My sister worked for CUNA Mutual here in Madison for well over thirty years. During her time there she was a member of OPEIU Local 39. Part of the contract stipulated that employees could bank unused sick time and use it during retirement to pay for health insurance. When my sister retired early part of the reason she was able to was because of the amount of sick leave she had banked. Her health care costs would be covered until she was eligible for Medicare.
For quite some time CUNA management has been trying to take this benefit away from retirees,
CUNA Mutual was sued after it stopped paying any share of employees’ health care in 2008, eliminating the $121 million liability from its balance sheet and, in doing so, eliminating the managers’ sick pay balances accumulated since 1982.
The suit alleged CUNA Mutual breached a promise to reward employees at retirement for coming into work instead of calling in sick.
CUNA in essence has stabbed its retirees in the back. My sister counted on those benefits for her early retirement. Now her retirement savings will not only have to support her but will also have the added and unexpected expense of health insurance premiums.
The court’s majority decided the case under provisions of the Employment Retirement and Income Security Act, which allows employers to unilaterally change the terms of health care plans as long as they include a reservation-of-rights clause in plan documents.
The retirees didn’t have a vested interest in their sick pay benefit, and an employer can prefer its own and its investors’ interests over those of retirees and employees, according to the majority opinion.
Emphasis mine. According to our courts investors interests are more important that the rights of the people who signed a contract with the employer.
In a statement, company spokesman Rick Uhlmann said “CUNA Mutual has an obligation to protect the company’s financial position and its policyholders. As such, we made the very difficult decision to eliminate the company-funded subsidies for retiree health insurance premiums.
Emphasis mine, what Mr. Uhlmann is saying is that profits are more important than people, and I am willing to bet it was not a difficult decision. They took away a $121 million dollar benefit when in 2010,
...the company's bottom line was $87 billion in net income for 2010. The report also showed a rise of about 7 percent in total assets, to $15.4 billion.
In some ways I am too close to this to really say anything coherent about this particular issue. I know how it makes me feel. We live in a nation where a company that made $87 billion can claim poverty and break a $121 million promise to their retirees. What in the hell is wrong with this picture? I was raised to know that when you make a promise, you keep it. CUNA has broken a promise to its employees and retirees. By some twisted logic shareholders are more important than the people who gave all to build the company into what it is today.