Retiree Health Benefit Plans: Modifying and Terminating Legacy Benefits

Evaluating the Alternatives to Contain Costs and Minimize Litigation

In re Unisys: Third Circuit rules for retirees, despite clear reservation of rights in SPD

Recording of a 90-minute premium CLE webinar with Q&A

Conducted on Tuesday, January 12, 2010

Recorded event now available

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Program Materials

This CLE webinar will discuss legal standards that apply to modifying and terminating retiree health benefits and the VEBA alternative to funding retiree medical obligations. The panel will also review the Unisys decision, trends in litigation, and best practices to reserve rights to modify or terminate plans.


Providing retiree medical benefits is a costly endeavor and companies continually seek to shed or contain these legacy costs. Retiree benefit disputes are complicated because an employer’s agreement to provide these benefits is governed by ERISA and in unionized settings, the LMRA.

The nature of the retiree medical promise is the crux of litigation and generates wide splits among circuit courts, making elimination of benefits unpredictable. In addition to the threat of litigation, there are a number of other legal hurdles that employers must clear under ERISA.

Employers have the option to remove post retirement benefit obligations from a company’s balance sheet by setting up VEBA trusts. The creation and structuring of VEBAs must fulfill a number of legal requirements, including SEC filings for companies with registered securities.

Listen as our authoritative panel of attorneys discusses the myriad challenges in shedding or containing retiree legacy costs and best practices to minimize costly litigation.



  1. Overview of standards for modifying or terminating benefits
    1. ERISA
    2. LMRA
    3. Litigation trends
      1. Divergent circuit court standards
      2. Class action threat
      3. Jurisdiction of lawsuit
    4. EEOC regulation regarding coordination with Medicare
    5. Bankruptcy
  2. Preserving the right to alter, modify or terminate benefits
    1. Plan documents
    2. Summary plan descriptions
    3. Enrollment forms
    4. Collective bargaining agreements
    5. Oral communications by plan fiduciaries
  3. Voluntary employee benefit association (VEBA) trusts
    1. Advantages and disadvantages
    2. VEBA creation in court-approved settlements
    3. Creation of VEBAs
    4. Funding mechanisms
    5. ERISA requirements


The panel will review these and other key questions:

  • What are the key legal hurdles for employers seeking to reduce or eliminate retiree medical benefits?
  • What are the steps for an employer to properly document its right to amend or terminate the plan?
  • How do standards differ among the circuit courts regarding retiree medical benefits that arise from collective bargaining agreements?
  • How can employers take advantage of VEBAs to fund retiree medical obligations?
  • What rules and standards apply when the employer seeks to modify or terminate benefits in bankruptcy?


James P. McElligott
James P. McElligott


Mr. McElligott handles employment, executive compensation and benefit related matters for corporations and public...  |  Read More

Stanley Baum
Stanley Baum

Fellheimer & Eichen

He is an expert in all aspects of tax, ERISA, employee benefits, executive compensation and employment law and provides...  |  Read More

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