's Richards, Layton & Finger has billed $685,192 for its work as cocounsel to the committee. Ashurst is serving as the committee's European counsel.
The mounting legal fees have not come without scrutiny. Late last month, Nortel sought to cut off health care and benefits to more than 4,000 former employees in the U.S. to save money, focusing attention on how much the company has been paying its advisers.
My Comment.
This is disgraceful! Disabled Nortel employees stand to lose all of their benefits at the end of this year while fat cat lawyers reap huge payouts from Nortel. Disabled employees may have their very lives shortened as a result of this action, but the lawyers will just move on to their next victims. In addition many thousands of Nortel pensioners will suffer tremendous cuts in pension payments, while the Government turns a blind eye and lets the lawyers feast on the carcase. Is this the New Canada?
http://amlawdaily.typepad.com/amlawdaily/2010/07/cleary-nortel.html
July 15, 2010 6:22 PM
Cleary Killing It in Nortel BankruptcyPosted by Brian Baxter
Once one of the largest telecommunications companies in North America, Nortel Networks filed for bankruptcy in January 2009. Since then the Toronto-based company has helped its Chapter 11 counsel at Cleary Gottlieb Steen & Hamilton and several other firms earn a fortune in bankruptcy fees.
Earlier this week Nortel, which has spent the past 18 months selling off assets, filed a reorganization plan to repay creditors. Bloomberg reports the company has raised about $2.8 billion from asset sales, but has yet to detail how it plans to distribute those funds to creditors.
As noted in a recent feature story by sibling publication Corporate Counsel, breaking up what used to be one of Canada's largest companies has involved the efforts of hundreds of lawyers. And as lead debtor's counsel to Nortel, Cleary has been the beneficiary of much of that work.
A recent examination of bankruptcy court records by The Am Law Daily shows that the firm has billed Nortel for more than $76 million in fees and expenses from January 2009 through April of this year. James Bromley, the head of Cleary's global bankruptcy and restructuring practice, was named an Am Law Dealmaker of the Week last year for taking the lead advising Nortel on its asset sales. (Bromley did not respond to a request for comment.)
Bromley and fellow financial restructuring partner Lisa Schweitzer are billing $995 and $905 per hour, respectively, in leading a massive team from the firm working on Nortel's Chapter 11 case, according to bankruptcy court records. Over 300 Cleary timekeepers--more than 200 of them lawyers--have billed on the Nortel matter, according to a recent quarterly compensation request filed by the firm in the case.
According to the most recent Am Law 100 financial data, Cleary had gross revenues of $965 million last year. The firm also has 992 lawyers, according to the survey. That would mean about 21.5 percent of the firm's lawyers have worked on the Nortel case, and almost 6 percent of Cleary's gross revenues in 2009 would stem from Nortel-related billings (the firm's 2009 earnings from Nortel amount to $56.7 million).
Cleary has represented Nortel--whose most valuable remaining asset is a patent portfolio valued at roughly $1.1 billion--on the sale of key assets to Nokia, Ericsson, and Avaya, while helping the company overcome objections to some of those sales in bankruptcy litigation. But the firm is not the only one racking up the billables for Nortel.
Linklaters and Ogilvy Renault are serving as European and Canadian counsel to Nortel, respectively. Delaware's Morris, Nichols, Arsht & Tunnell is serving as local counsel to the company in its U.S. bankruptcy case. The debtor has also employed Crowell & Moring, Shearman & Sterling, and Jackson Lewis as special counsel.
Akin Gump Strauss Hauer & Feld, cocounsel to Nortel's official committee of unsecured creditors, has billed for more than $14.3 million in fees and expenses from January 2009 through April. Delaware's Richards, Layton & Finger has billed $685,192 for its work as cocounsel to the committee. Ashurst is serving as the committee's European counsel.
The mounting legal fees have not come without scrutiny. Late last month, Nortel sought to cut off health care and benefits to more than 4,000 former employees in the U.S. to save money, focusing attention on how much the company has been paying its advisers.
My Comment.
This is disgraceful! Disabled Nortel employees stand to lose all of their benefits at the end of this year while fat cat lawyers reap huge payouts from Nortel. Disabled employees may have their very lives shortened as a result of this action, but the lawyers will just move on to their next victims. In addition many thousands of Nortel pensioners will suffer tremendous cuts in pension payments, while the Government turns a blind eye and lets the lawyers feast on the carcase. Is this the New Canada?
Monday, July 26, 2010
Canadian Old Age Security pension
In addition to CPP or QPP Canadians can apply for the old age security pension when they reach 65. There are some rules regarding the pension that you should look into.
You can find the information at:
http://www.servicecanada.gc.ca/eng/isp/pub/oas/oas.shtml
The rules are:
Scenario 1 - People living in Canada
You must be 65 years of age or older.
You must live in Canada and be a Canadian citizen or a legal resident at the time we approve your pension application.
You must have lived in Canada for at least 10 years after turning 18.
Scenario 2 - People living outside Canada
You must be 65 years of age or older.
You must have been a Canadian citizen or a legal resident of Canada the day before you left Canada.
You must have lived in Canada for at least 20 years after turning 18.
If you are not covered by either of these two scenarios, you may still qualify for a pension since Canada has social security agreements with many countries. If you have lived in one of these countries or contributed to its social security system, you may qualify for a pension from that country, from Canada or from both countries.
Canada and the US have a treaty which allows for totalization of years worked in both countries. You may be able to use that to obtain the OAS. contact them directly at 1-800-277-9914 (English), or for service in French: 1-800-277-9915.
There is also a clause in the OAS pension called clawback which affects people who have more than $66k income (including the OAS payment) are subject to the clawback. However the clawback may not apply to people who live in the US. The rules are stated:
How do I know if the recovery tax applies to me?
You must pay the recovery tax if:
your annual net world income is more than $66,335 (for 2009, in Canadian dollars); and you live in a country where the non-resident tax on Canadian pensions is 25 percent.
Since the US has a tax treaty with Canada the non-residence tax is 15%.
You can find the information at:
http://www.servicecanada.gc.ca/eng/isp/pub/oas/oas.shtml
The rules are:
Scenario 1 - People living in Canada
You must be 65 years of age or older.
You must live in Canada and be a Canadian citizen or a legal resident at the time we approve your pension application.
You must have lived in Canada for at least 10 years after turning 18.
Scenario 2 - People living outside Canada
You must be 65 years of age or older.
You must have been a Canadian citizen or a legal resident of Canada the day before you left Canada.
You must have lived in Canada for at least 20 years after turning 18.
If you are not covered by either of these two scenarios, you may still qualify for a pension since Canada has social security agreements with many countries. If you have lived in one of these countries or contributed to its social security system, you may qualify for a pension from that country, from Canada or from both countries.
Canada and the US have a treaty which allows for totalization of years worked in both countries. You may be able to use that to obtain the OAS. contact them directly at 1-800-277-9914 (English), or for service in French: 1-800-277-9915.
There is also a clause in the OAS pension called clawback which affects people who have more than $66k income (including the OAS payment) are subject to the clawback. However the clawback may not apply to people who live in the US. The rules are stated:
How do I know if the recovery tax applies to me?
You must pay the recovery tax if:
your annual net world income is more than $66,335 (for 2009, in Canadian dollars); and you live in a country where the non-resident tax on Canadian pensions is 25 percent.
Since the US has a tax treaty with Canada the non-residence tax is 15%.
Friday, July 23, 2010
US Social Security Windfall Elimination Provision
For retirees living in the USA and receiving social security as well as a government pension from another country such as Canada, there is a reduction in the amount of social security resulting from a painful law that cuts social security up to half of the amount received from the other pension.
A similar cut due to a law called the Government Pension Offset, is also made on a spouse's social security if the spouse is receiving another government pension, and in this case the reduction can be up to two thirds of the secondary pension amount.
After working for many years in Canada the logic of the WEP and GPO doesn't seem fair to me since I paid into the Canadian pension system and it can mean a large reduction in my social security and also on my spouse's social security. At a time when we already have lost some of our US pension, are about to get clobbered by the Nortel Canadian pension reduction, and also lose our medical benefits, the WEP and GPO are like pouring salt on open wounds.
There have been a number of attempts to have the WEP and GPO repealed but so far it hasn't gone anywhere. There are about one million retirees out of 49 million who are subject to this reduction so I suppose the numbers aren't high enough to really get the politicians' attention. Even the AARP is neutral on the WEP and GPO.
If the WEP and GPO were repealed it would be an extra cost to social security which would shorten the life of the trust fund by about one year, but given all the current issues the trust fund is facing that seems to be the least of it's worries at this point.
I plan to write to the president, various senators, and congressmen urging them to repeal these laws and I hope those of you who are also affected by them will do the same.
A similar cut due to a law called the Government Pension Offset, is also made on a spouse's social security if the spouse is receiving another government pension, and in this case the reduction can be up to two thirds of the secondary pension amount.
After working for many years in Canada the logic of the WEP and GPO doesn't seem fair to me since I paid into the Canadian pension system and it can mean a large reduction in my social security and also on my spouse's social security. At a time when we already have lost some of our US pension, are about to get clobbered by the Nortel Canadian pension reduction, and also lose our medical benefits, the WEP and GPO are like pouring salt on open wounds.
There have been a number of attempts to have the WEP and GPO repealed but so far it hasn't gone anywhere. There are about one million retirees out of 49 million who are subject to this reduction so I suppose the numbers aren't high enough to really get the politicians' attention. Even the AARP is neutral on the WEP and GPO.
If the WEP and GPO were repealed it would be an extra cost to social security which would shorten the life of the trust fund by about one year, but given all the current issues the trust fund is facing that seems to be the least of it's worries at this point.
I plan to write to the president, various senators, and congressmen urging them to repeal these laws and I hope those of you who are also affected by them will do the same.
Thursday, July 22, 2010
VEBA hearing rescheduled to August 18th
The hearing of the NUSRPC motion for formation of a VEBA, has been rescheduled by the US bankruptcy court to August 18th 2010. The information is contained in docket 3722 on the Epiq web site.
Ottawa Citizen Article- a view from Canada
The following article appeared in the Ottawa Citizen yesterday. There are a few comments that don't tell the whole story on such things as the PBGC pension payments, and the 80% tax credit, but overall it gives a summary of the different approaches in the USA and Canada, to pensioners whose companies go bankrupt.
Nortel's Canadian, U.S. creditors face different experiences
By Bert Hill, The Ottawa Citizen July 21, 2010
Canadian courts have proved to be a friend of Nortel Networks in fending off bids by pensioners for a bigger piece of $7 billion in assets in the collapse of the one-time giant. But the U.S. courts are proving a tougher nut to crack, forcing Nortel to revise its strategy in order to wriggle out of previous obligations.
