Cent. Laborers' Pension Fund v. Heinz

Cent. Laborers' Pension Fund v. Heinz

Opinion

 [*741]  [**2234]   Justice Souter delivered the opinion of the Court.

] With few exceptions, the "anti-cutback" rule of the Employee Retirement Income Security Act of 1974 (ERISA) prohibits any amendment of a pension plan that would reduce a participant's "accrued benefit." 88 Stat 858, 29 U.S.C. § 1054(g) [29 USCS § 1054(g)]. The question is whether the rule prohibits an amendment expanding the categories of postretirement employment that triggers suspension of payment of early retirement benefits already accrued. We hold such an amendment prohibited.

Respondents Thomas Heinz and Richard Schmitt (collectively, Heinz) are retired participants in a multiemployer pension plan (hereinafter Plan) administered [****6]  by petitioner Central Laborers' Pension Fund. Like most other participants in the Plan, Heinz worked in the construction industry in central Illinois before retiring, and by 1996, he had accrued enough pension credits to qualify for early retirement payments under a defined benefit "service only" pension. This scheme pays him the same monthly retirement benefit  [*742]  he would have received if he had retired at the usual age, and is thus a form of subsidized benefit, since monthly payments are not discounted even though they start earlier and are likely to continue longer than the average period.

Heinz's entitlement is subject to a condition on which this case focuses: the Plan prohibits beneficiaries of service only pensions from certain "disqualifying employment " after they retire. The Plan provides that if beneficiaries accept such employment their monthly payments will be suspended until they stop the forbidden work. ¹ When Heinz retired in 1996, the Plan defined "disqualifying employment " as any job as "a union or non-union construction worker." This condition did not cover employment in a supervisory capacity, however, and when Heinz took a job in central Illinois as a construction [****7]  supervisor after retiring, the Plan continued to pay out his monthly benefit.

In 1998, the Plan's definition of disqualifying employment was expanded by amendment to include any job "in any capacity in the construction [****8]   [***54]  industry (either as a union or non-union construction worker)." The Plan took the amended definition to cover supervisory work and warned Heinz that if he continued on as a supervisor, his monthly pension payments would be suspended. Heinz kept working, and the Plan stopped paying.

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