Reeder Report: Blow to unions

Scott Reeder

Reeder Report: Blow to unions

Sangamon County Circuit Court Associate Judge Stephen Nardulli dealt a blow today to government employee unions who have long contended that retiree health benefits are protected by the Illinois Constitution.

Nardulli granted the state's motion to dismiss a lawsuit brought by former appellate Judge Gordon Maag and other plaintiffs seeking to overturn a new Illinois law allowing the state to charge state retirees for health insurance.

"There is nothing surprising here," said Jonathan Ingram, an attorney and a senior fellow for pension policy at the Illinois Policy Institute. "We have been saying for at least two years that retiree health insurance and pension benefits are different and that Gov. [Pat] Quinn could act on his own to have retirees pay more for their health insurance."

Nardulli noted that retirees are not parties to collective bargaining agreements.

"They can appeal this but I'm confident that the appellate court and the state Supreme Court will agree with the lower court," Ingram said.

"If one were to accept the premise that health insurance benefits are vested rights that accrue upon retirement, one must accept the premise that those benefits cannot be reduced, regardless of changing medical technology or the willingness of insurance providers to make a particular policy of health insurance available," Nardulli said in his decision. "The fact that medical technology and contracts offered by insurance companies change, as opposed to the actuarial certainty of a pension payment, lead this court to the conclusion that health insurance benefits are not the same as a pension protected by the Pension Protection Clause."

Scott Reeder

Veteran Statehouse Reporter and Journalist in Residence

Illinois Policy Institute

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