John Deere ERISA Lawsuit Underway

Davenport, IAA lawsuit alleging that Deere & Co. violated Employee Retirement Income Security Act (ERISA) is now under way. The suit, filed on behalf of approximately 5,000 retirees who worked for Deere & Co., claims that changes Deere made to its health plan were in fact a decrease in benefits and a violation of ERISA law. In its defense, Deere said that it repeatedly communicated to employees that it had the right to change its health care plan.

According to an article in the Quad-City Times (September 21, 2009), witnesses for the plaintiffs said they were told that a benefit of working for Deere was the lifetime health benefits provided to retired employees and their spouses.

One witness, William Pendergast who worked as a senior engineer until his retirement in 2001, said that employees were repeatedly told about the "wonderful benefits program," during performance reviews and when no pay raises were coming. Meanwhile, a different witness, who worked as a supervisor and recruiter for Deere, said he was told to talk about the company's benefits package, including health benefits that would continue into retirement.

Talk about Deere's compensation package was, in his opinion, a motivator to convince people to leave their other employment to work for Deere.

Witnesses also spoke about Deere's "broken promises."

The issue stems from a new health benefits plan that was announced by Deere in 2007, which affected approximately 5,000 salaried and non-union wage retirees. The retirees say they were promised their benefits for life. In announcing the new plan, Deere said retirees would be more involved in their health care decisions and allowed the company to make use of changes in federal laws.

However, the retirees say they were the only group put into the new health care plan and taken from group health insurance. They also say that the new plan has had a dramatic impact on the benefits they received.

Plaintiffs in the lawsuit are requesting that Deere restore their original benefits. The trial is expected to last two weeks.

Deere has said that it had the right to change benefits under the plans, that it provided notice of the changes to retirees in October, 2005, and that it told employees and retirees that it had the right to change the benefits plan.