Prater v. The Ohio Education Association Settlement
The purpose of this website area is to inform you of a proposed Class Action settlement between the Ohio Education Association (“OEA”) and the Professional Staff Union (“PSU”), PSU Retirees and their Dependents, and Retirees of the Ohio Associate Staff Union (“OASU”) and their dependents (collectively “the Class”). In this lawsuit, the Plaintiffs, a certified class of retirees of PSU and OASU and their dependents, challenged OEA’s termination of post-65 healthcare benefits for retirees of PSU and OASU.
The settlement, which was granted preliminary approval by the Court on February 8, 2010, will provide for payments or provision of benefits from OEA in 3 phases. First, OEA will pay to the Class $3,750,000 in full satisfaction of all claims related to the litigation for the period September 1, 2004 through December 1, 2009. Second, upon final approval of this settlement by the Court, OEA will pay into a Voluntary Employee Benefit Association (“VEBA”) established by the class an amount described below from which the VEBA will provide post-65 healthcare benefits to the Class. OEA will also reimburse the Class Representatives up to $7,500 in costs incurred in hiring an actuary to evaluate the value of settlement offers during the settlement negotiations. And, third, OEA will further continue to provide healthcare benefits at the current level to Class Members until the Class Member reaches age 65. This settlement, if granted final approval by the Court, will satisfy and release OEA from any obligation to provide any member of the Class with healthcare benefits after the age of 65. The sole exception will be that OEA will continue to reimburse retirees of PSU for the cost of Medicare Part B premiums, and will further release OEA from any claim or liability for healthcare benefits for the period September 1, 2004 through December 1, 2009.
31 days after the Court grants final approval of the settlement, or on the 31st day after the exhaustion of any appeal if any Class Member objects to the settlement and appeals approval of the settlement, OEA will fund the first year’s payment to the VEBA. The amount to be funded for the first year will be calculated by multiplying $375 (the “Contribution Amount”) times the Benefit Months from December, 2009 through December 31, 2010. A “Benefit Month” is any month within the period in which a Class Member is age 65 or older.
On or before December 31, 2010, 2011, 2012, 2013, and 2014, OEA will fund the ensuing year’s VEBA obligation with a lump-sum payment calculated by multiplying $375 times the percentage increase in the VEBA’s health plan premium cost per member for the coming year, plus $375, times the Benefit Months for the coming year. OEA’s VEBA contribution will be reduced by the number of Benefit Months for the preceding year for which the VEBA did not provide health benefits to a Class Member[s], based on that Class Member’s death or that Class Member’s employment with the PSU beyond age 65. OEA’s obligation and contribution to the VEBA will not be decreased by any Class Member’s election not to receive the benefits provided by the VEBA. On the third through fifth anniversary dates of the first payment, OEA’s VEBA obligation for the coming year will be calculated by multiplying the prior year’s Contribution Amount by the percentage increase in the VEBA’s health plan premium cost per member for the coming year, plus the prior year’s Contribution Amount, multiplied by the number of Benefit Months for the coming year. Each annual funding amount will be reduced by the number of Benefit Months for the preceding year for which the VEBA did not provide health benefits to a Class Member[s] because of death of the Class Member or that Class Member’s employment with OEA beyond age 65.
At the end 2014, OEA will pay for an actuarial analysis of the amount necessary to fund the VEBA for the remainder of the lives of the remaining Class Members. The amount will be determined by a neutral actuary by using the then-current Contribution Amount, the appropriate “medical trend rate,” and the appropriate “discount rate.” OEA will then fund the VEBA at the amount determined by the actuary, paid in five equal installments, adjusted to reflect the time-delay in receipt of the funds by the VEBA Trust.
The Class includes everyone who:
Is presently a retiree of PSU, or
A retiree of OASU who retired on or before August 31, 2006; or
Is a dependent of a retiree of PSU or OASU (a “dependent” is the spouse of an OASU or PSU retiree on the date the Court grants Final Approval of the Settlement, a minor child of an OASU or PSU retiree, or an adult child who is disabled (“disabled” means unmarried, incapable of self-sustaining employment, and dependent upon the retiree for support due to a mental and/or physical disability);or
Is currently an employee of OEA and is a member of PSU whom was hired by OEA and was a member of PSU on or before August 31, 2000 and dependents of those PSU members.
The Court held a Settlement Approval Hearing in this case at 10:00 a.m. on April 29, 2010 at the Joseph P. Kinneary Courthouse, U.S. District Court for the Southern District of Ohio, 85 Marconi Blvd., Columbus, Ohio 43215, and granted final approval of the settlement on May 10, 2010. The Court also decided how much to award Class Counsel as fees and expenses for representing the Class.
|