The U.S. Court of Appeal has just put a big roadblock in Nortel plans to cut off drug, dental, eye care and life insurance coverage of 4,000 Nortel pensioners and the income support of 280 long-term disability recipients as soon as the end of August. As a result of a decision July 13 in a related case, Nortel now must negotiate with the vulnerable groups before it modifies their benefit coverage.
The decision means that it will likely have to pay $2 million monthly in benefits for several more months. Nortel had thrown gasoline on the fire in late June by declaring that the benefits must go because the group now provides no benefit to the company but former U.S. pensioners flooded the court with more than 330 pleas in less than three weeks.
The pensioner backlash was a remarkable change of mood by the previously passive groups.
Because U.S. pension plan guarantees and social security benefits are significantly stronger than in most Canadian jurisdictions, the U.S. employees did not hire lawyers to fight their case early on. Another factor was the high cost of U.S. litigation.
In Canada, the Nortel pensioners and related groups were much more aggressive because they had to be.
The social safety network in bankruptcies is full of holes. The federal government, including all Ottawa Conservative MPs, is quite happy to cite Nortel as an example of the need for reform in conjunction with provincial changes -- but is not actually to do anything now. The cabinet and most backbenchers voted against bankruptcy law changes which got approval in principle recently.
The Canadian pensioners earlier this year were successful in negotiating an extension of medical and life insurance as well as income protection for long-term disability recipients to the end of December.
But they paid a heavy price: giving up the right to sue Nortel directors and officers for underfunded health and welfare plans. They also had to effectively drop hopes to benefit from changes to bankruptcy legislation still kicking around Parliament Hill, though the dream lives on.
The blunt Nortel plan inflamed the U.S. group. They were given just 15 days to register complaints and another 10 days to prepare for a court hearing.
Lynette Seymour, a disability recipient in Austin, Texas, told the court she got her first warning four days after the deadline for complaining.
While the vast volume of the complaints show the signs of a well-organized campaign -- they now have lawyers and a pensioner protection committee -- they also speak forcibly to the dilemmas that many Canadian Nortel people are also facing. Many were not aware that their benefits were in danger, believing that they were protected despite the bankruptcy proceedings. Canadian Nortel pension leaders say they continue to discover people, some very elderly, who also thought the benefits were guaranteed.
The U.S. trustee, an independent umpire in bankruptcy proceedings, urged the court to ignore Nortel claims that it cannot afford the cost of the benefits. It said Nortel was "granted authority to pay in excess of $50 million to members of senior management and now claim they are unable to afford $2 million per month for the cost of these plans.''
The U.S. groups slammed Nortel for treating their Canadian counterparts better. Pensioners in Texas, North Carolina, West Virginia, Florida and California say they are being double disadvantaged. Not only could the Canadians get coverage for up to four months longer, but the money will also come from U.S. Nortel operations and reduce their eventual share of claims against U.S. assets.
The complaint is true as far as it goes. But it does not reflect other factors like the huge $3 billion U.S. tax claim against modest Canadian assets which will hit all Canadians claimants. The U.S. pensioners also have some real benefits that Canadians can only dream about. Many are already receiving pension benefit protection of up $60,000 annually from a U.S. pension benefit guarantee corporation. Canadian pensioners who worked in Ontario will get only the first $12,000 of annual benefits protected and others who worked elsewhere will get nothing.
The Ontario group is also working feverishly with the provincial government to take over the under-funded plan in October to avoid an immediate sharp reduction to their benefits. The Quebec government has promised similar action but it is unclear whether Nortel pensioners who worked in other provinces will be as lucky. The 400 Canadian long-term disability recipients appear headed for huge cuts to average annual income support payments of $30,000 as well as to their medical benefits coverage.
The Canada Pension Plan disability and provincial emergency drug benefit plans will take big hits. The U.S Nortel pensioners also get immediate benefits that Canadians do not. They will get 80 per cent of their life and medical benefits premiums covered by a U.S. tax credit, a big help in finding affordable coverage. The U.S. pensioner protection committee says they believe they can find new private coverage by December.
Nortel's Canadian, U.S. creditors face different experiences
By Bert Hill, The Ottawa Citizen July 21, 2010
Canadian courts have proved to be a friend of Nortel Networks in fending off bids by pensioners for a bigger piece of $7 billion in assets in the collapse of the one-time giant. But the U.S. courts are proving a tougher nut to crack, forcing Nortel to revise its strategy in order to wriggle out of previous obligations.
The U.S. Court of Appeal has just put a big roadblock in Nortel plans to cut off drug, dental, eye care and life insurance coverage of 4,000 Nortel pensioners and the income support of 280 long-term disability recipients as soon as the end of August. As a result of a decision July 13 in a related case, Nortel now must negotiate with the vulnerable groups before it modifies their benefit coverage.
The decision means that it will likely have to pay $2 million monthly in benefits for several more months. Nortel had thrown gasoline on the fire in late June by declaring that the benefits must go because the group now provides no benefit to the company but former U.S. pensioners flooded the court with more than 330 pleas in less than three weeks.
The pensioner backlash was a remarkable change of mood by the previously passive groups.
Because U.S. pension plan guarantees and social security benefits are significantly stronger than in most Canadian jurisdictions, the U.S. employees did not hire lawyers to fight their case early on. Another factor was the high cost of U.S. litigation.
In Canada, the Nortel pensioners and related groups were much more aggressive because they had to be.
The social safety network in bankruptcies is full of holes. The federal government, including all Ottawa Conservative MPs, is quite happy to cite Nortel as an example of the need for reform in conjunction with provincial changes -- but is not actually to do anything now. The cabinet and most backbenchers voted against bankruptcy law changes which got approval in principle recently.
The Canadian pensioners earlier this year were successful in negotiating an extension of medical and life insurance as well as income protection for long-term disability recipients to the end of December.
But they paid a heavy price: giving up the right to sue Nortel directors and officers for underfunded health and welfare plans. They also had to effectively drop hopes to benefit from changes to bankruptcy legislation still kicking around Parliament Hill, though the dream lives on.
The blunt Nortel plan inflamed the U.S. group. They were given just 15 days to register complaints and another 10 days to prepare for a court hearing.
Lynette Seymour, a disability recipient in Austin, Texas, told the court she got her first warning four days after the deadline for complaining.
While the vast volume of the complaints show the signs of a well-organized campaign -- they now have lawyers and a pensioner protection committee -- they also speak forcibly to the dilemmas that many Canadian Nortel people are also facing. Many were not aware that their benefits were in danger, believing that they were protected despite the bankruptcy proceedings. Canadian Nortel pension leaders say they continue to discover people, some very elderly, who also thought the benefits were guaranteed.
The U.S. trustee, an independent umpire in bankruptcy proceedings, urged the court to ignore Nortel claims that it cannot afford the cost of the benefits. It said Nortel was "granted authority to pay in excess of $50 million to members of senior management and now claim they are unable to afford $2 million per month for the cost of these plans.''
The U.S. groups slammed Nortel for treating their Canadian counterparts better. Pensioners in Texas, North Carolina, West Virginia, Florida and California say they are being double disadvantaged. Not only could the Canadians get coverage for up to four months longer, but the money will also come from U.S. Nortel operations and reduce their eventual share of claims against U.S. assets.
The complaint is true as far as it goes. But it does not reflect other factors like the huge $3 billion U.S. tax claim against modest Canadian assets which will hit all Canadians claimants. The U.S. pensioners also have some real benefits that Canadians can only dream about. Many are already receiving pension benefit protection of up $60,000 annually from a U.S. pension benefit guarantee corporation. Canadian pensioners who worked in Ontario will get only the first $12,000 of annual benefits protected and others who worked elsewhere will get nothing.
The Ontario group is also working feverishly with the provincial government to take over the under-funded plan in October to avoid an immediate sharp reduction to their benefits. The Quebec government has promised similar action but it is unclear whether Nortel pensioners who worked in other provinces will be as lucky. The 400 Canadian long-term disability recipients appear headed for huge cuts to average annual income support payments of $30,000 as well as to their medical benefits coverage.
The Canada Pension Plan disability and provincial emergency drug benefit plans will take big hits. The U.S Nortel pensioners also get immediate benefits that Canadians do not. They will get 80 per cent of their life and medical benefits premiums covered by a U.S. tax credit, a big help in finding affordable coverage. The U.S. pensioner protection committee says they believe they can find new private coverage by December.
Wednesday, July 21, 2010
Foreign earnings impact on Canadian pensions - Update
A more detailed status report on the impact of foreign earnings on Canadian pensions from Nortel was posted on the Koskie Minsky Site on July 15, 2010. The conclusion is good news, for a change, for those of us with foreign service earnings included in our Canada pension calculations.
As stated on the K.M. site:
Over the past several months, the Canada Revenue Agency ("CRA") has been reviewing Nortel's practice for the calculation of individuals' pensions that include a foreign service earnings component. As a result of this issue, some pension plan members who have foreign earnings and who recently became retirement eligible have experienced process delays and/or have been receiving reduced monthly pensions or transfers based on pension calculations that exclude foreign service earnings.
The CRA recently completed its review and has concluded that Nortel's historical practice of including foreign service earnings as eligible earnings for the purposes of pension benefits is acceptable. The CRA will continue to permit the calculation of pensions in accordance with this practice. Going forward, it is clear that plan members in receipt of monthly pensions that include foreign service earnings will experience no change to their monthly pension payments. For those individuals who have experienced delays and/or reduced pensions, these issues have now been resolved. Mercer will immediately begin to recalculate affected pensions, however, it may take six to eight weeks to complete most of the recalculations and to implement the appropriate payments and transfers.
Individuals who have already received and submitted an option statement to Mercer will now have their pensions calculated with the inclusion of foreign service earnings. If you have experienced a temporary reduction in your monthly pension or transfer amount based on a calculation that excludes foreign service earnings, you will receive either a lump sum top-up payment or additional transfer amount, as applicable, to compensate you for that reduction. If you received an option statement from Mercer in the past, but have not yet completed your form, please proceed to submit your option statement to Mercer and your pension and/or commuted value entitlement will be calculated with the inclusion of your foreign service earnings. Please contact Mercer with questions that are specific to these issues.
Please note that the CRA continues to review tax issues related to Pension Adjustment Reversals and tax on cash payments of the commuted value of registered pensions. We will advise once this review is complete and a conclusion has been reached by the CRA.
As stated on the K.M. site:
Over the past several months, the Canada Revenue Agency ("CRA") has been reviewing Nortel's practice for the calculation of individuals' pensions that include a foreign service earnings component. As a result of this issue, some pension plan members who have foreign earnings and who recently became retirement eligible have experienced process delays and/or have been receiving reduced monthly pensions or transfers based on pension calculations that exclude foreign service earnings.
