JAL to seek retiree approval for pension cuts by Jan 12

Japan Airlines (JAL) has set a deadline of January 12 for securing approval from retirees for proposed cuts to their pension benefits, a key step for the carrier to receive aid for restructuring, sources close to the matter said.

The struggling airline will send letters to the retirees next week seeking their consent for JAL’s pension cut plan as well as proposals on the amount of pension benefits to be reduced for each individual, the sources said yesterday. As the pension cuts are viewed as a prerequisite for the airline to gain access to a broad government financial package, JAL is aiming to obtain consent from more than two-thirds of the retirees.

The move follows a formal decision earlier yesterday by the airline’s corporate pension fund to cut slightly more than 30 per cent of retirees’ pension benefits and around 53 per cent of employees' pension benefits. The retirees will be asked whether they agree with the proposal and to send their replies to JAL by the deadline, the sources said.