Thread regarding 3M layoffs

What happens to 3M pension program if it break apart?

While I believe (perhaps foolishly) that we retirees who have put in 30 plus years of dedicated service will still have our pensions to draw from, what happens, if many suspect and if WS gets its way, 3M is broken into 4 or 5 or even 6 companies.

Pensions typically get assigned to one entity because managing one pension across multiple companies has a lot of conflicts. So...just looking at what happened when some other companies broke apart. The worst case scenario was when monsanto broke into pieces in the late 1990s. They created a "new" monsanto with no pension liabilities and lumped everything into a "successor to monsantos other businesses" called solutia. Of course, solutia went into bankruptcy protection and then pensioners got lumped into PBGC, a government entity, and people got screwed and lost almost half of their promised pension. Then GM did the same and the new GM screwed non UAW retirees the same way.

Sad to say, I see the same happening here.

Has anyone checked into this?

Note: bankruptcy of a subsidiary assigned the old company's pension won't save your from going to the PBGC fund.

Ps I can see Mike and Monish doing this to "enhance shareholder value" of the HCBG.

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| 2642 views | | 9 replies (last May 7, 2023) | Reply
Post ID: @OP+1mu3JrpP

9 replies (most recent on top)

I'm surprised 3M didn't freeze the pension years ago like so many other companies did. I still think it's just a matter of time. Question is how will it end? Would 3M buy a group annuity to transfer the responsibility for future pension payments to an insurance company, or would they just freeze it and maintain responsibility for paying the current (frozen) amount of vested monthly benefits?
In the first case, would 3M offer employees a one-time choice to take a lump sum or just force everyone into the monthly annuity through the insurance company? This comes with a risk that the insurance company could have financial trouble and be unable to make payments.
In the second case, there is the risk of 3M financial trouble and takeover by PBGC as discussed on this board.
With the significant reduction in lump sum amounts effective January 1st, there aren't any good choices left.

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Post ID: @1kaz+1mu3JrpP

Pension will go away in 2024.

There is no way that the remain co with diminished revenues and profits plus enormous legal liabilities will be able to continue to contribute to a defined pension plan. Just be realistic.

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Post ID: @rry+1mu3JrpP

I looked at the pension from multiple angles, researched other companies, learned about PBCA, and spoke with several trusted financial advisors. 3M also clearly states that benefit programs can change at any time for any reason. My conclusion was that I couldn't trust the pension and security of my family through retirement years to 3M. I trust myself to manage my future. Therfore I retired and took the lump sum in Nov.2022 before the 417e segment interest rates wiped out 15 %. For those currently facing this situation do your homework and your own risk analysis. The decision in some ways is more complicated because lump sum is reduced. However the long term security of a 3M pension is also becoming more clear that it is a real risk.

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Post ID: @jhj+1mu3JrpP

Imation was dead in the water from its inception. Thankfully I didn't get drafted (they placed memos upside down on your desk to tell you that you were going to newco, which was imation). 3M actually charged imation an arm and a leg rent to use their buildings until imation wasted millions for a lovely building in oakwood what was never full and later sold off for maybe 20 cents on the dollar.

Sorry for those who gave a long career to 3M only to get imation-ed away. Funny thing was about 10 years ago I helped clean out an old storage room and found a box of imation disc's still sealed. Desi probably saved 3M a few billion by spinning it off and avoiding having to pay 10k hapless cast-offs a severance.

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Post ID: @lbu+1mu3JrpP

I’ve been through this before with 3M.
In the summer of 1996 , I was spun off to Imation reluctantly after 28 years with 3M. The pension carried over, but was reduced 15% to cover expenses over a smaller pool of employees. But the time I was ready to retire, Imation was essentially bankrupted and the pension was sold to lowest bidder to manage. My pension was reduced to 1/3 of its original value. Lump sum was not available at that time.

As far as the executives, they don’t get a pension . Instead they get equity stake. Worth way more than a pension. Stock is given to them, it’s not a stock option. So even if the stock price goes down, it’s worth less, but far from worthless if it’s simply handed to you. Also, executives have at least 7 income streams available to them. 3 Bonuses, 1 options, 1 grant, 401k, one pay check. Typical factory worker get a paycheck and 401k, and maybe a bonus.

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Post ID: @syq+1mu3JrpP

If 3m files bankrupt then they will sc--w you on your pension.

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Post ID: @rxa+1mu3JrpP

Has anyone else noticed one off down votes? It’s like a senior leader or someone in HR downvotes but doesn’t actually contribute anything meaningful ;)

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Post ID: @aog+1mu3JrpP

Not sure it’s true but I was told by someone in SMO that spin-off won’t be offering any type of pension scheme for those not already currently vested. Employees will also incur more of the benefits expenses than they did in old 3M. You’ll pay more out of pocket for less. Hope this is not true. HR is it true?

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Post ID: @aiq+1mu3JrpP

Monish doesn't have a 3M pension since he's a recent hire. He is going to be the HCBG CEO so it makes sense for him to want to deep six pensions into a bankrupted spinoff.

Man why did this company destroy itself????

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Post ID: @yzv+1mu3JrpP

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