A plan violated ERISA's anti-cutback rule by suspending benefits to an early retiree after changing its definition of "disqualifying employment," the U.S. Supreme Court ruled today. The case is Central Laborers' Pension Fund v. Heinz, No. 02-981, June 7, 2004.
In this case, a construction worker who took early retirement, returned to work as a supervisor, which at the time did not disqualify him from continuing to receive his early retirement benefits. Later, the plan expanded the definition of "disqualifying employment" to cover supervisors and consequently suspended retirement benefits to this retiree/supervisor. The Supreme Court held that ERISA §204(g) prohibits a plan amendment from expanding the categories of postretirement employment and triggering the suspension of early retirement benefits already accrued.
The anti-cutback provision "is crucial" to ERISA's central object of "protecting employees' justified expectations of receiving the benefits their employers promise them," Justice Souter wrote for a unanimous Court.
This case probably does not effect me directly but it is a win for many ER folks and that has to be good. NO?