Employment — public employment

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Wisconsin Court of Appeals

Civil

Employment — public employment — vested benefits

County employees did not have a vested benefit contract requiring the County to reimburse their Medicare Part B premiums when they retire from County employment, because they were not yet retired when the County eliminated that benefit.

“Federation, et al., contend that these provisions prevent the County from eliminating the Medicare-Part-B-premiums benefit even though it was not yet fully earned. The vested benefit here, however, is the eligibility to have the County reimburse a retiree’s Medicare Part B premiums—under Loth, this eligibility does not become entitlement until all of the prerequisites are met. It is true, of course, that once eligibility matures into entitlement, a benefit may not be retroactively modified or eliminated. See Loth, 2008 WI 129, ¶39, 315 Wis. 2d at 50, 758 N.W.2d at 773 (‘The City is not attempting to modify any contractual obligation to Loth. Loth did not accept the City’s unilateral promise of no-premium-cost health insurance benefits; he had not fully performed the services entitling him to such benefits when the City amended in [sic] policy in 2002 effective in 2004.’); Section 21 of Chapter 201 of the Laws of 1937 as created by Chapter 405, § 2 of the Laws of 1965 (‘no such change shall operate to diminish or impair the annuities, benefits or other rights of any person who is a member of such retirement system prior to the effective date of any such change.’) (Emphasis added.). But before the employee has fulfilled the entitlement prerequisites, the County was free to change or eliminate it. See Loth, 2008 WI 129, ¶47, 315 Wis. 2d at 54, 758 N.W.2d at 775 (City could modify Loth’s benefit package because he ‘had not satisfied all three requirements’ before the effective date of the changes.); Champine v. Milwaukee County, 2005 WI App 75, ¶19, 280 Wis. 2d 603, 617–618, 696 N.W.2d 245, 252 (‘Our holding today does not forever bind the County to pay out all sick allowance that an employee will accrue in the future, and in that respect it is responsive to the concerns of the County that, in the absence of a collective bargaining agreement or employment contract, it should not be bound to continue providing a benefit it now regrets offering. The ability to obtain payout for sick allowance accrued after March 14, 2002, may be modified prospectively by the County.’).”

Reversed and Remanded.

Recommended for publication in the official reports.

2012AP2490 Wisconsin Federation of Nurses & Health Professionals v. Milwaukee County

Dist. I, Milwaukee County, Foley, J., Fine, J.

Attorneys: For Appellant: Levy, Alan M., Milwaukee; For Respondent: Sweetland, Jeffrey P., Milwaukee