Nov 26, 2019
Pennsylvania Supreme Court Rejects Fluctuating Work Week Method The PA Supreme Court ruled that the “Fluctuating
The former employees had worked for United Refining Company in Warren, Pennsylvania for years, but left the company prior to their retirement age. At the time they left the company, each was promised unreduced pension benefits at their early retirement age. One of the former employees received an unreduced benefit for more than a decade before being informed that his benefit would stop and he would owe the plan more than $14,000.
The former employees brought a class action lawsuit on behalf of themselves and other former employees whose employment also terminated prior to retirement, a category referred to as “terminated vested participants.” The lawsuit alleged that United Refining violated federal law by reducing or “cutting back” the terminated vested participants’ accrued pension benefits.
Both sides moved for summary judgment, arguing that the undisputed facts entitled them to judgment as a matter of law. Summary judgment is used during civil litigation to promptly dispose of a matter without a trial.
On April 8, 2013, the U.S. District Court for the Western District of Pennsylvania, Erie Division, ruled in favor of the two named plaintiffs. To review the Court’s Order, please click here: United Refining Summary Judgment Opinion
The Court found that, from 1995 to 2002, the administrator of the pension plan consistently interpreted the relevant plan language to provide unreduced early retirement pension benefits to terminated vested participants.
The court rejected United Refining’s argument that the payment of unreduced pension benefits had been a mistake. The Court held that the initial interpretation that terminated vested participants were entitled to unreduced early retirement benefits was rational, while the company’s re-interpretation of the plan was unreasonable and rendered key plan language meaningless.
The named plaintiffs will now seek to extend their victory to the other terminated vested participants by having the lawsuit certified as a class action.