Avaya Inc., Santa Clara, Calif., is suspending supplemental benefit payments to certain retirees in its non-qualified pension plans, the company said in a statement emailed by a company spokesman.
The firm declared Chapter 11 bankruptcy on Jan. 19 and said in the statement: “Avaya continues to make qualified pension payments in the normal course during the chapter 11 process” but does not have the court's authority to make those supplemental payments.
Avaya said in the statement those payments are “an additional amount above the IRS compensation or benefit limits on qualified pension plans.”
A person familiar with the situation said supplemental payments go to management-level employees. He would not say how many management employees were affected and how much in assets this represented, but he said they are continuing to receive their qualified pension plan benefit payments.
The company reported $2.2 billion in total pension plan assets as of Dec. 31, 2015, in its most recent Form 5500 filing.