The Senate bill allows airlines to take up to 20 years to fully fund their pensions, but only if they freeze benefits for their workers. The House bill contains no special provisions for airlines.

The Senate bill deems an employer's pension plan at risk of a bailout if it is funded less than 93% and if the company's debt ratings -- a measure of its ability to borrow money, similar to a credit score -- is below investment grade, or junk level. The House bill sets 60% or lower funding as the at-risk level.

The Senate bill uses a company's credit ratings as a factor in determining whether its pension plans should be considered at risk and if the company should be forced to follow stricter funding and benefit rules. GM, Ford Motor Co. and Delphi Corp. all have credit ratings of junk, or below-investment grade. The Bush administration supports the proposal, but several business groups contend credit ratings should play no role in measuring a company's pension-plan health.

Companies use interest rates to help calculate how much they will owe retirees. The U.S. House bill uses a formula favored by business groups that allows companies to use a 3-year average of corporate bonds, which smoothes out spikes and plunges in rates. The Senate bill and the Bush administration say the average should cover only 1 year for a more accurate calculation.

GM's pension plans for 460,000 U.S. retirees had a surplus of $1.5 billion at the end of 2004, but GM could be forced to shoulder up to $11 billion in guarantees for retiree pensions, health care and other costs because of Delphi's bankruptcy.

WASHINGTON -- The U.S. House of Representatives has approved a bill reworking federal rules governing pension plans for about 44 million U.S. workers and retirees.

The House bill, which had the support of the UAW and General Motors Corp., now must be reconciled with a version that passed the U.S. Senate carrying several provisions that would increase the financial strain on GM, Ford Motor Co. and Delphi Corp. Action is expected by April.

The House bill also lacked a key provision that bankrupt airlines, including Northwest Airlines have said could save them from ditching their pension funds covering thousands of workers.

The bills are designed to force companies to keep enough money in their pension funds to match their obligations to retirees, and to contribute more to the Pension Benefit Guaranty Corp., the government's pension insurance fund.

Because of a string of bankruptcies in airlines and manufacturing, the PBGC has a $22.6-billion deficit, and its administrators have warned that taxpayers could be facing a bailout similar to the savings and loan crisis of the 1980s if Congress fails to act.

The changes "will bring more funding to company pension plans, more funding to the Pension Benefit Guaranty Corp. and put our pension system for American workers on a stronger foundation," said Rep. John Boehner, R-Ohio.

"Some say the rules are too tough and are going to drive the employers out of the pension business, while some are saying the rules aren't tight enough," he added. "I think the rules are just right."

The bill passed the House by a 294-132 vote, with 70 Democrats voting for the bill and one Republican vote against. All the Michigan representatives except for Democrat Sander Levin voted for the bill.

Democrats said the bill makes it too easy for companies to declare bankruptcy and throw their pension plans onto the PBGC with few penalties, further weakening the PBGC's finances.

"The steel companies did it, the airlines have done it, and there's a question of whether the auto companies will go this way. Shouldn't there be something that companies have to exhaust to save the retirement plans of Americans?"

Earlier this week, the UAW joined a long list of business and labor groups supporting the bill after Boehner and other sponsors agreed to two changes that could have hit autoworkers.

Several House members decried any help for the teetering airline industry in the House version of the bill. The Senate version allows airlines to take up to 20 years to close the funding gaps in their pension plans; the House bill forces airlines to use the same 7-year catch-up schedule as other companies with underfunded pensions.

Boehner and other backers said the airlines' concerns could be addressed in the conference committee with the Senate. Lawmakers are aiming to pass a unified bill by April, when companies will be required to make payments to their pension plans.

President George W. Bush has "made clear that he was not going to sign anything that would weaken our pension system," spokesman Scott McClellan told reporters Wednesday.

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