White collar pension plan frozen by GE

Decision expected to affect 20,000 people, cut debt by $ 4B to $ 6B

General Electric Co. on Monday announced that it was freezing the pension plan that covers 20,000 white collar employees in the United States as part of an effort by CEO Larry Culp to trim billions of dollars in debt that has been slowing down the industrial conglomerate.

GE says t he move will reduce the company’ s pension deficit by $ 5 billion to $ 8 billion and reduce t he company ’s debt by $ 4 billion to $ 6 billion.

GE employs about 4,000 people in the Capital Region, most of whom work at GE’S Schenectady campus in GE Power and GE’S renewable energy business.

Others work at GE’S global research center in Niskayuna and at a GE Healthcare facility that makes digital X-ray machines in North Greenbush.

A company spokesman on Monday wouldn’t reveal how many Capita l Reg ion workers would be affected by the pension freeze. GE also is freezing supplementary pension benefits to about 700 top executives.

Those GE retire es who already receive benefits won’t be affected by the changes. Neither will union employees, whose pension benefits are dictated by existing labor contracts. GE

had a lready closed dow n its pension prog ra m to new employees in 2012.

“Returning GE to a position of streng t h has required us to make severa l dif f icult decisions, and today ’s decision to f reeze t he pension is no exception,” Kev in Cox, GE’S chief human resources of f icer, sa id in a statement. “We caref ully weig hed market trends and our strateg ic priorit y to improve our f ina ncia l position with t he impact to our employees. We are committed to helping our employees t hroug h t his tra nsition.”

GE is a lso ta king a por tion of $ 38 billion it received in t he sa le of various businesses recently to f und bet ween $ 4 billion and $ 5 billion in pension pla n requirements for 2021 and 2022.

GE is a lso of fering a “lump sum” pension payout to 100,000 former employees who have not sta r ted receiving t heir monthly pension pay ments.

“Notices will be prov ided to elig ible par ticipa nts, and t hose who elect to receive a lump sum should ex pect to receive it in December 2019,” t he company sa id in a statement.

In order to make up for f reezing t he pension, GE will make direct and matching contributions to employees’ 401( k) accounts.

Sen. Charles Schumer, who was in t he Capita l Reg ion Monday, was critica l of t he pension move.

“I t hink t hese fol ks work long and hard, and I’m rea l ly disappointed t hat Genera l Electric is f reezing t he pensions of 20,000 people across t he countr y. Obviously ( it) will a f fect people here,” Schumer said. “It ’s sor t of, it ’s brea k ing a promise.”