Pension Benefit Guaranty Corporation PmE UITO*B**LM-y 1200 K Street, N.W., Washington, D.C. 200054026 

SEP 0 6 2004 

Re: Case 194025, Trans World Airlines, Inc. 

(TWA) Retirement Plan for Employees - Flight Attendants 

(the IFFA Plan) ) 

The Appeals Board reviewed your appeal of PBGC's July 31, 2003 

determination of your benefit from the IFFA Plan. For the reasons 

stated below, the Board granted your appeal by finding that PBGC 

should recalculate your pension benefit so as to credit you with 

the benefit you would have earned had you not been absent from work 

due to TWA's weight program in accordance with the 1995 Settlement 

Agreement signed by the Equal Employment Opportunity Commission 

(EEOC)), TWA, and the International Federation of Flight Attendants 

(IFFA). 

As a result of the Board's finding, PBGC's Insurance 

Operations Department (IOD), the office responsible for issuing 

benefit determinations, will send you a new determination of your 

PBGC benefit. 

Determination and Appeal 

PBGC determined that starting on your Actual Retirement Date 

(ARD = July 1, 2001), you were entitled to a regular monthly 

benefit of $390.35 payable as a Joint and 50% Survivor Annuity 

(J&50%SA), which provides a benefit for your lifetime and if you 

die first, your eligible spouse will receive a monthly benefit 

equal to one-half of that amount for the rest of his life. PBGC 

determined that you were also entitled to a temporary supplement of 

$205.25 from age 60 to age 62. PBGC included a Benefit Statement 

showing data that was used to calculate your benefit and also 

showing that PBGC accepted the monthly IFFA Plan benefit amount 

that TWA calculated. 

Your August 25, 2003 appeal letter stated as follows: 

"My former Company, TWA, failed to reinstate the retirement credit that I was entitled to as 

a result of a Lawsuit settlement brought by the EEOC against TWA. It was regarding a 

'Weight Program' or 'Appearance Standard Program' settled in 1992 that I was involved in. 
The period in question is August 1990 through August 1992. After the settlement, TWA had 

improperly listed my absence as a 'Personal leave' and never reinstated the time in my 

retirement credits as instructed by the Federal Courts. Therefore the figures reported to the 

PBGC by My Former Plan Administrator were flawed and incomplete, causing the incorrect 

calculation of my Pension Benefits. 

In 2000 1 asked Marsha Duncan in the TWA Retirement Department to correct this error 

before she submitted my records to the PBGC and was told that 'it was too late and after all 

it was only a small amount of time and would not matter', but it does matter to me, as this 

is all the pension I have to live on in my retirement years." 

You included a "Letter of Explanation" of the five items of 

evidence you enclosed with your appeal letter. You described the 

evidence as 

(1) "Notice of Proposed Settlement of Class Action and 

Fairness Hearing and Right to make a claim;" 

(2 ) "All the names of Los Angeles-based Flight Attendants 

that were on the weight program;" 

(3) "1990 Lost Time Tracking Record;" 

(4) "Letter of Seniority Adjustments;" and 

(5) "Updated Seniority by American Airlines." 

Discussion 

1. Background 

PBGC provides pension insurance according to the Employee 

Retirement Income Security Act of 1974, as amended (ERISA). If a 

plan sponsor is unable to support its pension plan, PBGC becomes 

trustee of the plan and pays pension benefits as defined in the 

plan subject to limitations set by Congress under ERISA. 

Records available to the Appeals Board reveal that the IFFA 

Plan terminated on January 1, 2001 and that PBGC became trustee of 

the IFFA Plan on January 2, 2001. The records also show that you 

were actively employed by TWA when the IFFA Plan terminated. 

2. Pertinent Plan Provisions 

"Continuous Employment" is defined in IFFA Plan 5 3.1. With 

respect to service before January 1, 1976, the IFFA Plan credits 

you with Continuous Service in years and completed months of fulltime continuous service with TWA. With respect to service on and 
after January 1, 1976, the IFFA Plan credits you with one year of 

Continuous Service for each year of employment with TWA during 

which you completed 2,340 Hours of Service. Section 3.1 

specifically excludes from Continuous Service any period of time 

during which you were absent from work due to a personal leave of 

absence or medical leave and were not on TWA's payroll. 

Section 1.2(h) defines "Earnings" as the regular compensation 

paid to an Employee of TWA. 

