Opinion ID: 519533
Heading Depth: 1
Heading Rank: 1

Heading: A Broken Promise.

Text: 3 After his discharge from the Navy in 1946, Degan began his employment with Ford Motor Company (Ford) at its New Orleans parts distribution facility. That employment relationship would eventually last twenty-four years, during the whole of which Degan was a member of the United Auto Workers, Local 855 (the union), which had a collective bargaining agreement with Ford. Degan was covered by various Ford/union pension plans, the plan at issue here having been incorporated into a 1967 agreement. 4 Ford made a business decision to close the New Orleans facility in 1970, when Degan was forty-five years old. Ford offered the employees of that facility, including Degan, several options: relocation out-of-state; receipt of lump-sum separation pay; or receipt of sub-pay--the separation amount spread out in installment payments over a one-year period. In his affidavit, Degan testified that, in answer to his queries, representatives of Ford and the union advised him of a special benefits package available to New Orleans employees: If he took separation pay, Degan would still be eligible for early-retirement partial pension benefits at age fifty-five, and then full benefits at age sixty. 5 Apparently, that package was acceptable to Degan, who applied for and received $5,243.55 in separation pay. However, the application for that pay, which Degan signed, specified that acceptance of the pay would result in a break in seniority. Degan did not realize that a break in seniority made an employee ineligible for early-retirement benefits under the Ford/union retirement plan. 6 After several months of unemployment, Degan hired on with Caterpillar Tractor Company and worked there for fourteen years, until his retirement. During that time, he maintained contact with Adrian J. Sylvera, a co-employee at Ford who also had elected to receive separation pay and early-retirement benefits at the 1970 closing. Sylvera, who was older than Degan, applied for and received his early-retirement benefits upon reaching age fifty-five. 7 On March 7, 1979, at age fifty-four, Degan wrote to Ford stating that he desired his early-retirement benefits to commence on his birthday and requesting the appropriate application forms. Seven months later, he heard the first words of betrayal: A letter from Ford, dated October 2, advised him that his break in seniority made him ineligible for the benefits he requested. As a consolation, he was told he would be eligible for an early deferred vested pension upon reaching his sixtieth birthday. 8 Degan contacted a union official in charge of pension matters who, after a purported investigation, told him nothing could be done. When Degan inquired as to why he was being treated differently from Sylvera, the official told him that Ford had made a mistake in Sylvera's case and was not likely to do so again. Degan contends that he made numerous amicable attempts, to no avail, to convince Ford and the union that he should receive the package of benefits to which he believed he was entitled. 9 In September 1981, Degan retained counsel, who made a written demand upon Ford for the early-retirement benefits, retroactive to Degan's fifty-fifth birthday. In February 1982, Ford refused the demand, offering the same explanation given to Degan two years earlier. 10