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From: Lou Dietrich [mailto:ldietrich@cv.net] Sent: Friday, September 10, 2004 8:35 AM To: pfrusso@lucent.com Subject: FW: Legacy Issues Ms Russo! I take great exception to being called a "legacy issue" by your CFO. "Lucent Technologies Inc.'s chief financial officer gave rough targets for the company for the next several years, saying the telecommunications-equipment maker's financial performance has stabilized. The finance chief, Frank D'Amelio, also said the company must reduce its retiree-benefit costs. "Spending levels have to come down," he said. "Most of our competitors don't have these legacy issues."" Does he not remember when we "legacy issues" made billions for LU?...only to be squandered by over paid LU executives!.... We retirees deserve an apology from you and your CFO...and demand more respect for those families who allow you drawn your excessive salaries. L. (Lou). E. Dietrich
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From: Russo, Patricia (Patricia) [mailto:pfrusso@lucent.com] Sent: Tuesday, September 14, 2004 5:54 PM To: 'Lou Dietrich' Subject: RE: Legacy Issues Dear Mr. Dietrich, I received your email. No harm or disrespect was intended as Frank D'Amelio discussed the issues confronting Lucent for post retiree health care. As you know, it is an issue for the company given the rising costs and the fact that the total retiree health care cost represents about 10% of revenue; this is not affordable for a company our size. The use of the word "legacy" is not aimed at describing our retirees, it characterizes this as an issue resulting from previous policies as we no longer provide retiree health coverage for any employees with less than 15 years service, so any new hires have no retiree health coverage. I apologize if you are offended. It was not intended. Pat Russo ----------------------------------------------------------------------------------------------- Thank you for the apology. It is warmly received. While I realize you are struggling to keep our LU afloat, you also must realize that we must keep our family life afloat. There are retirees who rely entirely on their retirement fund and can not afford any increase in healthcare costs or decrease in benefits. They, we, are fighting to make ends meet. Most retirees wish LU well in it endeavors...but not at the expense of our retirement accounts. Your retirement plan people can give you the figures on the average retiree's monthly check. The retiree life is one of trying to make very basic ends meet, based on what they were told would be their benefits. Every company should value the contributions of their former employees...those "previous policies" as you mentioned were promises made by the Company in exchange work provided by the employee. It was part of the total compensation package, which WE, AT&T, and LU took pride in exhibiting. Now those promises are being broken...and those fiduciary accounts have been depleted by repeated "raids" (albeit legal) to cover current operating margins. Executive Compensation has been based on operating results and the retiree accounts have been retentively used to bolster these results. Maybe it is time that Executive Compensation contributes back into those accounts? Those previous policies, as you described them, as onerous as they may now seem to you, were earned!...Earned by waking up everyday and putting in solid labor hours...protecting Company assets as they were our own...making sure every last dollar was billed to our customer...and them making sure we booked those dollars. Those "previous policies" were compensation for long hours of devoted work. Please stop looking at your retiree benefits as a simple source of current funds....these are dollars earned by the retirees...for the retirees...not as a subsidy for current results. Again, thanks for the apology. L. (Lou). E. Dietrich |