Honeywell Cleared From Covering Retiree Health-Care Benefits

Honeywell International Inc. defeated a last attempt by retired hourly workers urging the company to keep paying for their health-care coverage after July 31.

The retirees weren’t vested with lifetime health-care coverage because the collective bargaining agreements and the plan documents at issue didn’t include a promise to continue providing such coverage, a federal judge in Michigan held July 25.

The ruling means that Honeywell isn’t required to provide health-care coverage or make any minimum premium contributions related to the plan starting Aug. 1.

The judge’s ruling is another win for Honeywell in its efforts to reduce health-care costs related to its retirees and their dependents. For the past two years, Honeywell has been involved in a series of lawsuits by retirees from various facilities across the country challenging these cuts.

Earlier this year, the U.S. Court of Appeals for the Sixth Circuit handed another victory to Honeywell when it ruled that retirees from a Greenville, Ohio, plant weren’t entitled to lifetime health-care benefits for them and their eligible dependents. In the past year, the Sixth Circuit upheld Honeywell’s decision to terminate company-paid health care for nearly 1,000 Ohio retirees and reversed a district court decision forcing the company to continue paying the retirees’ health benefits while the legal dispute was pending. Federal judges in Minnesota and Connecticut have sided with retirees.

The latest case, filed by the United Auto Workers, challenged the company’s decision to cap health-care contributions for workers who retired after 2003. The decision—issued by Chief Judge Denise Page Hood of the U.S. District Court for the Eastern District of Michigan—comes four months after she held that a group of union members who retired before 2003 weren’t entitled to lifetime health-care benefits.

Provisions on retiree health-care coverage in the CBAs or the plan didn’t require Honeywell to provide retirees with health-care benefits after the labor contracts expired in 2016, Page said. “The language addressed the parties’ intentions and aspirations, neither of which are sufficient to convey” on the retirees the benefits they claim, Page said.

Legghio & Israel PC and William A. Wertheimer Assoc. represent the retirees. Barris Sott Denn & Driker PLLC and Kirkland & Ellis LLP represent Honeywell.

The case is UAW v. Honeywell Int’l Inc., 2018 BL 264108, E.D. Mich., No. 2:11-cv-014036, order granting defendant’s motion for summary judgment 7/25/18.