Delta asked to stop exec bonuses until it funds pilot pensions

Atlanta-based Delta plans to block the proposal from going up for a shareholder vote, unless U.S. Securities and Exchange Commission staff says otherwise.

Delta terminated its pilot pension plan while in bankruptcy through a deal in 2006 with the Pension Benefit Guaranty Corp., the quasi- government federal agency that insures pension plans up to certain limits. The move reduced pension benefits for many retired pilots.

The retired pilot who filed the shareholder proposal Jan. 9, Kenneth Wendell Lewis, noted that he is a shareholder and proposed that the board prohibit cash- or stock-bonus payments to management or executive officers unless there is a process to fund retirement accounts for pilots who retired before Dec. 13, 2007.

In a letter to the SEC’s division of corporate finance, Delta said it believes it can exclude the item from its proxy for shareholder voting because the proposal relates to the company’s ordinary business operations and because it is “designed to further a personal interest.” The company also said a letter Lewis submitted on his shareholder status did not meet requirements under a federal rule.

Lewis declined to comment on his filing, pending a response from the SEC staff. He also is vice chairman of the Delta Pilots Pension Preservation Organization, but he submitted the proposal independently.

The retired pilots group filed an administrative appeal last year over the lost pension benefits and is awaiting a decision from the PBGC.

Support real journalism. Support local journalism. Subscribe to The Atlanta Journal-Constitution today. See offers.

Your subscription to the Atlanta Journal-Constitution funds in-depth reporting and investigations that keep you informed. Thank you for supporting real journalism.