salaried, non-union individuals who were employed in Firestone's Plastics Division on the date of the sale. Following the sale, plaintiffs and most of the other employees continued, without interruption, to perform their same jobs at the same rates of pay as employees of the new owner, Occidental.
Of the five remaining claims, four are being maintained on behalf of classes; one claim is being asserted by individual named plaintiffs. In count one, plaintiffs, representing a class of all salaried employees employed in the five plants on November 30, 1980 except those employees who retired at the time of the sale or who have been paid termination pay with regard to their employment with Firestone's Plastics Division, claim that they are entitled to termination pay on the grounds that they were terminated by Firestone at the time of the sale; the sale, plaintiffs allege, constituted a reduction in force under Firestone's termination pay policies thereby entitling them to the termination pay.
Count three states a claim for redress for the difference under Firestone's Retirement Plan for Salaried Employees ("Retirement Plan") between an early retirement benefit and a deferred vested retirement benefit. Plaintiffs bring this claim on behalf of a class of all salaried, non-union employees at the five plants who did not qualify, before the date of the sale, for normal or early retirement under the Firestone Retirement Plan. In count five, plaintiffs, on behalf of a class of all salaried, non-union employees at the five plants who had non-vested accrued benefits credited to their accounts under Firestone's Stock Purchase and Savings Plan ("Stock Plan"), seek the vesting of their unvested interests in Firestone's contributions to the Stock Plan.
In count six, plaintiffs represent a class of all salaried, non-union employees who were employed in the five plants on the date of the sale who had vacation time accrued on November 30, 1980 but had not yet taken it. Plaintiffs claim that they are entitled to the vesting of credit for purposes of the Retirement and Stock Plans for the accrued vacation time which was unused at the time of the sale. Finally, in count seven, several individual plaintiffs state a claim for breach of ERISA's reporting and disclosure requirements.
The Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1001 et seq., is a comprehensive statute designed to protect employees enrolled in pension and welfare benefit plans. ERISA provides a private right of action to any participant or beneficiary to enforce his or her rights under either a pension or a welfare benefit plan. 29 U.S.C. § 1132(a)(3)(B)(ii). Although pension and welfare benefit plans serve different purposes, ERISA subjects them to common reporting and disclosure requirements, 29 U.S.C. §§ 1021-31, and standards of fiduciary conduct, 29 U.S.C. §§ 1101-14. Welfare benefit plans, however, are not subject to ERISA's vesting provisions or minimum substantive provisions. Termination pay plans are now generally classified as "employee welfare benefit plans" within the meaning of 29 U.S.C. § 1002(1) and are, therefore, governed by ERISA.
Summary judgment may be granted only when it has been established that there is no genuine issue of material fact and that the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c); Small v. Seldows, 617 F.2d 992 (3d Cir. 1980). The court does not decide issues of fact, but merely determines if there is an issue of fact to be tried. Ettinger v. Johnson, 556 F.2d 692 (3d Cir. 1977). The facts must be viewed in the light most favorable to the non-moving party, and any reasonable doubt as to the existence of a genuine issue of fact is to be resolved against the moving party. Continental Ins. Co. v. Bodie, 682 F.2d 436 (3d Cir. 1982).
Firestone was the administrator of the three plans involved in the claims raised by plaintiffs, and as such, is a fiduciary under ERISA. In reviewing a decision by the administrator of a pension or welfare benefit plan, I am limited to determining whether the administrator's actions were arbitrary and capricious. Unless the decision was arbitrary and capricious, the administrator satisfied its fiduciary obligations under 29 U.S.C. § 1104.
See Northeast Dep't. ILGWU Health and Welfare Fund v. Teamsters Local No. 229 Welfare Fund, 764 F.2d 147, 163 (3d Cir. 1985); Wolf v. National Shopmen Pension Fund, 728 F.2d 182, 187 (3d Cir. 1984).
Count One - Termination Pay
In count one, plaintiffs seek the recovery of severance or termination pay benefits to which they claim they were entitled upon the sale of the Plastics Division. Upon divestiture of the five plants, Firestone refused to pay severance benefits, asserting that no event had occurred which gave rise to a right to such benefits.
At the time of the sale, Firestone maintained a non-funded, non-contributory severance pay benefit plan for its employees. The terms of the plan were set forth in two personnel documents. First, the Salaried Employees Handbook, which was in effect in 1980 and which was given to each employee, provided in pertinent part:
If your service is discontinued prior to the time you are eligible for pension benefits, you will be given termination pay if released because of a reduction in work force or if you become physically or mentally unable to perform your job.