Retirees sue Xerox over health care coverage
A group of Xerox Corp. retirees is suing the company and its top executives, seeking a court order halting any cuts to their health care coverage.
The suit, filed yesterday in federal court in Rochester, was initiated by the Penfield-based Association of Retired Xerox Employees. The named plaintiffs are 10 Xerox retirees from around the Rochester area, Florida and Connecticut, though the complaint was filed as a class-action suit, representing people who were hired before 1989 and have been receiving free lifetime medical benefits from the company. According to the suit, that class could be more than 30,000 people.
The defendants in the suit are the company itself, the Xerox Retiree Flex Health Care Plan, CEO Ursula Burns, chairwoman Anne Mulcahy, retiree plan administrator Peter Dowd, former plan administrator Lawrence Becker, and Xerox head of human resources Patricia Nazemetz.
The suit argues that Xerox has long indicated to its workers and retirees that they would receive guaranteed lifetime health coverage from the company, and that its announcement in September 2008 that it would begin making cuts in what retiree benefits it provides constitutes a violation of the Employee Retirement Income Security Act of 1974.
As of this year, the company quit providing an allowance to retirees who opted out of coverage under the Xerox Flex Plan. And starting in 2010, Xerox will quit offering to Medicare-eligible retirees and their spouses an allowance used to buy supplemental coverage. Those retirees still will have access to Xerox-provided coverage and its group rate, though they will pay the full cost.
The suit seeks a court order restoring that cut coverage and blocking the company from making any further cuts, as well as reimbursement for past-due benefits.
Xerox spokesman Bill McKee declined to comment on the suit. “However, it is important to note that like so many economy related cost actions that impact current and retired employees, these are very difficult decisions that required extensive analysis,” McKee said. “While no one likes to make benefit reductions, Xerox still remains a very generous company when it comes to retiree health benefits. “
