Compliance April 3, 2002

3M Didn't Promise Lifelong Benefits

March 4, 2002 (PLANSPONSOR.com) - Even though Minnesota Mining and Manufacturing's (3M) "Your Benefits" booklet promised retirees "lifetime" medical benefits, former workers still weren't legally entitled to them because the booklet wasn't a Summary Plan Description (SPD), a federal appeals court ruled.
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The US Court of Appeals for the Eighth Circuit rejected arguments by Edward and Dorothy Hughes that 3M should be held to statements made in a 1991 version of 3M’s “Your Benefits” booklet, which referred to the “lifetime” medical benefits. That version of the booklet – published once every three years – should be considered the legal SPD, the Hughes argued.

Generally courts have considered SPDs as the final word about health and retirement benefits in which workers and former workers have a vested interest – more so than other benefit literature that might be distributed.

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Medicare Supplement

Appeals judges said the “Your Benefits” booklet wasn’t an SPD. The controlling SPD was another retiree booklet detailing a Medicare Supplement plan. Even the Medicare Supplement booklet had no language detailing vesting requirements and warned 3M might change the plan’s provisions, the court said.

The “Your Benefits” booklet was distributed to active employees every three years after 3M and the Oil, Chemical and Atomic Workers Union Local 6-75 reached a collective bargaining agreement, according to the court.

The Hugheses also alleged in their lawsuit that 3M’s moves to cut retiree health coverage because was an ERISA violation, a claim the courts rejected.
 
The case was Hughes v. 3M Retiree Medical Plan, 8th Cir.

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