100 retired executives from General Motors will soldier on with smaller pensions after a trio of judges in the Sixth Circuit Court of Appeals in Cincinnati, ruled in favor of the automaker. The dispute stemmed from the requirements made by the Obama administration as part of GM's bankruptcy and restructuring, according to a report from The Detroit News.
The gist of the suit is that the former execs thought their pensions were being calculated one way for the purpose of the cuts, while the automaker was actually counting a different way, with GM factoring in a salaried retirement plan into the executive retirement plan. The judges in the appeals case sided with a 2011 ruling by US District Court Judge George Caram Steeh.
One of the conditions for the bailout was that GM needed to trim all executive pensions worth over $100,000 per year by up to two-thirds. Not surprisingly, some execs weren't pleased about this. As The Detroit News notes, former CEO Rick Wagoner saw his pension fall from $20 million to $8.5 million.
According to The News, trimming the pensions of the top executives alone saved $221 million per year, while overall pension and health care cuts added up to $4.6 billion in savings.