The CRA recently completed its review and has concluded that Nortel's historical practice of including foreign service earnings as eligible earnings for the purposes of pension benefits is acceptable. The CRA will continue to permit the calculation of pensions in accordance with this practice. Going forward, it is clear that plan members in receipt of monthly pensions that include foreign service earnings will experience no change to their monthly pension payments. For those individuals who have experienced delays and/or reduced pensions, these issues have now been resolved. Mercer will immediately begin to recalculate affected pensions, however, it may take six to eight weeks to complete most of the recalculations and to implement the appropriate payments and transfers.
Individuals who have already received and submitted an option statement to Mercer will now have their pensions calculated with the inclusion of foreign service earnings. If you have experienced a temporary reduction in your monthly pension or transfer amount based on a calculation that excludes foreign service earnings, you will receive either a lump sum top-up payment or additional transfer amount, as applicable, to compensate you for that reduction. If you received an option statement from Mercer in the past, but have not yet completed your form, please proceed to submit your option statement to Mercer and your pension and/or commuted value entitlement will be calculated with the inclusion of your foreign service earnings. Please contact Mercer with questions that are specific to these issues.
Please note that the CRA continues to review tax issues related to Pension Adjustment Reversals and tax on cash payments of the commuted value of registered pensions. We will advise once this review is complete and a conclusion has been reached by the CRA.
US Medical benefits-United Healthcare plans cancelled
Before Nortel withdrew its motion to terminate benefits they sent out a package regarding an agreement with United Healthcare. There were supposed to be meetings and conference calls to review the plans offered by UHC.
Since Nortel has withdrawn their motion all of those plans have been cancelled. I spoke to UHC this morning and they advised me that the coverage from Nortel will continue as it was for some unknown time.
Nortel indicated that they reserve the right to re submit so there is no doubt that in the near future our US medical benefits will once again be in jeopardy. In the meantime it would be a good idea to continue looking around for alternative coverage.
Since Nortel has withdrawn their motion all of those plans have been cancelled. I spoke to UHC this morning and they advised me that the coverage from Nortel will continue as it was for some unknown time.
Nortel indicated that they reserve the right to re submit so there is no doubt that in the near future our US medical benefits will once again be in jeopardy. In the meantime it would be a good idea to continue looking around for alternative coverage.
Tuesday, July 20, 2010
Disinformation spread by Canadian lobbyists
The NRPC has put together a leaflet on their web site that gives the NRPC view on specific topics, where lobbyists have been active in poisoning the thinking of MPs and the Canadian public in general. I have copied the information and displayed it below with some of my own editing shown in italics. The NRPC calls these items lies and believes that it has answered them with the real truth, and urges you to include the facts in your letters and emails to elected officials and the media.
Again I would remind you that this blog is not connected with, or part of,either the NRPC or the NUSRPC, it is solely my opinion and I am just providing this material for your information.
# 1:
Many countries don’t give preferred status to pension plan deficits so Canada should not.
The facts:
Many countries, like the USA and UK, have guaranteed pension replacement in bankruptcy or insist that pension plans be fully funded, like the Netherlands. They don’t need to give pensioners preferred status in a bankruptcy. Many Nortel pensioners in the US and UK, (who meet specific requirements of the government funded programs), are getting virtually their full pensions. In the absence of such programs in Canada, preferred status for pensioners and employees is the best alternative right now.
# 2:
Giving pensioners and employees preferred status will discourage investors from lending money to distressed companies and will cause more bankruptcies
The facts
There is a major section of the capital markets that specializes in lending to distressed companies. They are called junk-bond lenders. They charge high interest rates depending on the credit rating of the borrower. The also use Credit Default Swaps (CDS) to insure their loans. They will continue to lend but may charge slightly more to companies with significantly under-funded employee plans. Also their CDS insurance combined with Canada’s weak bankruptcy laws allows them to make a profit by double-dipping in the bankruptcy process. It is the CDS problem that is distorting the Canadian bankruptcy system and may create more bankruptcies.
# 3:
The Canadian government has already made changes to pension and bankruptcy laws.
The facts:
Canada’s pension and bankruptcy laws are fractured across the federal and provincial scene. The federal changes to date apply to only about 7% of private sector pension plans. Even so they do not provide for pension guarantees or enforce full funding of pension plans. They do not address the critical issues of employee related claims for pension plan deficits, health care, disability benefits and life insurance in the
bankruptcy court.
# 4:
Giving preferred status to employee and pensioner claims will hurt small investors and pension funds.
The facts:
Neither pension funds nor small investors typically put or keep their money in the below investment grade bonds of companies that are at risk of bankruptcy. That territory is the preserve of the junk-bond lender.
# 5:
Giving preferred status to employee and pensioner claims will cause companies to stop offering defined-benefit pension plans.
The facts:
Lobbyists claim (on the one hand) that private-sector defined benefit plans are a valuable part of today's retirement savings regime and are good for Canadian workers. Yet(on the other hand) they also want CEOs to retain the right to renege on a company’s promises to employees and pensioners. (The NRPC view is that); Companies that want to build and retain a world-class workforce will offer defined benefit pension plans and will fund them properly. Sweden is an example of an advanced country that provides protection to retirees and has retained a predominance of defined benefit pension plans within a healthy economy.
Again I would remind you that this blog is not connected with, or part of,either the NRPC or the NUSRPC, it is solely my opinion and I am just providing this material for your information.
# 1:
Many countries don’t give preferred status to pension plan deficits so Canada should not.
The facts:
Many countries, like the USA and UK, have guaranteed pension replacement in bankruptcy or insist that pension plans be fully funded, like the Netherlands. They don’t need to give pensioners preferred status in a bankruptcy. Many Nortel pensioners in the US and UK, (who meet specific requirements of the government funded programs), are getting virtually their full pensions. In the absence of such programs in Canada, preferred status for pensioners and employees is the best alternative right now.
# 2:
Giving pensioners and employees preferred status will discourage investors from lending money to distressed companies and will cause more bankruptcies
The facts
There is a major section of the capital markets that specializes in lending to distressed companies. They are called junk-bond lenders. They charge high interest rates depending on the credit rating of the borrower. The also use Credit Default Swaps (CDS) to insure their loans. They will continue to lend but may charge slightly more to companies with significantly under-funded employee plans. Also their CDS insurance combined with Canada’s weak bankruptcy laws allows them to make a profit by double-dipping in the bankruptcy process. It is the CDS problem that is distorting the Canadian bankruptcy system and may create more bankruptcies.
# 3:
The Canadian government has already made changes to pension and bankruptcy laws.
The facts:
Canada’s pension and bankruptcy laws are fractured across the federal and provincial scene. The federal changes to date apply to only about 7% of private sector pension plans. Even so they do not provide for pension guarantees or enforce full funding of pension plans. They do not address the critical issues of employee related claims for pension plan deficits, health care, disability benefits and life insurance in the
bankruptcy court.
# 4:
Giving preferred status to employee and pensioner claims will hurt small investors and pension funds.
The facts:
Neither pension funds nor small investors typically put or keep their money in the below investment grade bonds of companies that are at risk of bankruptcy. That territory is the preserve of the junk-bond lender.
# 5:
Giving preferred status to employee and pensioner claims will cause companies to stop offering defined-benefit pension plans.
The facts:
Lobbyists claim (on the one hand) that private-sector defined benefit plans are a valuable part of today's retirement savings regime and are good for Canadian workers. Yet(on the other hand) they also want CEOs to retain the right to renege on a company’s promises to employees and pensioners. (The NRPC view is that); Companies that want to build and retain a world-class workforce will offer defined benefit pension plans and will fund them properly. Sweden is an example of an advanced country that provides protection to retirees and has retained a predominance of defined benefit pension plans within a healthy economy.
Monday, July 19, 2010
Nortel US Medical Benefits conference calls
In the original mailed announcement by Nortel that they were terminating medical benefits, they stated that there would be conference calls with United Healthcare on specific dates for to give retirees more information about the UHC plans.
With Nortel's recent withdrawal of the court motion to terminate the benefits I am not sure what that will do to their plan. However the conference calls may give us some more information as to what is happening.
The calls are scheduled for July21, July24, and August 4 and the number is 1-800-260-0702. For retirees over 65, the calls will be at 10:00am Central Daylight Time. For retirees under 65 the calls will be at 1:00pm CDT. The access code is 161018# Remember the calls are scheduled on Central Daylight Time so check to make sure what the time is on your time zone.
With Nortel's recent withdrawal of the court motion to terminate the benefits I am not sure what that will do to their plan. However the conference calls may give us some more information as to what is happening.
The calls are scheduled for July21, July24, and August 4 and the number is 1-800-260-0702. For retirees over 65, the calls will be at 10:00am Central Daylight Time. For retirees under 65 the calls will be at 1:00pm CDT. The access code is 161018# Remember the calls are scheduled on Central Daylight Time so check to make sure what the time is on your time zone.
Sunday, July 18, 2010
Canada update from the NRPC
The NRPC emailed a newsletter last week to it's membership. Members can check it out on the NRPC link on the right hand column. For those of you who aren't members of the Canadian NRPC I have included a few of the highlights that might impact you. The following notes are my interpretation of the newsletter and are not specific statements by the NRPC.
1.Annual General Meeting
The Annual General Meeting of the NRPC will be held August 24th This will be a procedural meeting only so don't expect to get answers on pensions etc. there. Members will be able to vote at the meeting or by proxy.
2. Terminated employees.
The $3K for terminated employees should start appearing in July and should be completed by the end of August. The NRPC is working with the Canadian Revenue Agency on an interim PAR ( Pension Adjustment Reversal) which would help from a tax perspective and give some income while the pension plan wind up gets sorted out. They are also trying to obtain a more favorable application of the LIRA transfer limit.
3. Webinars
Two webinars will be held before the end of September.
4. Ontario pension top up.
The top up will apply to people who worked in Ontario all or part of their career at Nortel. Your current location or residence does not factor into the calculation. Only your service. The top up applies only to the first $1000 per month, of your pension you earned in Ontario. For those of you with less than 100% of your pension from Nortel service in Ontario, the calculation will determine a percentage based on the years of service in Ontario compared to total Nortel service. ( I am not clear on whether this means total Nortel service worldwide, or Nortel service Canada.)
To determine the top up, first work out the amount of your monthly pension related to service in Ontario. (Multiply your monthly pension by the percentage of your total Nortel service that came from service in Ontario.) If that amount if more than $1000, it has to be capped at $1000 since the top up is limited to $1000.
Multiply the Ontario pension amount (up to $1000) by the trust fund factor at wind up. This may be 70%, or 60% or less depending on the wind up ratio.
Subtract that number from the Ontario pension (maximum $1000) that you determined in the first step. That difference will be paid to you by the Ontario government to bring you back to the total Ontario pension (maximum $1000) you worked out in the first step.
For example lets say your monthly pension is $2,000.
You worked a total of 30 years at Nortel.
You worked 12 years in Ontario and 18 years in some other province.
You percentage Ontario pension ratio is 12/30 = 0.4 (or 40%).
