18th Annual Workplace Class Action Report - 2022 Edition

Annual Workplace Class Action Litigation Report: 2022 Edition 629 plan language. For these reasons, the Eleventh Circuit affirmed the District Court’s ruling granting Defendant’s motion for summary judgment. Local Union 97, IBEW, et al. v. NRG Energy, Inc., 2021 U.S. Dist. LEXIS 179434 (N.D.N.Y. Sept. 21, 2021). Plaintiff, a union, commenced this action against Defendants seeking to compel arbitration of a dispute under collective bargaining agreements. Defendants filed a motion to dismiss, which the Court granted. In September 2003, while negotiating a new collective bargaining agreement, the parties agreed to various retiree benefits for employees and future employees, and set forth the terms of that agreement in a memorandum of agreement ("the 2003 MOA"). Id . at *2. Relevant to their dispute, the 2003 MOA stated that “Current employees will be grandfathered as to their participation in life insurance Plan A or Plan B at retirement" and "employees hired after September 30, 2003 will not be provided with a life insurance benefit upon retirement." Id . The parties thereafter executed a new collective bargaining agreement, effective October 1, 2003 through September 29, 2007 ("the 2003-2007 CBA"), which stated: "Employees hired after September 30, 2003 will not be provided with a life insurance benefit upon retirement." Id . Subsequently, the parties executed collective bargaining agreements with effective dates of September 30, 2007 through September 24, 2011 ("the 2007-2011 CBA"); February 25, 2011 through September 24, 2013 ("the 2011-2013 CBA"); September 25, 2013 through March 24, 2016 ("the 2013-2016 CBA"); and March 24, 2016 through September 21, 2019 ("the 2016-2019 CBA") containing the same life insurance provision. Id . at *2-3. The current collective bargaining agreement was effective September 22, 2019 through September 21, 2023 ("the 2019-2023 CBA"), and the key provision was amended to read: "Effective November 1, 2019 the retiree life insurance benefit for employees hired prior to September 30, 2003, will be a lump sum of $10,000.” Id . at *4. The provision applied to employees employed under the 2019-2023 CBA who were hired prior to September 30, 2003, and who did or will retire on or after November 1, 2019, and did not apply to retirees who were hired prior to September 20, 2003 and retired before November 1, 2019 ("the Pre-2019 Retirees"). Defendant notified Pre-2019 Retirees that, effective January 1, 2021, their life insurance benefits would also be changed to a lump sum of $10,000. Id . at *8. The Court held that the dispute before it related to the Pre-2019 retirees’ life insurance benefits, and the 2019-2023 CBA did not affect the Pre-2019 retirees’ life insurance benefits. Accordingly, the presumption of arbitrability did not apply to the 2019-2023 CBA, as the present dispute did not arise out of the 2019-2023 CBA. Id . at *11. Plaintiff contended that the 2003 MOA "supplemented" the Prior CBAs and was therefore effectively an arbitrable side agreement. Id . at *12-13. The Court disagreed. It noted that even under a broad arbitration clause, as was present here, a collateral matter must "implicate issues of contract construction or the parties’ rights and obligations under it" to be subject to arbitration. Id . at *15. The Court ruled that there were no issues of contract construction present here, as both parties agreed to the effect of the 2019-2023 CBA Life Insurance Provision. Finally, the Court held that there was no vested right to "lifetime" life insurance benefits for the Pre-2019 retirees and, thus, there could be no enforcement of those rights through arbitration under any of the prior CBAs. Id . at *19. The Court also determined that the prior CBAs and the 2003 MOA did not indicate for how long the Pre- 2019 retirees’ benefits would be "grandfathered" and therefore neither the 2003 MOA nor prior CBAs indicated that the Pre-2019 retirees’ "grandfathered" benefits would survive the expiration of any of the other prior CBAs. Id . The Court thereby denied Plaintiff’s motion to compel arbitration. Michigan Education Association Family Retired Staff Association, et al. v. Michigan Education Association, 856 Fed. App’x 580 (6th Cir. 2021). Plaintiffs, a group of current and former employees of several related organizations, sought a preliminary injunction to stop changes to their retirement plans on the grounds that the benefits were vested. The District Court denied the injunction. It found that Plaintiffs were unlikely to succeed on the merits of their case. Plaintiffs contended that Defendants expressly committed to providing lifetime benefits by writing in a signed Letter of Understanding, (“LOU”), a separate enforceable contract from the collective bargaining agreement (“CBA”), and further, that the commitment was stated in the medical plan retirement documents that retiree insurance benefits become vested for participants who satisfied the necessary age and service conditions. The LOU stated that "The parties acknowledge that retiree fringe benefits described in Schedules A and B become vested for life on commencement of monthly retirement benefits under the MEA/MESSA/MEDNA/MEA-FS Staff Retirement Plan and Trust." Id . at 583. Plaintiffs contended that the LOU was an enforceable contract, separate from the CBAs, that established that healthcare benefits vested. Id . Instead of addressing the contract formation question, the District Court asked only whether the LOU was extrinsic evidence that proved that the relevant CBA between the parties vested employees’