The amount of a participant's regular monthly retirement 

benefit payable at normal retirement date is defined in IFFA Plan 

5 5.1. Section 5.1 says that your regular normal retirement 

benefit is the sum of your Past Service Benefit and your Future 

Service Benefit. Your Past Service Benefit is your accrued benefit 

under the Prior Plan as of July 31, 1981. Your Future Service 

Benefit is equal to one-twelfth of 2 percent of your Earnings while 

a Flight Attendant on and after August 1, 1981 and before 

January 1, 1993. Thus, the amount of your regular normal 

retirement benefit is not affected by the specific number of years 

of Continuous Service with which you were credited after July 31, 

1981, but rather by your earnings during that period. 

Section 5.2 of the IFFA Plan provides the formula for 

calculating the temporary supplement payable between ages 60 and 62 

to all participants who earned at least ten Years of Continuous 

Employment. It states that the temporary supplement is equal to 50 

percent of your normal retirement benefit payable as a temporary 

Straight Life Annuity, which means that your survivor does not 

continue receiving the supplement if you die before age 62. Thus, 

the amount of your temporary supplement, like your regular normal 

retirement benefit, is not affected by the number of years of 

Continuous Service with which you were credited after July 31, 

1981. 

2. The Settlement Agreement 

The Appeals Board reviewed a copy of the Settlement Agreement 

and Consent Decree that was filed with the federal district court 

for the Central District of California on October 31, 1995, as well 

as the "Notice of Proposed Settlement of Class Action and Fairness 

Hearing and Right to Make a Claim" that you included with your 

appeal. 

Paragraphs 8 and 11 of the Settlement Agreement deal with the 

issue of pension credit as follows: 

"8. None of the Individuals accepting reinstatement under this Decree will be entitled to 
back pay for any matter addressed in this case. Each flight attendant who accepts TWA's 

offer for reinstatement will be provided with restoration of company and line seniority, 

including the period from the date of termination or separation until the date of 

reinstatement. In addition, each returning flight attendant will be entitled to restoration of up 

to two (2) years lost pension credit for the period he or she was terminated or separated and 

did not receive such credit. To the extent that any individual accepting TWA's offer for 

reinstatement had time left in his or her sick bank at the time of separation or termination, 

that sick time will be restored. Individuals accepting reinstatement will also be permitted to 

purchase vacation from TWA up to the number of vacation days that, had they been in active 

service during the entire preceding calendar year, they would have been eligible to take in 

the year in which reinstated, based on their seniority with TWA. TWA, in conjunction with 

IFFA, will develop a procedure for purchasing such vacation, consistent with operational 

needs. Reinstated individuals will not be entitled to any relief not specifically set forth in this 

Decree." 

"11. Any individual who was suspended under the weight program or placed on a 

mandatoryappearance leave of absence due to weight since November 1,1986 will have 

company and line seniority restored for the period he or she was suspended or on a 

mandatory appearance leave of absence. In addition, that individual will be entitled to 

restoration of up to two (2) years lost pension credit for the period he or she was suspended 

or was on the appearance leave and did not receive such credit. The Company will confirm, 

in writing, his or her seniority and pension benefits under this Decree. . . ." 

Because the Settlement Agreement did not define the terms 

"pension credit" and "lost pension credit" and specifically awarded 

no back pay, the Appeals Board reviewed files obtained from TWA, 

but found no evidence of how TWA applied these terms when 

performing benefit calculations for other IFFA participants in 

accordance with the 1995 Settlement Agreement. As noted above, 

PBGC accepted the normal retirement benefits calculated by TWA for 

IFFA Plan participants. 

The Appeals Board, therefore, contacted individuals involved 

with the 1995 Settlement Agreement regarding their interpretation 

of the term "pension credit." An attorney whose law firm 

represented IFFA said that it was his recollection that earnings 

for up to two years of service were to be imputed for purposes of 

recalculating an IFFA participant's benefit under the Settlement 

Agreement. An attorney who signed the Settlement Agreement on 

behalf of TWA said that he did not know what was meant by the term 

"pension credit." The attorney who signed the Settlement Agreement 

on behalf of the EEOC explained that, while the parties did not 

concentrate on the meaning of the term "pension credit," the 

intention of the Settlement Agreement was to make the Flight 

Attendants who were suspended whole. 
Decision 

Based on the above, the Appeals Board decided that PBGC should 

recalculate your benefit as if you had been continuously employed 

by TWA at your regular salary rate. from August 14, 1990 until 

August 4, 1992, in accordance with the 1995 Settlement Agreement. 

When PBGC's IOD receives a copy of this decision, IOD will 

send you a corrected determination letter, which will include a new 

45-day right to appeal. In the meantime, if you need more 

information about your benefit, please call the Customer Contact 

Center at 1-800-400-7242. 

Sincerely, 

Michel Louis 

Appeals Board Member