A federal judge in Philadelphia says employers who offer retiree health benefits have to offer comparable benefits to early retirees and to retirees who are eligible for Medicare.[@@]
The judge, U.S. District Judge Anita Brody, says the U.S. Equal Employment Opportunity Commission lacks the authority to interpret the Age Discrimination in Employment Act in a way that would permit employers to offer different benefits for older and younger employees.
The judge also issued a permanent injunction that prohibits federal officials from enforcing the new EEOC interpretation of the ADEA antidiscrimination provisions.
The judge cited an earlier ruling from the 3rd Circuit U.S. Court of Appeals which held that employers may offer different health plans to retirees of different ages only if the plans are of equal value or provide equal benefits. That decision involved retirees who had worked for Erie County, Pa.
The EEOC had hoped to publish a final rule implementing its interpretation of the ADEA antidiscrimination provisions in February, but it was unable to do so because the AARP, Washington, sued to block enforcement. The AARP contended in its suit that giving differing packages to the young and the old amounts to age discrimination.
The American Benefits Council, Washington, a major employer group, submitted a brief supporting the EEOC. The benefits council said the proposed rule “had been thoroughly vented through interagency review” and was “supported by members of Congress from both sides of the aisle.”