Boeing Change to Retiree Health Benefits Gets Court
Approval
September 14, 2009 (PLANSPONSOR.com) - The U.S.
District Court for the Northern District of Illinois has
found that Boeing Co. did not violate the Employee Retirement
Income Security Act (ERISA) or the Labor Management Relations
Act (LMRA) when it presented changes to retirees' health
benefits in a 2006 collective bargaining agreement
(CBA).
The court rejected the UAW's argument that benefits
as set out in previous CBAs were vested and could not be
changed. According to the opinion, previous CBAs stated the
benefits would be provided "for the duration of the
Agreement."
Union officials said there was no language in the
agreements because there had always been an understanding
between the union and the company that the benefits would
be provided to retirees and their beneficiaries for
life.
In addition, the court found there was nothing in the
CBAs that restricted Boeing's right to make changes to
its retiree health benefits, and that since the CBAs
required that Boeing provide the retirees with the same
coverage as that provided to active employees, Boeing could
make changes to retiree benefits that put them in line with
those of active employees without violating the CBAs.
The CBAs at issue in the case covered employees and
retirees of Boeing Rotorcraft.
The 2006 CBA made changes to medical plan options, and
increased deductibles, copayments, and benefit payment
levels. It also froze the amount of Medicare Part B premium
reimbursement provided per month for eligible retirees and
dependents.
The opinion in Boeing Co. v. March is
here
.
Rebecca Moore
editors@plansponsor.com