Q: Because the “COLA” is going away and being replaced with the Longevity Premium will I lose money?
A: NO. The COLA (real name: Profitability Bonus) for those with over 17 years of service does not compensate as well as the Longevity Premium. Also, the COLA only pays out when the company is profitable. The Longevity Bonus is paid on all Worked TFP regardless of the company’s performance.
But what does the reality look like? Below is a table with 5 actual comparisons – names withheld. COLA paid out in 2014 and what the FA would have received if Longevity Premium was in place. Because the more senior you are, the greater your Longevity Premium, the greater the difference.
|FA||DOH||Years of Service||TFP (minus SL and Vac)||COLA||What Longevity Premium would have paid out|
|A||05//1979||35||1001.2||$ 676.81||$ 4.004.80|