GOP Health Negotiations Cited in Win for Honeywell Retirees

Employee Benefits News examines legal developments that impact the employee benefits and executive compensation employers provide, including federal and state legislation, rules from federal...

By Jacklyn Wille

Honeywell International Inc. must reinstate health benefits for a group of workers who retired from the company’s Stratford, Conn., plant ( Kelly v. Honeywell Int’l, Inc. , 2017 BL 222118, D. Conn., No. 3:16-cv-00543-VLB, 6/27/17 ).

In temporarily undoing the benefit cuts, a federal judge said June 27 that “the availability of health care coverage is now uncertain” given the health-care bills recently proposed by both House and Senate Republicans. The judge specifically cited the Congressional Budget Office analyses of both the American Health Care Act of 2017 and the Better Care Reconciliation Act of 2017, which said the bills would cause the number of uninsured individuals to grow in 2018 by 14 million and 15 million, respectively.

The judge’s decision is a partial reversal from her earlier ruling that Honeywell’s obligation to provide health benefits for the Stratford retirees varied based on when a specific worker retired. Although the judge has maintained that the company must provide benefits to workers who retired while a particular bargaining agreement was in effect, she previously ruled that workers who retired more recently weren’t entitled to lifetime benefits. Last month, the judge said she would reconsider this loss for the latter group of retirees, and in her most recent ruling, she issued an injunction forcing the company to reinstate their benefits while the dispute was pending.

The decision is the latest development in Honeywell’s efforts to cut lifetime health benefits for its retirees. Honeywell’s 2015 announcement to end retiree health benefits was followed by at least three other lawsuits in Ohio and Michigan, which received mixed results. A federal judge in the Northern District of Ohio approved the cuts, while a federal judge in the Southern District of Ohio found the cuts invalid. In January, a federal judge in Michigan entered a preliminary injunction barring Honeywell from cutting health benefits for retirees of a Boyne City, Mich., plant.

In ordering Honeywell to reinstate the Stratford retirees’ benefits, Judge Vanessa L. Bryant of the U.S. District Court for the District of Connecticut said the retirees would experience “irreparable harm” in the absence of the injunction. She pointed specifically to a retired couple whose prescription drug expenses would increase by at least $12,000 per year without employer-provided coverage.

Bryant added that the balance of factors “tips decidedly in favor” of the retirees, because Honeywell hadn’t shown how continuing to provide the benefits it provided for nearly two decades would constitute a “hardship.”

Livingston Adler Pulda Meiklejohn & Kelly and Law Office of William Wertheimer represent the retirees. Morgan, Lewis & Bockius represents Honeywell.

To contact the reporter on this story: Jacklyn Wille in Washington at jwille@bna.com

To contact the editor responsible for this story: Jo-el J. Meyer at jmeyer@bna.com

Copyright © 2017 The Bureau of National Affairs, Inc. All Rights Reserved.

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