Nortel to Thin Ranks

Nortel (NT Quote) will end its traditional pension plan and eliminate about 1,100 jobs as the Canadian telecom-gear maker continues with its cost-cutting endeavors.

The changes to the pension plan should lower annual expenses by $100 million starting in 2008 and produce savings of more than $400 million in cash by 2012.

Starting Jan. 1, 2008, Nortel said employees currently in defined-benefit pension plans will be switched to defined-contribution retirement programs. Post-retirement healthcare benefits will be terminated for workers who aren't at least 50 and have five years of service on July 1 this year. ...