The opinion of the court was delivered by: Curtin, District Judge.
This action was brought in March, 1988, by thirteen former
employees of Dresser-Rand Company to collect unpaid pension
benefits allegedly due. Dresser-Rand and its predecessor
companies owned and operated the Worthington Compressor Plant
in Buffalo, New York. Each plaintiff began his or her
employment at the plant as a union member, either with the
United Steel Workers of America ("USWA") or the Office and
Professional Employees International Union ("OPEIU"). Each
plaintiff thereafter transferred to a non-union management
position at the plant and asserts that he or she was led to
believe that if management positions were ever abolished, the
plaintiff could return to his or her union position without
loss of benefits.
In late 1986 and early 1987, defendants notified plaintiffs
that they were terminating plaintiffs' management positions
and closing the plant. The first three plaintiffs to be so
notified were foundry employees Allen Noble, Anthony
Harasimowicz, and Angelo Romano. They claim they were told by
William Netols, Director of Human Services at Worthington,
that they were entitled, because of their seniority, to return
to the union and collect a union pension at their option.
See Item 60 (Noble affidavit). Mr. Netols categorically denies
this. Item 67, ¶ 2 (Netols affidavit). Plaintiffs claim that
after they were so notified, the company changed its position
and refused to allow them to return to the union.
The remaining ten plaintiffs learned in early 1987 they
would be laid off. Although union personnel continued to work
at Worthington until mid-1987, Dresser-Rand refused to permit
any plaintiff to return to his or her union position. Instead,
most of the plaintiffs left on March 31, 1987, receiving a
retirement package less favorable than they would have
received had they been granted a union pension. Plaintiffs
seek to recover retirement benefits equal to those paid to
union members. Item 14 (Amended Complaint).
Plaintiffs have offered five theories to prove their
entitlement to union pensions. First, plaintiffs argue that
defendants' "policy and practice" of returning a management
employee to his or her union position upon abolishment of that
person's management position is an "employee benefit plan"
under the Employee Retirement Income Security Act ("ERISA").
29 U.S.C. § 1002(3). Second, plaintiffs assert they are
entitled to be returned to their positions under the state law
doctrine of promissory estoppel. Third, plaintiffs claim they
were "participants" in the union pension plan and are therefore
entitled to benefits thereunder. Fourth, plaintiffs argue that
defendants violated § 204(g) of ERISA, 29 U.S.C. § 1054(g), by
decreasing or eliminating plaintiffs' accrued pension benefits.
Finally, plaintiffs claim that defendants' attempt to amend the
union plans in February, 1985, to cease crediting plaintiffs'
years of service in the union pension
fund is null and void, as plaintiffs were not notified of any
Defendants argue that plaintiffs were not entitled to return
to their union positions, that the company never promised such
a return, and that plaintiffs ceased to participate in the
union pension plan when they accepted promotions to
management. Defendants have moved for summary judgment on
these, and other, grounds. Plaintiffs oppose the motion.
As noted, the Worthington Compressor Plant was closed by
defendants in 1987. Dresser Industries had purchased the plant
from McGraw-Edison Company in early 1985. Dresser-Rand took
over operation of the plant from January 1, 1987, until the
plant closed later that year. Other corporate entities owned
the plant between the time McGraw-Edison owned it, and the
Worthington Corporation ("Worthington") built the plant.
I. STANDING: WERE PLAINTIFFS "PARTICIPANTS" IN EITHER UNION
As an initial matter, the court must decide whether
plaintiffs were "participants" in either the USWA or OPEIU
pension plans under ERISA. If not, plaintiffs would lack
standing to sue for benefits under these plans. 29 U.S.C. § 1132(a).
See also Tuvia Convalescent Center, Inc. v. National
Union of Hosp. & Health Care Employees, 717 F.2d 726, 729 (2d
ERISA defines "participant" as "any employee or former
employee of an employer . . . who is or may become eligible to
receive a benefit of any type from an employee benefit plan
which covers employees of such employer. . . ."
29 U.S.C. § 1002(7) (emphasis added). The Supreme Court, in Firestone Tire
& Rubber Co. v. Bruch, 489 U.S. 101, 109 S.Ct. 948, 103 L.Ed.2d
80 (1989), has recently explained the scope of this definition.
In our view, the term "participant" is
naturally read to mean either "employees in, or
reasonably expected to be in, currently covered
employment," Saladino v. I.L.G.W.U. National
Retirement Fund, 754 F.2d 473, 476 (CA2 1985), or
former employees who "have . . . a reasonable
expectation of returning to covered employment" or
who have a "colorable claim" to vested benefits,
Kuntz v. Reese, 785 F.2d 1410, 1411 (CA9) (per
curiam), cert. denied, 479 U.S. 916 [107 S.Ct. 318,
93 L.Ed.2d 291] (1986).
Bruch, 489 U.S. at 117, 109 S.Ct. at 957-958.
At this point, the court need not decide whether plaintiffs
were "employees in . . . currently covered employment."*fn2
Id. (quoting Saladino, 754 F.2d at 476). For plaintiffs to have
standing as participants, they need only have had a "reasonable
expectation of returning to covered employment." Id. (quoting
Kuntz, 785 F.2d at 1411).