Q: Why is our 401k a matching contribution, rather than a direct contribution from the Company? And why is our percentage lower than AS pilots?
AS pilots also have direct contribution – they traded a financially untenable defined benefit pension plan for the direct match. Their pension plan would have put the company in financial jeopardy. Their pension plan was in danger of underfunding, and the Company would have had to put a significant amount of money into the plan as a result. Instead, they negotiated the 401k contribution and a sort of retiree medical with ALPA to eliminate the defined benefit plan. That is one reason why the pilots have a larger percentage direct contribution – another factor being the mandatory retirement age, while Flight Attendants are able to work longer and contribute over a longer amount of time.
Negotiating into the 401k from the defined benefits pension plan was considered a concession by the pilots.
No Flight Attendant group is even close to a 16% contribution, much less direct contribution. Southwest is the highest at 9.3%. Several Flight Attendant groups, including HA, have a combination of direct contribution (the Company contributes to their 401k regardless of Flight Attendant contribution) and matching contribution (Company will match what the Flight Attendant contributes).
Although we absolutely wanted and proposed higher percentages and/or direct contribution, both come with significant trade-offs in other areas of the Contract. In the end, we felt there was more benefit to investing the money elsewhere in the contract, while still achieving a healthy increase to the percentage. We did achieve an increase in the 401(k) match, just not the higher one we were seeking. The TA puts us in third place, slightly behind SW and DL.