Corporation 

20005-4026 

January 27, 2005 

Re: 1 

Eastern Airlines, Inc. Fixed Benefit Retirement Income 

Plan for Pilots (the "Plan") 

Dear 1 1 

The Appeals Board has reviewed your October 12, 1998 appeal of 

PBGC' s determination of benefit. We apologize for the 

delay in responding to your appeal. 

As explained below, we are denying your appeal by finding= 

disability benefit is not in PC3. 1 However, PBGC has 

determined rl will continue to receive the $1,771.48 per 

month beneflt he is currently receiving, and he will not be 

required to repay his past overpayments. 

PBGC's Determination 

PBGC's August 30, 1998 letter explained Plan 

disability benefit is $3,212.06 per month, the same as Eastern 

paid. PBGC found: 

sick leave was exhausted November 15, 1987, and 

Because the Plan's termination date was less than 3 years 

later, October 5, 1990,hisabilit~ benefit 'did not 

fall into PC3. Instead, the non-guaranteed portion of his 

disability benefit is in PC5. 

Under an ALPA-PBGC Settlement Agreement, PBGC would pay 

34% of his PC5 benefit. Therefore, PBGC calculated 

PBGC 

through December 

benefit as $1,759.28 

31, 1998 as 

per month, 

$17,029.75. 

and his overpayment balance 

a 

Your Appeal 

You noted the Plan's disability pension starts after sick 

leave has been exhausted. Thus, the Plan incorporates the sick 

leave rules under Eastern's contract with ALPA (the 'Contract"). 

You claim that under the Contract: 

(i) should have been allowed to use sick leave 

instead of scheduled vacation leave in 1986 and 1987, 

Priority Category 3 defined in ERISA section 4044(a) (3) 
(ii) He should not have earned sick leave while being paid 

sick leave, and 

(iii) Even if the Contract required sick leave accruals while 

on sick leave, accrual rate after August 1986 

should have been 1% days instead of 3 days per month. 

If Eastern had followed the Contract, you argue, 

leave would have ended before October 1987. You 

is eligible for a fully-funded PC3 benefit. 

Data Relevant to Your Appeal 

1 Start of first extended sick leave: 1 10/20/1984 

3 .days Final sick leave accrual rate: 

per month 

I Date final 3-day accrual rate started: 1 3/31/1985 2 

returned to work (on training, 

Exhibit 4 page 10) : 

/ 4/03/1985 

Largest post-4/03/1985 sick leave balance, on 

7/31/1986 (Exhibit 4 page 34): 156% hours 

Last day of work: August 1986 

Date paid sick leave was exhausted: 11/15/1987 

1 Date disabilitv pension started: 1 12/01/1987 

Convertins Paid Vacation to Sick Leave 

You cite a Contract provision for charging sick leave to a 

pilot who cannot fly "while on sick leave."3 You have only 

described a consequence if had been on paid sick leave. 

You have not demonstrated any requirement for converting scheduled 

vacation to paid sick leave. Therefore, the Board denied your 

request that 1986 and 1987 paid vacation be converted to paid sick 

leave. 

3/1/85 sick leave balance 138% - 15 + 3 = 126% days on 

3/31/85. See pages 7 and 9 on your Exhibit 4. 

' Your Exhibit 5, section 38(D), page 160 
Sick Leave Accrual Rate 

You asked the Appeals Board to change how Eastern applied to 

the following Contract provision : 

"A pilot shall be credited with one and one third (1%) 

days of sick leave for each month of service with 

Eastern. . . . When a pilot returns to duty after an 

extended sick leave that reduces his sick leave balance 

by thirty (30) days or more, he shall be credited with 

three (3) days of sick leave for each month of service 

thereafter until his accumulated sick leave is restored 

to the extent used to the balance that existed 

immediately prior to the period of extended sick leave." 

(italics added) 

Your arguments below for changing sick leave accrual rates depend 

on the meaning of "service." Service is not defined in the 

Contract, but is defined in the Plan document. 

