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El Paso Tennessee Pipeline Co. v. Yolton
(U.S. Supreme Court)
Lifetime vesting of retirement health care benefits
The trial court and the Sixth Circuit ruled that retirees and surviving spouses were entitled to lifetime health care coverage pursuant to contracts negotiated between their employer and the UAW. The court recognized that there is no statutory right to lifetime health care benefits, but that life and health insurance benefits carry with them an inference that the parties intended them to continue for life. The NAM filed an amicus brief urging the Court to review the case and describing how different federal court rulings frustrate the efforts of companies to adopt consistent national retiree health benefit programs. The lower court's inference that health benefits vest for life imposes an immense and unexpected burden on employers while providing retirees with an unbargained-for windfall. The Supreme Court declined to review this case.
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