Embarq Yanks Retirees' Benefits

Durham, NCThey might be retired, but that doesn't mean they're going to lie down and take it. A group of former employees, whose retirement benefits were covered by a contract with the communications giant Embarq, have launched a national class action to have their medical and life insurance benefits restored.

In the summer of 2007, retired telephone company workers, mostly from the southeastern US, were shocked to get a letter in the mail telling them their pensions were safe, but the medical benefits and the life insurance policies they thought were secure, were gone.

"Some were unionized, but the majority were not," says their attorney Stewart Fisher from the Durham firm of Glenn, Mills, Fisher & Mahoney. "These are benefits that were represented to them throughout their employment, both in writing and in what the human resources people told them when they retired."

The class action was recently certified by a federal judge in Kansas, and there may be as many 14,000 former telephone company retirees who are eligible to join the class.

According to the complaint, Embarq and Sprint Nextel (which was in part recently sold to Embarq) are in violation of federal government pension law (ERISA) and in violation of the federal age discrimination act.

Attorney Fisher says curtailing these benefits has cost the retirees thousands of dollars and is a significant hardship for his clients. Consider 92-year-old James Woodie Britt, a World War II veteran who fought in the Pacific at the Battle of Guadalcanal and worked for the telephone company for 30 years.

"He's 92! He's unable to get any replacement life insurance, so he lost his life insurance," says Fisher. "He has diabetes and a heart condition. This is a significant hardship."

Another of the lead plaintiffs, Doug Hollingsworth, is also a veteran who worked 30 years as a telephone company employee. "He has diabetes and wears an insulin pump," says Fisher, who believes Embarq's decision is harsh.

Embarq has argued that this is a reasonable position because these employees are eligible for Medicaid.

That's not how the retired employees see it—or how attorney Stewart Fisher sees it either. "Well, that's what the lawsuit is all about, we will see."

Stewart Fisher is a graduate of Duke University and earned his J.D. at the University of Northern Carolina School of Law at Chapel Hill. He has written numerous papers about and lectures frequently on labor law in the US.