You eligible Ontario pension for top up is $2000 time 0.4 = $800.
The rest of your pension, $1200, is paid from the trust fund at the wind up ratio.
The wind up pension factor is 0.60 (60%)
Your Ontario pension $800 times the wind up factor 0.6 is $480.
The top up is therefore $800 minus $480, or $320.
So Ontario will pay you $320. The trust fund will pay you $480 for the Ontario portion, and the trust fund will pay $1200 times the wind up factor 0.6 = $720 from the rest of your pension for a total of $1520.
5. Quebec Law One
This will apply to people who retired from Quebec.
It has 3 options. Take the pension as an annuity right now. Take a lump sum payment and transfer it into a LIF. Transfer the pension into the RRQ and start taking an annuity payment. The last option is basically an attempt to protect your pension value to let it grow over 5 years and take advantage of better annuity rates at a later date.
6. Health Coverage Replacement (Canada)
The NRPC is working with Canadian Insurance companies to work out a replacement plan after December 2010 when the current plan ends. At this time there is no definitive result to report. Future newsletters will provide more details on the exact status and action on health coverage as well as life insurance for Canadian retirees.
7. Political Front
House Bill C-501 has been referred to the Industry committee. There is conservative opposition to it. It will need a lot of public support to change their minds and take it further. Letter writing and discussions are ongoing and pressure on the MPs continues, with Ads taken out in major newspapers.
Bill S-214 in the Senate is being pushed by the liberal senators. It has not yet reached a committee. The NRPC has requested both the Senate and the House to make a presentation on the impact and need for passage of these bills.
8. Communications
Their are now 180 letter warriors sending letters to the media and the elected officials. The volume of letters and emails has helped educate many MPS and Senators as well as the public on the real impact of company bankruptcy on pensioners. More letter writers are always welcome. Check the NRPC website for details as to how to assist.
A group has been set up inside the NRPC to help publish electronic newsletters on a more regular basis. These communications are extremely important as we near the date at which Nortel ceases to administer the Canadian pension, (Sept 30th), and terminates the health and LTD benefits. (Dec 31st).
9.Financial Sponsorship
The NRPC is working with the Ontario Ministry of Finance to change regulations so that a Financial Institution could take over running the Nortel Pension Plan instead of winding it up and purchasing annuities. These discussions cannot be made public yet, but the NRPC's goal is to avoid conversion to annuities which would further reduce the trust Fund payout ratio.
1.Annual General Meeting
The Annual General Meeting of the NRPC will be held August 24th This will be a procedural meeting only so don't expect to get answers on pensions etc. there. Members will be able to vote at the meeting or by proxy.
2. Terminated employees.
The $3K for terminated employees should start appearing in July and should be completed by the end of August. The NRPC is working with the Canadian Revenue Agency on an interim PAR ( Pension Adjustment Reversal) which would help from a tax perspective and give some income while the pension plan wind up gets sorted out. They are also trying to obtain a more favorable application of the LIRA transfer limit.
3. Webinars
Two webinars will be held before the end of September.
4. Ontario pension top up.
The top up will apply to people who worked in Ontario all or part of their career at Nortel. Your current location or residence does not factor into the calculation. Only your service. The top up applies only to the first $1000 per month, of your pension you earned in Ontario. For those of you with less than 100% of your pension from Nortel service in Ontario, the calculation will determine a percentage based on the years of service in Ontario compared to total Nortel service. ( I am not clear on whether this means total Nortel service worldwide, or Nortel service Canada.)
To determine the top up, first work out the amount of your monthly pension related to service in Ontario. (Multiply your monthly pension by the percentage of your total Nortel service that came from service in Ontario.) If that amount if more than $1000, it has to be capped at $1000 since the top up is limited to $1000.
Multiply the Ontario pension amount (up to $1000) by the trust fund factor at wind up. This may be 70%, or 60% or less depending on the wind up ratio.
Subtract that number from the Ontario pension (maximum $1000) that you determined in the first step. That difference will be paid to you by the Ontario government to bring you back to the total Ontario pension (maximum $1000) you worked out in the first step.
For example lets say your monthly pension is $2,000.
You worked a total of 30 years at Nortel.
You worked 12 years in Ontario and 18 years in some other province.
You percentage Ontario pension ratio is 12/30 = 0.4 (or 40%).
You eligible Ontario pension for top up is $2000 time 0.4 = $800.
The rest of your pension, $1200, is paid from the trust fund at the wind up ratio.
The wind up pension factor is 0.60 (60%)
Your Ontario pension $800 times the wind up factor 0.6 is $480.
The top up is therefore $800 minus $480, or $320.
So Ontario will pay you $320. The trust fund will pay you $480 for the Ontario portion, and the trust fund will pay $1200 times the wind up factor 0.6 = $720 from the rest of your pension for a total of $1520.
5. Quebec Law One
This will apply to people who retired from Quebec.
It has 3 options. Take the pension as an annuity right now. Take a lump sum payment and transfer it into a LIF. Transfer the pension into the RRQ and start taking an annuity payment. The last option is basically an attempt to protect your pension value to let it grow over 5 years and take advantage of better annuity rates at a later date.
6. Health Coverage Replacement (Canada)
The NRPC is working with Canadian Insurance companies to work out a replacement plan after December 2010 when the current plan ends. At this time there is no definitive result to report. Future newsletters will provide more details on the exact status and action on health coverage as well as life insurance for Canadian retirees.
7. Political Front
House Bill C-501 has been referred to the Industry committee. There is conservative opposition to it. It will need a lot of public support to change their minds and take it further. Letter writing and discussions are ongoing and pressure on the MPs continues, with Ads taken out in major newspapers.
Bill S-214 in the Senate is being pushed by the liberal senators. It has not yet reached a committee. The NRPC has requested both the Senate and the House to make a presentation on the impact and need for passage of these bills.
8. Communications
Their are now 180 letter warriors sending letters to the media and the elected officials. The volume of letters and emails has helped educate many MPS and Senators as well as the public on the real impact of company bankruptcy on pensioners. More letter writers are always welcome. Check the NRPC website for details as to how to assist.
A group has been set up inside the NRPC to help publish electronic newsletters on a more regular basis. These communications are extremely important as we near the date at which Nortel ceases to administer the Canadian pension, (Sept 30th), and terminates the health and LTD benefits. (Dec 31st).
9.Financial Sponsorship
The NRPC is working with the Ontario Ministry of Finance to change regulations so that a Financial Institution could take over running the Nortel Pension Plan instead of winding it up and purchasing annuities. These discussions cannot be made public yet, but the NRPC's goal is to avoid conversion to annuities which would further reduce the trust Fund payout ratio.
Saturday, July 17, 2010
NUSRPC files a motion in court to form a Voluntary Employee Beneficiary Association
Following the withdrawal of the Nortel motion to terminate medical and LTD benefits, the NUSRPC (Nortel US Retirees protection Committee) filed a motion in Bankruptcy Court to establish a Voluntary Employee Beneficiary Association under section 501 (c)(9) of the Internal Revenue Code.
It appears that the Third Circuit Court of Appeals rendered a decision on July 13,2010 against an appeal by Visteon. The decision means that the Bankruptcy Code Section 1114 protects even benefits (medical and LTD for example) that a debtor reserved the right to modify out side bankruptcy. Hence Nortel's argument in their original motion is now null and void.
The motion by the NUSRPC calls for the formation of a VEBA which would take advantage of the Health Coverage tax credit (HTCT) which is a 80% federal subsidy. This subsidy applies to retirees and spouses 55 and older who are receiving pensions from the PBGC and pays 80% of the cost of health insurance and prescription drug programs. The HTCT is limited to those under 65, and to spouses and dependents of a retiree who is under 67. It also only applies to those receiving pensions from the PBGC.
Hopefully the NUSRPC will issue a comment shortly on all these developments.
So with all this happening it may mean that the Nortel benefits will have to continue after August, but I don't know yet.
It appears that the Third Circuit Court of Appeals rendered a decision on July 13,2010 against an appeal by Visteon. The decision means that the Bankruptcy Code Section 1114 protects even benefits (medical and LTD for example) that a debtor reserved the right to modify out side bankruptcy. Hence Nortel's argument in their original motion is now null and void.
The motion by the NUSRPC calls for the formation of a VEBA which would take advantage of the Health Coverage tax credit (HTCT) which is a 80% federal subsidy. This subsidy applies to retirees and spouses 55 and older who are receiving pensions from the PBGC and pays 80% of the cost of health insurance and prescription drug programs. The HTCT is limited to those under 65, and to spouses and dependents of a retiree who is under 67. It also only applies to those receiving pensions from the PBGC.
Hopefully the NUSRPC will issue a comment shortly on all these developments.
So with all this happening it may mean that the Nortel benefits will have to continue after August, but I don't know yet.
Friday, July 16, 2010
Nortel US withdraws their motion to terminate medical and LTD benefits
Docket 3651 filed today in the US bankruptcy court by Nortel withdrew their motion to terminate medical benefits and long term disability benefits. The filing still indicated that they are reserving the right to file at a later time. At this point I think the benefits will have to be extended beyond August but we will have to see what their next move is. It looks like the letters sent in by everyone including the NRPC and the US Trustee had an impact on Nortel which resulted in this motion withdrawal. The hearing is still on for Aug 4th for a number of other items, but this action by Nortel may mean that the motion will not be on that agenda.
Here's a copy of the docket:
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF DELAWARE
--------------------------------------------------------------
In re
Nortel Networks Inc., et al.,1
Debtors.
Chapter 11
Case No. 09-10138 (KG)
Jointly Administered
Re: D.I. 3204
-------------------------------------------------------------- X
NOTICE OF WITHDRAWAL OF DEBTORS’ MOTION FOR ENTRY OF AN ORDER AUTHORIZING DEBTORS TO TERMINATE CERTAIN RETIREE AND LONGTERM DISABILITY PLANS [RE: D.I. 3204]
PLEASE TAKE NOTICE that Nortel Networks Inc. (“NNI”) and certain of its affiliates, as debtors and debtors in possession (collectively, the “Debtors”), in the above-captioned cases hereby withdraw without prejudice the Debtors’ Motion For Entry Of An Order Authorizing Debtors To Terminate Certain Retiree And Long-Term Disability Plans [D.I. 3204] (the “Motion”) filed with the Court on June 21, 2010.
The Debtors reserve all of their rights with respect to the relief sought in the Motion, including without limitation the right to file additional pleadings seeking similar relief.
