Last week, I testified before the House Education and Labor Subcommittee on Health, Employment, Labor and Pensions investigating Delphi’s bankruptcy and the management of its former employees’ pension plans. I shared with my colleagues on the congressional panel how the former automotive parts manufacturers’ insolvency has impacted families across the Miami Valley.
by Congressman Michael Turner
Last week, I testified before the House Education and Labor Subcommittee on Health, Employment, Labor and Pensions investigating Delphi’s bankruptcy and the management of its former employees’ pension plans. I shared with my colleagues on the congressional panel how the former automotive parts manufacturers’ insolvency has impacted families across the Miami Valley.
Delphi has long been a fixture in Southwest Ohio. The company was founded by Charles F. Kettering and Edward Deeds in 1909 as Dayton Engineering Laboratories Company. Through the hard work of Ohioans, the company later evolved into Delco, and in 1916, it was purchased by General Motors Corporation. General Motors then established the Delphi Corporation, which at one point in the carmaker’s history, was its largest parts supplier. My father worked for General Motors for over four decades.
In 2005, Delphi declared bankruptcy and decided to close or sell several facilities in our region including two plants in Dayton, as well as others in Kettering, Moraine, and Vandalia. The job loss as a result of Delphi’s insolvency was estimated to impact over 5000 jobs across the Miami Valley.
The effect of these plant closures has been felt throughout the Dayton region as many of our family members, neighbors, and friends were Delphi employees. The closure of these facilities also has an impact beyond individual job loss. Entire neighborhoods across Dayton have been affected by Delphi’s bankruptcy through increased foreclosures, and community services have been affected because of an eroded tax base.
In July, the United States Bankruptcy Court granted Delphi authority to turn over the management of its pension obligations for salaried retirees to the Pension Benefit Guarantee Corporation (PBGC). This resulted in approximately 15,000 salaried Delphi retirees from across the country taking a severe cut in their promised pension benefits. As a result, many employees faced as much as a 70 percent reduction in pension benefits and for some retirees, this news adds to the prior loss of their health care benefits.
Delphi’s bankruptcy has impacted the pension benefits of more than 1,000 salaried retirees in the Dayton region. Salaried retirees made their careers by supporting Delphi Corporation and General Motors. The treatment of these salaried retirees is troubling in comparison to the benefits received by other employees.
Delphi retirees from across the country continue to make their voices heard. Tom Rose, a former GM/Delphi salaried employee with nearly four decades of service and a leader of the Dayton chapter of the Delphi Salaried Retirees Association (DSRA), drove to Capitol Hill to attend the congressional hearing. I will continue to listen to and work with Delphi’s former employees to ensure they receive whatever benefits they were promised.
I am a co-sponsor of H.R. 3455, a bill in Congress to make available up to $3 billion in Troubled Asset Relief Program (TARP) funds to provide health care coverage for former Delphi employees and their families. This legislation is currently before the House Education and Labor Subcommittee on Health, Employment, Labor and Pensions.
With the federal government owning 60 percent of General Motors, the Obama administration should not be in the business of picking winners and losers with respect to retirees’ benefits. Delphi’s former employees deserve equitable treatment, regardless of whether they are union or non-union workers. They should not be treated differently in their retirement and the administration has an obligation to these men and women to find a solution in this matter.