Troubled telecom company Avaya Inc. has begun cutting off some pension benefits for retirees, a signal that these benefits may be on the chopping block in connection with its chapter 11 case, the Wall Street Journal reported today. In a letter to retirees, the communications company cited its recent chapter 11 filing to say that as of Feb. 1, it would stop paying so-called supplemental pension benefits to certain retirees until further notice. Some retirees recently received notice that March checks also wouldn’t arrive. An Avaya spokesman said the company continues to pay federally guaranteed pension payments but doesn’t “have the court’s authority to make supplemental pension payments…at this point in time.” He declined to elaborate on Avaya’s plans for these benefits, which are among the liabilities that companies often shed in bankruptcy.