1 The Debtors in these chapter 11 cases, along with the last four digits of each Debtor’s tax identification number, are: Nortel Networks Inc. (6332), Nortel Networks Capital Corporation (9620), Nortel Altsystems Inc. (9769), Nortel Altsystems International Inc. (5596), Xros, Inc. (4181), Sonoma Systems (2073), Qtera Corporation(0251), CoreTek, Inc. (5722), Nortel Networks Applications Management Solutions Inc.(2846), Nortel Networks Optical Components Inc. (3545), Nortel Networks HPOCS Inc. (3546), Architel Systems (U.S.) Corporation (3826), Nortel Networks International Inc. (0358), Northern Telecom International Inc. 6286),
Nortel Networks Cable Solutions Inc. (0567) and Nortel Networks (CALA) Inc. (4226). Addresses for the
Debtors can be found in the Debtors’ petitions, which are available at http://chapter11.epiqsystems.com/nortel.
Dated: July 15, 2010
Wilmington, Delaware
CLEARY GOTTLIEB STEEN & HAMILTON LLP
James L. Bromley (admitted pro hac vice)
Lisa M. Schweitzer (admitted pro hac vice)
One Liberty Plaza
New York, New York 10006
Telephone: (212) 225-2000
Facsimile: (212) 225-3999
- and -
MORRIS, NICHOLS, ARSHT & TUNNELL LLP
/s/ Ann C. Cordo
Derek C. Abbott (No. 3376)
Eric D. Schwartz (No. 3134)
Ann C. Cordo (No. 4817)
Alissa T. Gazze (No. 5338)
1201 North Market Street
P.O. Box 1347
Wilmington, Delaware 19801
Telephone: (302) 658-9200
Facsimile: (302) 658-3989
Counsel for the Debtors and Debtors in Possession
3672161.1
Here's a copy of the docket:
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF DELAWARE
--------------------------------------------------------------
In re
Nortel Networks Inc., et al.,1
Debtors.
Chapter 11
Case No. 09-10138 (KG)
Jointly Administered
Re: D.I. 3204
-------------------------------------------------------------- X
NOTICE OF WITHDRAWAL OF DEBTORS’ MOTION FOR ENTRY OF AN ORDER AUTHORIZING DEBTORS TO TERMINATE CERTAIN RETIREE AND LONGTERM DISABILITY PLANS [RE: D.I. 3204]
PLEASE TAKE NOTICE that Nortel Networks Inc. (“NNI”) and certain of its affiliates, as debtors and debtors in possession (collectively, the “Debtors”), in the above-captioned cases hereby withdraw without prejudice the Debtors’ Motion For Entry Of An Order Authorizing Debtors To Terminate Certain Retiree And Long-Term Disability Plans [D.I. 3204] (the “Motion”) filed with the Court on June 21, 2010.
The Debtors reserve all of their rights with respect to the relief sought in the Motion, including without limitation the right to file additional pleadings seeking similar relief.
1 The Debtors in these chapter 11 cases, along with the last four digits of each Debtor’s tax identification number, are: Nortel Networks Inc. (6332), Nortel Networks Capital Corporation (9620), Nortel Altsystems Inc. (9769), Nortel Altsystems International Inc. (5596), Xros, Inc. (4181), Sonoma Systems (2073), Qtera Corporation(0251), CoreTek, Inc. (5722), Nortel Networks Applications Management Solutions Inc.(2846), Nortel Networks Optical Components Inc. (3545), Nortel Networks HPOCS Inc. (3546), Architel Systems (U.S.) Corporation (3826), Nortel Networks International Inc. (0358), Northern Telecom International Inc. 6286),
Nortel Networks Cable Solutions Inc. (0567) and Nortel Networks (CALA) Inc. (4226). Addresses for the
Debtors can be found in the Debtors’ petitions, which are available at http://chapter11.epiqsystems.com/nortel.
Dated: July 15, 2010
Wilmington, Delaware
CLEARY GOTTLIEB STEEN & HAMILTON LLP
James L. Bromley (admitted pro hac vice)
Lisa M. Schweitzer (admitted pro hac vice)
One Liberty Plaza
New York, New York 10006
Telephone: (212) 225-2000
Facsimile: (212) 225-3999
- and -
MORRIS, NICHOLS, ARSHT & TUNNELL LLP
/s/ Ann C. Cordo
Derek C. Abbott (No. 3376)
Eric D. Schwartz (No. 3134)
Ann C. Cordo (No. 4817)
Alissa T. Gazze (No. 5338)
1201 North Market Street
P.O. Box 1347
Wilmington, Delaware 19801
Telephone: (302) 658-9200
Facsimile: (302) 658-3989
Counsel for the Debtors and Debtors in Possession
3672161.1
Thursday, July 15, 2010
August 4th court hearing documents
I received a delivery from Epiq today with the notice of the rescheduling for the hearing from July 16th to August 4th. The document indicated that they had received over 300 objections to the termination of benefits including one from the NPRC lawyer representing 400 retirees, and also one from the US trustee challenging Nortel's decision.
It looks like the hearing on Aug 4th will have good representation for retiree and LTD interests and I sincerely hope that the judge rules in favor of forming a 1114 committee. If that is the case there is the likelihood that the Nortel benefits may not be terminated on September 1, since I can't see how a 1114 committee can be established and negotiate anything in that time frame.
If the judge rules against the formation of a 1114 committee, and in favor of Nortel terminating the benefits, then there are certainly opportunities to appeal the decision, as illustrated in previous court cases of a similar nature. An appeal by Delphi employees for example, resulted in a decision to award the employees $8m for the establishment of a benefits group to cover them after the benefits were terminated.
If Nortel is smart they would agree to the formation of a 1114 committee now, and extend the benefits until negotiations in the committee are completed. I'm not sure how long that took in other cases, but at the rate things are decided in bankruptcy court it probably would be months before a decision is reached.
It looks like the hearing on Aug 4th will have good representation for retiree and LTD interests and I sincerely hope that the judge rules in favor of forming a 1114 committee. If that is the case there is the likelihood that the Nortel benefits may not be terminated on September 1, since I can't see how a 1114 committee can be established and negotiate anything in that time frame.
If the judge rules against the formation of a 1114 committee, and in favor of Nortel terminating the benefits, then there are certainly opportunities to appeal the decision, as illustrated in previous court cases of a similar nature. An appeal by Delphi employees for example, resulted in a decision to award the employees $8m for the establishment of a benefits group to cover them after the benefits were terminated.
If Nortel is smart they would agree to the formation of a 1114 committee now, and extend the benefits until negotiations in the committee are completed. I'm not sure how long that took in other cases, but at the rate things are decided in bankruptcy court it probably would be months before a decision is reached.
Wednesday, July 14, 2010
Aon acquiring Hewitt Associates - US Nortel 401k related
For those of you with Nortel 401K accounts managed by Hewitt, the following story at CNBC.com may important. Hewitt is being acquired and that may result in some changes impacting the way the 401K account is managed. Probably nothing short term, but it is worth looking out for communications on the Hewitt site to see if there are any changes coming.
Check of the story at http://www.cnbc.com//id/38200814
Aon, the world's largest insurance brokerage, said it will acquire human-resource service company Hewitt Associates for about $4.9 billion in cash and stock to beef up its consulting business.
Aon's offer of $50 a share is 41 percent more than Hewitt's closing stock price on Friday. The deal will help Aon get a firm foothold in human resource and benefits outsourcing and take on rival insurance broker Marsh and McLennan's Mercer unit. Aon plans to integrate Hewitt with its existing consulting and outsourcing operations and sees annual revenue of $4.3 billion for the combined entity, which will be named Aon Hewitt.
Russ Fradin, chairman and chief executive officer of Hewitt, will head Aon Hewitt. Aon expects the deal to add to 2011 and 2012 earnings and generate about $355 million in annual cost savings in 2013, primarily from reduction in back-office areas.
The Aon-Hewitt deal is the second major deal in the consultancy space in a year after Towers Perrin and Watson Wyatt agreed to a $3.5 billion merger to create the world's largest HR consultants.
The insurance brokerage expects to finance the deal through a $1.5 billion bridge facility and $1 billion bank term loan.
Check of the story at http://www.cnbc.com//id/38200814
Aon, the world's largest insurance brokerage, said it will acquire human-resource service company Hewitt Associates for about $4.9 billion in cash and stock to beef up its consulting business.
Aon's offer of $50 a share is 41 percent more than Hewitt's closing stock price on Friday. The deal will help Aon get a firm foothold in human resource and benefits outsourcing and take on rival insurance broker Marsh and McLennan's Mercer unit. Aon plans to integrate Hewitt with its existing consulting and outsourcing operations and sees annual revenue of $4.3 billion for the combined entity, which will be named Aon Hewitt.
Russ Fradin, chairman and chief executive officer of Hewitt, will head Aon Hewitt. Aon expects the deal to add to 2011 and 2012 earnings and generate about $355 million in annual cost savings in 2013, primarily from reduction in back-office areas.
The Aon-Hewitt deal is the second major deal in the consultancy space in a year after Towers Perrin and Watson Wyatt agreed to a $3.5 billion merger to create the world's largest HR consultants.
The insurance brokerage expects to finance the deal through a $1.5 billion bridge facility and $1 billion bank term loan.
Tuesday, July 13, 2010
Important new dockets on Epiq Site
There were 2 really important dockets placed on the Epiq Web site in the last couple of days and I suggest that people look at them to understand what is going on.
The first docket #3580 is the proposed chapter 11 plan by Nortel which goes into great detail as to how claims will be treated, who will have the right to vote, and what the procedures will be for completing the wind up of the assets. It includes information on the distribution of claims, tax implications, and disputed claims. There is no real detail yet as to the amount and value of claims considered nor the amount of money that will be considered for distribution.
It indicates that when the plan details are made available, unsecured creditors like us will have impaired claims, which means the plan will impair the value of our claims. Unsecured creditors with impaired claims will have the right to vote on the distribution plan. This is a large and complex document and you will have to examine it carefully to understand the impact on you.
The second docket #3584 is the 50th report by the Canadian monitor Ernst and Young. It contains a status on the cash situation and also the events that have happened over the last few months including the agreement with Canadian Pensioners,the Hardship process, The Health and Welfare Trust, the start of transfer of the Canadian Pension to FSCO administration, and the initial work to determine asset allocation. None of these topics are covered in great detail but may be useful to you depending on your particular situation.
The cash situation as reported by E&Y is $5.7B worldwide. That includes the cash from sale of assets and also operational cash. There is$3.03B in escrow from the sale of assets. The rest is operational cash including some restricted cash. The report states the following division for operational cash:
Canada $276M
USA $766M
UK $350M
EMEA $391M
Asia $606M
Cala $167M
Netas $67M
The first docket #3580 is the proposed chapter 11 plan by Nortel which goes into great detail as to how claims will be treated, who will have the right to vote, and what the procedures will be for completing the wind up of the assets. It includes information on the distribution of claims, tax implications, and disputed claims. There is no real detail yet as to the amount and value of claims considered nor the amount of money that will be considered for distribution.
