WASHINGTON, D.C. – U.S. Sen. Sherrod Brown (D-OH) and to Rep. Tim Ryan (D-OH) wrote to President Obama today calling for his intervention on behalf of the Delphi retirees who stand to lose a substantial portion of their pensions in the aftermath of the Delphi and GM bankruptcies. Brown requested that the federal government, as a 60 percent shareholder in the new General Motors, bring GM to the negotiating table to work out a fair solution for the Delphi retirees.

“The auto industry helped build America’s middle class,” Brown and Ryan wrote in the letter to President Obama. “Now, the very people who built GM through their labor are facing the prospect of losing the middle class retirement that they earned over a lifetime of service.”

Later today, Brown will join his colleagues to introduce legislation which would curb abuses that deny employees and retirees of their pensions when businesses collapse. The Protecting Employees and Retirees in Business Bankruptcies Act would make several changes to Chapter 11 bankruptcy law, emphasizing worker and retiree interests when companies file for bankruptcy.

Brown and Ryan led a bipartisan group of nine Senators and 24 Representatives from Ohio, Iowa, Michigan, Mississippi, and New York in calling for the federal government to restore fairness for Delphi retirees and minimize the economic effect of the pension loss on their communities.  

Delphi was created in 1999 as a spinoff from GM, and most Delphi employees spent two-thirds of their careers as GM employees. When Delphi entered bankruptcy protection in 2005, many long-term employees were forced into early retirement as part of the restructuring agreement. Early retirement or supplemental benefits are not guaranteed by the Pension Benefit Guaranty Corporation (PBGC), and as a result, many of these Delphi retirees are at risk of losing a substantial percentage of their pension income. 

Sen. Brown and Rep. Ryan invited a representative of the Delphi Salaried Retirees Association to testify before the Senate Health, Education, Labor, and Pensions Committee (HELP) in October 2009.  In December 2009, Sen. Brown and Rep. Ryan testified on behalf of the Delphi retirees before the House Health, Employment, Labor, and Pensions Subcommittee (HELP). 

In September, 2009, Senator Brown introduced companion legislation to Rep. Tim Ryan’s (D-OH) bill that would create a Voluntary Employees Beneficiary Association (VEBA) to provide health coverage to Delphi and union hourly workers.

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