00-3314 Heinz v. Central Laborers' Pension Fund

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“Before the amendment, plaintiffs had the right under the plan to work as construction supervisors and continue to receive their monthly benefit payments. When disqualifying employment was redefined to include work “in any capacity in the construction industry (either as a union or non-union construction worker),” and when the Fund applied that definition to supervisory work, the plaintiffs lost their right to work as construction supervisors while collecting benefits.

“We conclude that plaintiffs’ loss of the option of working as construction supervisors was a reduction of their early retirement benefits within the meaning of sec. 1054(g)(2). A participant’s benefits cannot be understood without reference to the conditions imposed on receiving those benefits, and an amendment placing materially greater restrictions on the receipt of the benefit “reduces” the benefit just as surely as a decrease in the size of the monthly benefit payment. We have not before interpreted the prohibition in the anti-cutback rule as limited to amendments that reduce the amount of the periodic payment, and we find nothing in the language of the rule that suggests such an interpretation.

“Although with a suspension the interruption in benefit payments is temporary, the retiree never recovers the payments lost during the employment period. The amendment thus ‘eliminates’ monthly benefit payments for participants who take certain jobs after retirement and ‘reduces’ the participant’s total early retirement benefits by an amount determined by how long the disqualifying work continues. Plaintiffs lost a valuable right they had earned before the amendment-the right to continue to work in the industry while receiving monthly benefit payments-and that loss was permanent. In our judgment, this was a reduction of early retirement benefits within the plain meaning of sec. 1054(g)(2).”

Reversed and remanded.

Appeal from the United States District Court for the Central District of Illinois, McDade, J., Williams, J.