Two union locals merged. Both had defined benefit pension plans. The details of the plans differed, including whether lump-sum distributions of benefits were allowed. Following the merger of the unions and their pension plans, the merged plan allowed for plan participants who were formerly members of the local whose pension plan permitted lump-sum distributions (Local 675) to continue to receive those distributions based on benefits accrued prior to the merger. Shortly after the merger, the welfare plan of Local 102 (which had also been merged with that of the other local) adopted a rule stating that employees who opted for lump-sum payments of their pension benefits would lose their entitlement to retiree health insurance. This new policy was challenged by a group of plan participants from the former Local 675. 

1. What were the legal issues in this case? What did the court decide?

2. Since the anti-cutback provisions of ERISA apply only to pensions and not welfare plans, why did changing the conditions under which retiree health care benefits were available run afoul of the anti-cutback rule?

3. In what sense were the accrued pension benefits of these employees reduced?

4. What should the benefit plan have done instead?