Service for Earning Sick Leave Includes Paid Sick Leave 

Your a peal equates the Contract's term "service" with "work." 

Since was not working while absent on paid sick leave, 

you argue he was not earning the service needed to accrue sick 

leave. 

Contrary to your interpretation of 'service, " the Plan defines 

Active Service to include "sick leave with pay.,14 Similarly, an 

unsigned 1986 ALPA-Eastern agreement defines Active Status to 

include employees on paid sick leave. See Enclosure 2. Further, 

Eastern granted sick leave accruals to 1 and another 

participant who submitted flight logs to PBGC. Thus, other 

relevant documents and Eastern's practices indicate paid sick leave 

is service used to accrue sick leave. Therefore, the Board will 

not change Eastern's practice of including paid sick leave in the 

service used to earn sick leave. 

Contract Plainly Required Final 3-Day Accrual Rate 

You have agreed that in Spring 1985 satisfied the 

Contract's requirement for the 3-day accrua ra e to "return to 

duty." The Contract then required continuing the 3-day accrual 

rate "thereafter" until his approximately 185-hour sick leave 

balance was restored. However, sick leave balance 

never again approached 185 days. See the table above. Thus, the 

Contract plainly required continuing the 3-day accrual rate from 

Spring 1985 until retirement, the same as Eastern 

granted. 

Plan section 1.2 (i) . See Enclosure 1 
Argument for Reducing Sick Leave Accruals While on Sick Leave 

You have questioned the plain reading of the Contract we 

applied in the paragraph above. Under the plain reading, after 30 

days on sick leave a participant could increase his accrual rate 

from 1% days to 3 days by returning to duty for only 1 day. You 

describe this result as "bizarre." You propose instead that the 3- 

day rate applied only while a participant was working. 

We rejected your 'bizarre result" argument for the following 

3 reasons: 

The Board found no ambiguity in the Contract's requirement 

that after activation, the 3-day per month accrual rate 

continues "thereafter until his accumulated sick leave is 

restored. . . ." 

Even if under the plain reading of the contract it was 

bizarrely easy to trigger a 3-day accrual rate, the more 

reasonable contract reinterpretation would be to apply the 3- 

day accrual rate automatically after 30 days on sick leave 

without requiring any return to work. Thus, the more 

reasonable remedy would be the opposite of what you propose. 

Even if the contract were ambiguous as to which accrual rate 

applies, or if the Contract could have been written 

differently, the Board must defer to the contemporaneous 

interpretations of the responsible parties: 

(1) Eastern granted the same 3-day sick leave accruals 

while on sick leave to another participant who submitted 

flight logs to PBGC. 

(2) We found no evidence that ALPA or disagreed 

with Eastern granting 3-day per month sick leave accruals 

while on sick leave, even when was carefully 

planning his disability retirement. Please see Enclosure 

3. 

Therefore, the Board decided not to change how Eastern applied the 

Contract's sick leave accrual rules toy1 

RecouDment 

PBGC has decided not to reduce current $1,771.48 

estimated benefit and not to seek repayment of his past 

overpayments. He will not be required to repay his overpayments. 

Decision 

Having applied Plan and Contract provisions to the facts in 

this case, we are denying your appeal. However, PBGC will continue 

paying $1,771.48 per month. 
This letter concludesadministrative remedies with 

respect to PBGC's August 30, 1998 determination. He may, if he 

wishes, seek court review of PBGC's determination with respect to 

the issues you raised. If you or have any questions 

about his benefit, please contact PBGC's Authorized Plan 

Representative at 1-800-400-7242 extension 2200. Thank you for 

your patience while we carefully reviewed your appeal. 

Sincerely, 

William D. Ellis 

Appeals Board Member 

Enclosures: 

1) Excerpt from Plan document effective January 1, 1985 

(4 pages) 

2) Excerpt from unsigned ALPA-Eastern agreement negotiated in 

1986 (5 pages) 

3) attorney's September 23, 1987 letter to Eastern 

cc: 1