It indicates that when the plan details are made available, unsecured creditors like us will have impaired claims, which means the plan will impair the value of our claims. Unsecured creditors with impaired claims will have the right to vote on the distribution plan. This is a large and complex document and you will have to examine it carefully to understand the impact on you.
The second docket #3584 is the 50th report by the Canadian monitor Ernst and Young. It contains a status on the cash situation and also the events that have happened over the last few months including the agreement with Canadian Pensioners,the Hardship process, The Health and Welfare Trust, the start of transfer of the Canadian Pension to FSCO administration, and the initial work to determine asset allocation. None of these topics are covered in great detail but may be useful to you depending on your particular situation.
The cash situation as reported by E&Y is $5.7B worldwide. That includes the cash from sale of assets and also operational cash. There is$3.03B in escrow from the sale of assets. The rest is operational cash including some restricted cash. The report states the following division for operational cash:
Canada $276M
USA $766M
UK $350M
EMEA $391M
Asia $606M
Cala $167M
Netas $67M
Monday, July 12, 2010
Nortel places medical and welfare plan documents on Epiq Web Site
The US Trustee in her motion before the court pointed out that Nortel had not provided copies of the various medical and welfare plan documents as part of their original motion to terminate benefits. Nortel has responded by filing copies of a number of helath and welfare documents. You can check the document in the docket # 3515 at the Epiq Web Site. Interesting thing is that they chose the 1992 document which contains the right to terminate clause. A number of retirees have the 1991 document which does not contain that clause. (Link to Epiq in the right hand column.)
Here is the text of their filing summary:
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF DELAWARE
-----------------------------------------------------------
In re
Nortel Networks Inc., et al., 1
Debtors.
Chapter 11
Case No. 09-10138 (KG)
Jointly Administered
RE: D.I. 3204
-----------------------------------------------------------X
DEBTORS’ NOTICE OF FILING OF EXHIBITS TO THE DEBTORS’ MOTION FOR ENTRY OF AN ORDER AUTHORIZING DEBTORS TO TERMINATE CERTAIN RETIREE AND LONG TERM DISABILITY PLANS PLEASE TAKE NOTICE that the following documents are attached hereto as exhibits to the Debtors’ Motion For Entry Of An Order Authorizing Debtors To Terminate Certain Retiree And Long Term Disability Plans (D.I. 3204) filed by the above-captioned debtors and debtors in possession on June 21, 2010:
Exhibit A: Retiree Medical Plan and Retiree Life Insurance and Long-Term Care
Plan dated January 1, 1992
Exhibit B: Retiree Medical Plan Summary Plan Description 2010
Exhibit C: Nortel Networks Retiree Life Insurance and Long-Term Care Plan
Summary Plan Description 2010
Exhibit D: Nortel Networks Inc., Long-Term Disability Plan Summary Plan
Description 2010
Exhibit E: Nortel Networks FLEX Benefits Program
Exhibit F: Nortel Networks Welfare Benefits Plan
Here is the text of their filing summary:
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF DELAWARE
-----------------------------------------------------------
In re
Nortel Networks Inc., et al., 1
Debtors.
Chapter 11
Case No. 09-10138 (KG)
Jointly Administered
RE: D.I. 3204
-----------------------------------------------------------X
DEBTORS’ NOTICE OF FILING OF EXHIBITS TO THE DEBTORS’ MOTION FOR ENTRY OF AN ORDER AUTHORIZING DEBTORS TO TERMINATE CERTAIN RETIREE AND LONG TERM DISABILITY PLANS PLEASE TAKE NOTICE that the following documents are attached hereto as exhibits to the Debtors’ Motion For Entry Of An Order Authorizing Debtors To Terminate Certain Retiree And Long Term Disability Plans (D.I. 3204) filed by the above-captioned debtors and debtors in possession on June 21, 2010:
Exhibit A: Retiree Medical Plan and Retiree Life Insurance and Long-Term Care
Plan dated January 1, 1992
Exhibit B: Retiree Medical Plan Summary Plan Description 2010
Exhibit C: Nortel Networks Retiree Life Insurance and Long-Term Care Plan
Summary Plan Description 2010
Exhibit D: Nortel Networks Inc., Long-Term Disability Plan Summary Plan
Description 2010
Exhibit E: Nortel Networks FLEX Benefits Program
Exhibit F: Nortel Networks Welfare Benefits Plan
Sunday, July 11, 2010
United Healthcare Materials Arrived
When Nortel made the motion to terminate the medical benefits they also sent information out stating that they had arranged with United Healthcare to make offers to retirees and dependants for continuance of health benefits.
I received materials yesterday from United Healthcare for their various plans that are offered to retirees on medicare. They offer supplementary plans and also a Medicare Advantage plan. The specific details I received were for the Medicare Advantage plan and it looks pretty good.
The plan will be different in different states, but the one for Georgia where I live offered coverage for no additional premium. As long as I am enrolled in Medicare part B and continue to pay the Medicare premiums this Advantage plan can work for me.
There are some catches but overall it is a lot better than I expected.
First of all there is no extra premium. The cost to join and participate is zero.
However I will have to be part of the United Healthcare network since the plan is an HMO-POS plan, so I will have to first of all check to see if my doctors and hospitals accept that insurance.
Secondly I will have to pay a co-pay when I go see a doctor, but I won't have to pay any deductible and there is no 20% payment like now with original Medicare.
My medicines will be covered for a reasonable low co-pay.
I will receive some vision insurance, which I currently don't have with Medicare.
Also for an extra premium of $32 per month and a $100 deductible I can add dental insurance. I'm not sure if that is such a good deal, but it is optional.
So overall the United Healthcare advantage plan looks like it would work for me.
My wife has not yet received any information from United Helthcare for her situation. As my spouse, she was covered by Nortel Cigna since she is not yet eligible for Medicare. I expect the premium to cover her will be more expensive but we can only wait and see.
In the meantime the hearing in the court is now scheduled for August 4th which doesn't give us a lot of time to make any decisions. I hope the judge rules for an extension so that we can get properly organized for the changes we need to make.
I received materials yesterday from United Healthcare for their various plans that are offered to retirees on medicare. They offer supplementary plans and also a Medicare Advantage plan. The specific details I received were for the Medicare Advantage plan and it looks pretty good.
The plan will be different in different states, but the one for Georgia where I live offered coverage for no additional premium. As long as I am enrolled in Medicare part B and continue to pay the Medicare premiums this Advantage plan can work for me.
There are some catches but overall it is a lot better than I expected.
First of all there is no extra premium. The cost to join and participate is zero.
However I will have to be part of the United Healthcare network since the plan is an HMO-POS plan, so I will have to first of all check to see if my doctors and hospitals accept that insurance.
Secondly I will have to pay a co-pay when I go see a doctor, but I won't have to pay any deductible and there is no 20% payment like now with original Medicare.
My medicines will be covered for a reasonable low co-pay.
I will receive some vision insurance, which I currently don't have with Medicare.
Also for an extra premium of $32 per month and a $100 deductible I can add dental insurance. I'm not sure if that is such a good deal, but it is optional.
So overall the United Healthcare advantage plan looks like it would work for me.
My wife has not yet received any information from United Helthcare for her situation. As my spouse, she was covered by Nortel Cigna since she is not yet eligible for Medicare. I expect the premium to cover her will be more expensive but we can only wait and see.
In the meantime the hearing in the court is now scheduled for August 4th which doesn't give us a lot of time to make any decisions. I hope the judge rules for an extension so that we can get properly organized for the changes we need to make.
Friday, July 9, 2010
Hearing rescheduled on Nortel motion to terminate medical and other benefits
The US Trustee has filed a motion requesting a reschedule of the hearing on terminating the medical and LTD benefits. The motion is contained in docket 3508 on the Epiq Website. The Judge has now rescheduled the hearing from July 16th to August 4th, probably as a result of the motion by the US Trustee. See docket 3505
Here is the motion by the US trustee:
UNITED STATES TRUSTEE’S RESPONSE AND REQUEST FOR A CONTINUANCE WITH RESPECT TO DEBTORS’ MOTION FOR AN ORDER AUTHORIZING DEBTORS TO TERMINATE CERTAIN RETIREE AND LONG TERM DISABILITY PLANS.
Roberta A. DeAngelis, United States Trustee for Region 3, by and through her undersigned counsel, hereby responds to the Debtors’ Motion for an Order authorizing Debtors Terminate Certain Retiree and Long Term Disability Plans as follows:
1. This Court has jurisdiction to hear and determine this Response.
2. Pursuant to 28 U.S.C. § 586(a)(3), the United States Trustee is charged with administrative oversight of the bankruptcy system in this District. Such oversight is part of the United States Trustee’s overarching responsibility to enforce the laws as written by Congress and interpreted by the courts.
See United States Trustee v. Columbia Gas Systems, Inc. (In re Columbia Gas Systems, Inc.), 33 F.3d 294, 295-96 (3d Cir. 1994) (noting that UST has “public interest standing” under 11 U.S.C. § 307 which goes beyond mere pecuniary interest); Morgenstern v. Revco D.S., Inc. (In re Revco D.S., Inc.), 898 F.2d 498, 500 (6th Cir. 1990) (describing the UST as a “watchdog”).
3. Under 11 U.S.C. § 307, the United States Trustee has standing to be heard on the issues raised by the Debtors’ Motion.
4. On June 21, 2010, the Debtors filed a motion for authority to terminate certain retirees and long term disability plans (the “Plans”). The notice to the motion required that an objection, answer or responsive pleading be filed by July, 6, 2010. A hearing on the motion is presently scheduled for July 16, 2010. Counsel for the Debtors and counsel for the United States Trustee have discussed various aspects of the motion, and counsel for the Debtors agreed to extend the time for the United States Trustee to respond to Friday, July 9, 2010.
5. The United States Trustee requests that the Court adjourn the hearing on the matter scheduled for July 16, 2010 for a reasonable period of time to give the United States Trustee and other parties the opportunity to consider whether the relief requested is appropriate or permissible under the Bankruptcy Code.
6. The Debtors allege that the Plans provide the Debtors with “the unequivocal right to unilaterally amend or terminate the plans at any time.” Further, the Debtors argue that the same provisions render the statutory requirements of Section 1114 of the Bankruptcy Code inapplicable. Further still, the Debtors argue that the Debtors’ contractual right to terminate is not affected by this bankruptcy filing and court approval is not necessary. Notwithstanding this final argument, the Debtors still want the Court to authorize the termination of benefits for the Debtors’ former employees who are retired or who have suffered long term disabilities.
7. In support of their motion, the Debtors make summary references to provisions allegedly in the Plans without attaching copies of the Plans. The United States Trustee believes that the court should not rule on the motion unless and until parties have a reasonable opportunity to examine the documents referenced but not included in the motion. The Debtors should be required to file the Plans with the Court, as well as to provide copies to those employees and employees’ families who are members of the plans sought to be terminated.
