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KIETLINSKI v. GE

May 25, 1995

RICHARD KIETLINSKI, on behalf of himself and all other Retired Employees of General Electric Company, Similarly Situated, Plaintiff,
v.
GENERAL ELECTRIC COMPANY, Defendant.


Ralph W. Smith, Jr., United States Magistrate Judge


The opinion of the court was delivered by: RALPH W. SMITH, JR.

U.S. Magistrate Judge

 MEMORANDUM-DECISION AND ORDER

 This matter was referred to the undersigned by the Honorable Con. G. Cholakis by Order dated August 9, 1994 for all further proceedings and the entry of final judgment upon the consent of the parties and in accordance with the provisions of 28 U.S.C. § 636(c) and Fed. R. Civ. P. 73.

 Plaintiff, a former General Electric Company ("GE") employee, brought this action on behalf of himself and all other similarly situated former GE employees (the "class" or the "plaintiff class"), *fn1" seeking (1) entitlement to a "special supplement" under the GE pension plan, (2) continuation of health insurance benefits until age 65 at no cost, and (3) "broader benefits" than those provided to other GE retirees. Although originally brought in New York State court and alleging only state law claims, this action was timely removed by defendant to this court on the ground that plaintiff's claims are preempted and governed by the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. § 1001 et seq.

 A bench trial was held in this matter between March 14 and March 16, 1995. Immediately following the parties' opening statements, the plaintiff class withdrew its claim for continuation of health insurance benefits until age 65 at no cost in light of the Supreme Court's recent decision in Curtiss-Wright Corp. v. Schoonejongen, 131 L. Ed. 2d 94, 115 S. Ct. 1223 (1995). In addition, the plaintiff class has abandoned its claim for "broader benefits" than those provided to other GE retirees. Thus, the only issue remaining to be decided is whether the members of the plaintiff class are entitled to a "special supplement" under the GE pension plan. This Memorandum-Decision and Order constitutes the court's findings of fact and conclusions of law pursuant to Fed. R. Civ. P. 52(a).

 Findings of Fact

 In November of 1986, GE announced the closing of a plant in Schenectady, New York. In connection with said plant closing, affected employees were offered certain options regarding layoff or termination pay.

 Members of the plaintiff class who were "hourly" employees of GE had three options from which to choose. The first, called Special Continued Termination Pay ("SCTP"), was available to employees who, in May of 1987, were between 55 and 60 years of age and had at least 25 years of continuous service with GE. Eligible employees who chose to accept SCTP agreed to terminate their employment with GE. In return, they would receive, inter alia, 50% of their straight-time earnings until age 60, with some restrictions. At age 60, they would officially "retire" and begin receiving pension benefits from the GE pension plan. *fn2"

 As an alternative to SCTP, hourly class members could have chosen to receive benefits under the GE Layoff Benefit Plan (the "LBP"). Finally, they could have foregone either SCTP or the LBP and exercised "bumping rights" under their union contract. *fn3"

 On the other hand, members of the plaintiff class who were "salaried" employees of GE did not have bumping rights, and thus had to choose between SCTP and the LBP. However, the evidence at trial indicated that, at least with regard to the members of the plaintiff class, benefits under SCTP were substantially greater than those under the LBP, and all of the class members in fact chose to accept SCTP instead of the LBP.

 The GE pension plan is renegotiated and amended every three years. *fn4" The plan in effect in May of 1987 was negotiated in 1985 and covered the time period between July 1, 1985 and June 30, 1988. This plan is hereinafter referred to as the "1985 Pension Plan. " In May of 1987, negotiations for the next plan, which would cover the time period between July 1, 1988 and June 30, 1991 (the "1988 Pension Plan"), had not even begun.

 In connection with the SCTP offer, eligible employees were provided with a document that suinmarized the terms of the offer. *fn6" Eligible employees were also provided with an "Employee Information and Election Sheet," a sample of which is annexed hereto as Exhibit "A." This sheet provided, inter alia, an estimate of the pension benefits that the employee could expect to receive if he/she accepted SCTP as compared to the pension benefits that the employee could expect to receive if he/she continued to work for GE until age 60 and then retired. Since the class members were not eligible for the Special Supplement under the pension plan in effect at the time of the SCTP offer ...


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