Delphi Corporation is a "Tier 1" supplier that provides parts and components directly to vehicle manufacturers; GM is Delphi's largest customer. The Pension Benefit Guaranty Corporation (PBGC) assumed responsibility for Delphi's defined benefit (DB) pension plans. Some union workers whose pensions have been reduced by the PBGC may be receiving supplemental "top-off" benefits provided by GM. GM honored these "top-off" agreements when Delphi's pensions were terminated. In general, the hourly workers were union members whereas the salaried workers were not. When an insured DB pension plan has insufficient funds and cannot pay all of the promised benefits to the workers, the plan may be "terminated" and the retirees receive their benefits from the Pension Benefit Guaranty Corporation (PBGC). Not all underfunded pension plans are trusteed by the PBGC. Major Events of Delphi Pension Plans Since 1999

		Pension Benefits and the Delphi Spin-Off

As part of the spin-off in 1999, GM continued to pay the pension benefits to workers who retired prior to October 1, 2000. These agreements obligated GM in the event of a termination of the Delphi hourly pension plans to supplement the benefits for workers who received the statutory maximum benefit from the PBGC. Salaried employees did not have similar agreements in place. On September 14, 2009, the Delphi Salaried Retiree Association (DSRA) filed a lawsuit against, among others, the PBGC, the U.S. Treasury Department, and the Presidential Task Force on the Auto Industry. Some of the DSRA's claims include
the termination of the Delphi Retirement Program for Salaried Employees was in violation of the Due Process Clause of the Fifth Amendment to the U.S. Constitution; the termination of the Delphi Retirement Program for Salaried Employees was in violation of ERISA; and the agreement between GM and the unions representing hourly employees to "top-off" the hourly employees' pensions was a violation of the Equal Protection Clause of the Fifth Amendment to the U.S. Constitution.
The Delphi Corporation is a parts and components supplier to auto makers that was created in 1999 as a spin-off from General Motors (GM). In May 2009, the pension plans of Delphi were terminated and responsibility for the payment of benefits to plan participants was turned over to the Pension Benefit Guaranty Corporation (PBGC), which is a government-run corporation that insures private pension benefits for workers in defined benefit (DB) pension plans. Although most workers in pension plans that are terminated by the PBGC receive their promised benefits, some workers may receive less than their full benefit. The PBGC may not pay an individual more than a statutory maximum benefit.
In 1999, GM and some unions representing Delphi workers negotiated an agreement as part of the spin-off. GM agreed to provide the workers covered by the agreements the difference between the benefits earned under the plan and the maximum that the PBGC would pay if the pension plans were terminated. Some union workers and the non-union-salaried employees of Delphi did not have such a "top-off" agreement. Some contend that GM honored the top-off agreement under pressure from the Presidential Task Force on the Auto Industry and that the Delphi pension plans were terminated to facilitate restructuring in the auto industry. A group of former Delphi salaried employees has filed a lawsuit against the PBGC.
This report provides background on Delphi Corporation, relevant pension law, the role of the PBGC, a description of major events at Delphi since 1999, and a listing of congressional hearings and legislation introduced related to the Delphi Corporation since the 111th Congress.