8. In support of their motion, the Debtors argue that Section 1114 of the Bankruptcy Code is inapplicable, and cite caselaw in support of their position. The United States Trustee notes that none of these cases are controlling as to this issue and that the Debtors failed to acknowledge various other decisions including In re Farmland Indus., Inc., 294 B.R. 903 (Bankr. W.D. Mo.2003), holding that a retirement benefit cannot be modified without complying with Section 1114.
9. In support of their motion, the Debtors argue “ the exercise of their reasonable business judgment” as the legal basis for termination of the Plans. The Debtors then state that “[p]roviding these benefits is a significant financial burden that does not provide any concomitant benefit to the estate.” The United States Trustee believes the Debtors have the burden to demonstrate through evidence at trial that there is a sufficient basis for the decision to terminate the Plans. This court must hold the Debtors to their burdens in this situation wherein the termination of such plans will have a significant impact on the well being of the Debtors’ retirees. This is particularly true in this case wherein the Debtors previously sought and were granted authority to pay well in excess of $50 million dollars to members of their senior management and now claim they are unable to afford $2 million dollars per month for the cost of these plans.
10. The United States Trustee notes that as of the date of the filing of this Response, approximately two hundred objections have been filed by individuals or counsel for individuals opposing the Debtors’ motion.
11. Many of these objections also include a request that the Court order the appointment of a committee that would represent the interests of the former employees.
12. The United States Trustee supports the requests to this court seeking an order directing the appointment of a committee to represent the interest of the former employees of the Debtors. At a minimum, a retirees’ committee would have the ability to review the Plans to ascertain whether or not the Debtors’ interpretation of termination provisions is correct.
13. Accordingly, given the request for the appointment of a retirees committee, the United States Trustee respectfully requests that the hearing on the motion be adjourned and that the Court direct the appointment of a retirees committee. To allow sufficient time for the United States Trustee to form the committee, the United States Trustee requests the hearing be rescheduled to no earlier than August 31, 2010, if the Court’s calendar permits.
14. The United States Trustee avers that granting an adjournment to the date requested above or thereafter causes little prejudice to the debtors as the motion (if granted) indicates that the Plans proposed termination effective date is August 31, 2010. The Debtors indicate they have paid all costs and expenses associated with the Plans and will continue to pay all costs and expenses through August 31, 2010.
15. The United States Trustee reserves any and all rights, remedies and obligations to, inter alia, complement, supplement, augment, alter, substitute and/or modify this Response and to take any further action as may be required or to conduct any and all discovery as may be deemed necessary or as may be required and to assert such other grounds as may become apparent. WHEREFORE, the United States Trustee respectfully requests this Court to adjourn the hearing to give the United States Trustee and other parties a reasonable opportunity to consider the motion and file a response, if appropriate, and for all other relief that is just and proper, including directing the appointment of a retirees committee.
Respectfully submitted,
ROBERTA A. DEANGELIS
United States Trustee
BY: /s/ Kevin P Callahan
Kevin P. Callahan
Trial Attorney
Office of the United States Trustee
J. Caleb Boggs Federal Building
844 King Street, Suite 2207
Dated: July 9, 2010 Wilmington, DE 19801
(302) 573-6491
(302) 573-6497 fax
Here is the motion by the US trustee:
UNITED STATES TRUSTEE’S RESPONSE AND REQUEST FOR A CONTINUANCE WITH RESPECT TO DEBTORS’ MOTION FOR AN ORDER AUTHORIZING DEBTORS TO TERMINATE CERTAIN RETIREE AND LONG TERM DISABILITY PLANS.
Roberta A. DeAngelis, United States Trustee for Region 3, by and through her undersigned counsel, hereby responds to the Debtors’ Motion for an Order authorizing Debtors Terminate Certain Retiree and Long Term Disability Plans as follows:
1. This Court has jurisdiction to hear and determine this Response.
2. Pursuant to 28 U.S.C. § 586(a)(3), the United States Trustee is charged with administrative oversight of the bankruptcy system in this District. Such oversight is part of the United States Trustee’s overarching responsibility to enforce the laws as written by Congress and interpreted by the courts.
See United States Trustee v. Columbia Gas Systems, Inc. (In re Columbia Gas Systems, Inc.), 33 F.3d 294, 295-96 (3d Cir. 1994) (noting that UST has “public interest standing” under 11 U.S.C. § 307 which goes beyond mere pecuniary interest); Morgenstern v. Revco D.S., Inc. (In re Revco D.S., Inc.), 898 F.2d 498, 500 (6th Cir. 1990) (describing the UST as a “watchdog”).
3. Under 11 U.S.C. § 307, the United States Trustee has standing to be heard on the issues raised by the Debtors’ Motion.
4. On June 21, 2010, the Debtors filed a motion for authority to terminate certain retirees and long term disability plans (the “Plans”). The notice to the motion required that an objection, answer or responsive pleading be filed by July, 6, 2010. A hearing on the motion is presently scheduled for July 16, 2010. Counsel for the Debtors and counsel for the United States Trustee have discussed various aspects of the motion, and counsel for the Debtors agreed to extend the time for the United States Trustee to respond to Friday, July 9, 2010.
5. The United States Trustee requests that the Court adjourn the hearing on the matter scheduled for July 16, 2010 for a reasonable period of time to give the United States Trustee and other parties the opportunity to consider whether the relief requested is appropriate or permissible under the Bankruptcy Code.
6. The Debtors allege that the Plans provide the Debtors with “the unequivocal right to unilaterally amend or terminate the plans at any time.” Further, the Debtors argue that the same provisions render the statutory requirements of Section 1114 of the Bankruptcy Code inapplicable. Further still, the Debtors argue that the Debtors’ contractual right to terminate is not affected by this bankruptcy filing and court approval is not necessary. Notwithstanding this final argument, the Debtors still want the Court to authorize the termination of benefits for the Debtors’ former employees who are retired or who have suffered long term disabilities.
7. In support of their motion, the Debtors make summary references to provisions allegedly in the Plans without attaching copies of the Plans. The United States Trustee believes that the court should not rule on the motion unless and until parties have a reasonable opportunity to examine the documents referenced but not included in the motion. The Debtors should be required to file the Plans with the Court, as well as to provide copies to those employees and employees’ families who are members of the plans sought to be terminated.
8. In support of their motion, the Debtors argue that Section 1114 of the Bankruptcy Code is inapplicable, and cite caselaw in support of their position. The United States Trustee notes that none of these cases are controlling as to this issue and that the Debtors failed to acknowledge various other decisions including In re Farmland Indus., Inc., 294 B.R. 903 (Bankr. W.D. Mo.2003), holding that a retirement benefit cannot be modified without complying with Section 1114.
9. In support of their motion, the Debtors argue “ the exercise of their reasonable business judgment” as the legal basis for termination of the Plans. The Debtors then state that “[p]roviding these benefits is a significant financial burden that does not provide any concomitant benefit to the estate.” The United States Trustee believes the Debtors have the burden to demonstrate through evidence at trial that there is a sufficient basis for the decision to terminate the Plans. This court must hold the Debtors to their burdens in this situation wherein the termination of such plans will have a significant impact on the well being of the Debtors’ retirees. This is particularly true in this case wherein the Debtors previously sought and were granted authority to pay well in excess of $50 million dollars to members of their senior management and now claim they are unable to afford $2 million dollars per month for the cost of these plans.
10. The United States Trustee notes that as of the date of the filing of this Response, approximately two hundred objections have been filed by individuals or counsel for individuals opposing the Debtors’ motion.
11. Many of these objections also include a request that the Court order the appointment of a committee that would represent the interests of the former employees.
12. The United States Trustee supports the requests to this court seeking an order directing the appointment of a committee to represent the interest of the former employees of the Debtors. At a minimum, a retirees’ committee would have the ability to review the Plans to ascertain whether or not the Debtors’ interpretation of termination provisions is correct.
13. Accordingly, given the request for the appointment of a retirees committee, the United States Trustee respectfully requests that the hearing on the motion be adjourned and that the Court direct the appointment of a retirees committee. To allow sufficient time for the United States Trustee to form the committee, the United States Trustee requests the hearing be rescheduled to no earlier than August 31, 2010, if the Court’s calendar permits.
14. The United States Trustee avers that granting an adjournment to the date requested above or thereafter causes little prejudice to the debtors as the motion (if granted) indicates that the Plans proposed termination effective date is August 31, 2010. The Debtors indicate they have paid all costs and expenses associated with the Plans and will continue to pay all costs and expenses through August 31, 2010.
15. The United States Trustee reserves any and all rights, remedies and obligations to, inter alia, complement, supplement, augment, alter, substitute and/or modify this Response and to take any further action as may be required or to conduct any and all discovery as may be deemed necessary or as may be required and to assert such other grounds as may become apparent. WHEREFORE, the United States Trustee respectfully requests this Court to adjourn the hearing to give the United States Trustee and other parties a reasonable opportunity to consider the motion and file a response, if appropriate, and for all other relief that is just and proper, including directing the appointment of a retirees committee.
Respectfully submitted,
ROBERTA A. DEANGELIS
United States Trustee
BY: /s/ Kevin P Callahan
Kevin P. Callahan
Trial Attorney
Office of the United States Trustee
J. Caleb Boggs Federal Building
844 King Street, Suite 2207
Dated: July 9, 2010 Wilmington, DE 19801
(302) 573-6491
(302) 573-6497 fax
CRA has accepted Nortel's foreign Service Accrual method in calculating pensons.
I received the following note from a representative of the NRPC regarding Foreign Service Accrual in pensions. The Canadian Revenue Agency has accepted Nortel's traditional method for including foreign service when they are calculating the amount of pension a retiree will receive. This is good news for a change. It means that many of us who worked in multiple countries will be able to breath a little easier since the basic pension calculation will remain as promised by Nortel. Possible reductions due to trust fund issues and annuity rates will still apply of course.
Here's a copy of the email.
For those of you who have been worried about, or caught up in the delays caused by, the negotiations with the Canada Revenue Agency regarding foreign service accrual when calculating pensions, we have good news from our legal representatives, Koskie Minsky LLP.
The CRA has accepted the Nortel approach to calculating foreign service in the pension calculation. The attached letter from the CRA to the Monitor provides a somewhat complex answer to this good news. Koskie Minsky will post more on their website in the next week or so but for now you can get a good night's rest.
For those who have recently applied for their Canadian pension and were put on hold, I do not know how quickly things will get restarted but this letter should allow things to proceed
Here's a copy of the email.
For those of you who have been worried about, or caught up in the delays caused by, the negotiations with the Canada Revenue Agency regarding foreign service accrual when calculating pensions, we have good news from our legal representatives, Koskie Minsky LLP.
The CRA has accepted the Nortel approach to calculating foreign service in the pension calculation. The attached letter from the CRA to the Monitor provides a somewhat complex answer to this good news. Koskie Minsky will post more on their website in the next week or so but for now you can get a good night's rest.
