Nortel strikes deal on pensions, disability
Last Updated: Monday, February 8, 2010 | 10:47 PM ET
The Canadian Press
Nortel Networks Corp. has reached a deal with its pensioners and employees on long-term disability.
Under the deal, which requires court approval, Nortel said Monday it will continue to administer its negotiated pension plan and its managerial and non-negotiated pension plan until the end of September, when a new administrator will be appointed.
The insolvent maker of telecommunications gear will also continue to make current-service and special payments it has been paying through March 31. It will then make only current-service payments until the end of September.
Nortel also said it will pay income benefits to long-term disability beneficiaries and to those receiving survivor income benefits and survivor transition benefits through Dec. 31.
Medical and dental benefits to Nortel pensioners and survivors and Nortel LTD beneficiaries will be paid until the end of the year. Life insurance benefits will also continue unchanged until Dec. 31.
The deal came after the Ontario government said Sunday it will pay into its Pension Benefits Guarantee Fund so that Nortel pensioners will be able to receive up to $1,000 per month.