For those who have recently applied for their Canadian pension and were put on hold, I do not know how quickly things will get restarted but this letter should allow things to proceed
Thursday, July 8, 2010
Letters of objection to Nortel motion in US court
The letters have been pouring into the US bankruptcy court objecting to the motion by Nortel US to terminate the medical, long term care, and disability benefits. There are close to 100 objections already registered. The letters are displayed on the Epiq Systems web site.
Many of the letters are heartbreaking, telling stories of the dedicated service people have provided to Nortel only to be treated in this shabby manner. Many people are totally dependent on the disability payments and will suffer enormously as a result if this motion is allowed to pass. Other people are suffering from severe medical problems that are life threatening and their treatment is in jeopardy if the benefits are cut off. You can access the letters by clicking on the Epiq link in the right hand column and then clicking on dockets. Open the document (in blue) in each docket to read specific letters.
Judge Gross has a lot to read, and a lot to think about. Surely he will take notice and do the right thing and dismiss this motion.
Even though the July 6th deadline has now passed, you can still send a letter of objection. The deadline was only for those people who wished to attend the hearing. They needed to register the objection formally by that date. However you can still have your voice heard by writing a letter per the instructions I posted earlier. (Look in the post archive to find the details.)
Many of the letters are heartbreaking, telling stories of the dedicated service people have provided to Nortel only to be treated in this shabby manner. Many people are totally dependent on the disability payments and will suffer enormously as a result if this motion is allowed to pass. Other people are suffering from severe medical problems that are life threatening and their treatment is in jeopardy if the benefits are cut off. You can access the letters by clicking on the Epiq link in the right hand column and then clicking on dockets. Open the document (in blue) in each docket to read specific letters.
Judge Gross has a lot to read, and a lot to think about. Surely he will take notice and do the right thing and dismiss this motion.
Even though the July 6th deadline has now passed, you can still send a letter of objection. The deadline was only for those people who wished to attend the hearing. They needed to register the objection formally by that date. However you can still have your voice heard by writing a letter per the instructions I posted earlier. (Look in the post archive to find the details.)
Tuesday, July 6, 2010
NUSRPC attornies file motion objecting to Nortel terminating medical & LTD benefits
A number of court dockets were published today on the Epiq Systems web site that are important to retirees and Nortel employees on LTD.
First of all the official "court recognized" committee of unsecured creditors has filed a joinder which basically supports Nortel's Motion to terminate US retiree medical and long term benefits and US disabled employee benefits.
Adding insult to injury, everyone should know that the PBGC (Pension Bord Guarantee Corp), which is now paying the US retirees pensions, are listed members on the unsecured creditor's committee. So the PBGC is agreeing with Nortel's cancelling of medical benefits and LTD payments.
Secondly, the Nortel US Retirees Protection Committee must have engaged a Delaware law firm to act on behalf of the retirees and LTD employees by filing an official objection.
The Law Firms engaged are:
Cross & Simon LLC and Farella Brown & Martell LLP and their objection motion may be seen in docket #3277 on the Epiq site in the right hand column.
I am really glad to see the NUSRPC take this action which means that there will be more influence on the court since the NUSRPC represents more than 400 paying members and likely to add more if the court grants the right to formation of a 1114 committee.
In the event that the court does appoint a 1114 committee then Nortel will be required to pay the legal bill.
First of all the official "court recognized" committee of unsecured creditors has filed a joinder which basically supports Nortel's Motion to terminate US retiree medical and long term benefits and US disabled employee benefits.
Adding insult to injury, everyone should know that the PBGC (Pension Bord Guarantee Corp), which is now paying the US retirees pensions, are listed members on the unsecured creditor's committee. So the PBGC is agreeing with Nortel's cancelling of medical benefits and LTD payments.
Secondly, the Nortel US Retirees Protection Committee must have engaged a Delaware law firm to act on behalf of the retirees and LTD employees by filing an official objection.
The Law Firms engaged are:
Cross & Simon LLC and Farella Brown & Martell LLP and their objection motion may be seen in docket #3277 on the Epiq site in the right hand column.
I am really glad to see the NUSRPC take this action which means that there will be more influence on the court since the NUSRPC represents more than 400 paying members and likely to add more if the court grants the right to formation of a 1114 committee.
In the event that the court does appoint a 1114 committee then Nortel will be required to pay the legal bill.
Objections to Nortel Motion
Today July 6th is the deadline for submission of objections to Nortel's motion to terminate benefits for retirees and disabled employees.
So far 12 letters of objection have been published though I expect there are more in process. My letter was mailed almost a week ago and so far has not been posted by Epiq so I imagine they have a number of letters to post. I will check again later and expect there may be more letters posted tomorrow even though they have been received by the deadline.
So far 12 letters of objection have been published though I expect there are more in process. My letter was mailed almost a week ago and so far has not been posted by Epiq so I imagine they have a number of letters to post. I will check again later and expect there may be more letters posted tomorrow even though they have been received by the deadline.
Friday, July 2, 2010
Letters to the court
I would like to thank all those who have emailed me and are writing letters to the court to object to Nortel's motion to terminate our benefits. There are a number of letters of objection already posted on the Epiq Systems website in the court dockets.
You can check them at http://chapter11.epiqsystems.com/NNI/docket/Default.aspx?rc=1&DMWin=3f9cfb5c-8024-478c-83cf-6ce5b732332c
You can also click on the Epiq link in the right hand column and go to dockets to review the letters.
Some of these letters are heartbreaking. People on disability may end up in abject poverty and suffering as a result of the termination of their benefits. Families will be broken apart, and people may die as a result of this.
I urge everyone to take action and write to the courts as soon as possible. Time is short. You only have until July 6th to have your objection registered. Send your letters by registered mail to make sure they get there in time. It is no coincidence that the time frame to object is so short and hampered by the July 4th week end. It is a strategy by Nortel and their faceless lawyers.
Here we are celebrating July 4th and commemorating people who felt strongly about life, liberty, and the pursuit of happiness. What a travesty that our benefits are being threatened and Nortel's lawyers are using that historical date to limit the time we have to respond and object.
You can check them at http://chapter11.epiqsystems.com/NNI/docket/Default.aspx?rc=1&DMWin=3f9cfb5c-8024-478c-83cf-6ce5b732332c
You can also click on the Epiq link in the right hand column and go to dockets to review the letters.
Some of these letters are heartbreaking. People on disability may end up in abject poverty and suffering as a result of the termination of their benefits. Families will be broken apart, and people may die as a result of this.
I urge everyone to take action and write to the courts as soon as possible. Time is short. You only have until July 6th to have your objection registered. Send your letters by registered mail to make sure they get there in time. It is no coincidence that the time frame to object is so short and hampered by the July 4th week end. It is a strategy by Nortel and their faceless lawyers.
Here we are celebrating July 4th and commemorating people who felt strongly about life, liberty, and the pursuit of happiness. What a travesty that our benefits are being threatened and Nortel's lawyers are using that historical date to limit the time we have to respond and object.
Thursday, July 1, 2010
NRPC-US Update June 30th 2010
The NRPC-US in an earlier email indicated that it was only operating in an informal mode going forward. However due to the action taken by Nortel to file a motion terminating Medical and other non-pension benefits the NRPC-US has issued the following email.
It would seem too much of a coincidence that Nortel waited until after the NRPC had made their earlier statement before making the motion to terminate benefits.
I think it certainly will help us to have the NRPC-US still active in some role and I hope all the members will support their efforts and follow their suggestion to voice objection to the Nortel motion.
The letter referenced has been sent to NRPC-US members. You may also view the letter I sent in the post below this one.
NUSRPC Members Update June 30, 2010
On June 9 the NUSRPC notified its members of its intent to refund all remaining member funds to those who had not filed claims for non-qualified pensions using Segal services.
On June 14 Nortel filed notice of their intention to discontinue all benefits as of September 1 2010. The NUSRPC has consulted with several law firms to explore what options we may have to oppose this motion. We believe it is prudent to suspend the planned refunds until the court has made a decision on the motions to be filed July 16.
The NUSRPC believes that the motion to discontinue benefits as of September 1 is fundamentally unfair to former Nortel U.S. employees. If you agree, we are asking for your help to alert the court to this injustice.
Specifically, we are asking for you to:
1. Please read the attached letter. In addition please forward it to any former Nortel employees you may know who are not NUSRPC members, but who may be affected by the cancellation of benefits.
2. If you agree with it as is, (or if you wish to add personal comments about your own situation) please print out two copies, add your name and address at the top and sign them. Mail one copy to the court and one copy to Nortel's attorneys at the addresses contained in the letter.
We would have preferred to send emails but unfortunately emails are not an acceptable form of communication with the court. If our views are to be recognized as part of the court record, they must be expressed on paper, signed and mailed.
We recognize that it is an inconvenience to print, sign, create envelopes, stamp and mail these letters but strongly urge that you make the effort to do so.
This mailing is not the only measure the NUSRPC is taking to defend your interests. We will keep you informed about this as matters proceed.
NUSRPC
It would seem too much of a coincidence that Nortel waited until after the NRPC had made their earlier statement before making the motion to terminate benefits.
I think it certainly will help us to have the NRPC-US still active in some role and I hope all the members will support their efforts and follow their suggestion to voice objection to the Nortel motion.
The letter referenced has been sent to NRPC-US members. You may also view the letter I sent in the post below this one.
NUSRPC Members Update June 30, 2010
On June 9 the NUSRPC notified its members of its intent to refund all remaining member funds to those who had not filed claims for non-qualified pensions using Segal services.
On June 14 Nortel filed notice of their intention to discontinue all benefits as of September 1 2010. The NUSRPC has consulted with several law firms to explore what options we may have to oppose this motion. We believe it is prudent to suspend the planned refunds until the court has made a decision on the motions to be filed July 16.
The NUSRPC believes that the motion to discontinue benefits as of September 1 is fundamentally unfair to former Nortel U.S. employees. If you agree, we are asking for your help to alert the court to this injustice.
Specifically, we are asking for you to:
1. Please read the attached letter. In addition please forward it to any former Nortel employees you may know who are not NUSRPC members, but who may be affected by the cancellation of benefits.
2. If you agree with it as is, (or if you wish to add personal comments about your own situation) please print out two copies, add your name and address at the top and sign them. Mail one copy to the court and one copy to Nortel's attorneys at the addresses contained in the letter.
We would have preferred to send emails but unfortunately emails are not an acceptable form of communication with the court. If our views are to be recognized as part of the court record, they must be expressed on paper, signed and mailed.
We recognize that it is an inconvenience to print, sign, create envelopes, stamp and mail these letters but strongly urge that you make the effort to do so.
This mailing is not the only measure the NUSRPC is taking to defend your interests. We will keep you informed about this as matters proceed.
NUSRPC
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