Jury rules for former Kalkaska employee in benefits case

April 25--TRAVERSE CITY -- A former Kalkaska Village clerk will be awarded financial damages after her former employer stopped paying her health insurance.

Virginia Thomas sued the village after village officials decided to end their retiree health care program, a move that went into effect in September 2014. A jury on April 16 ordered the village to pay Thomas about $180,000 in damages, an amount that includes estimates for the next 12 years.

Thomas' attorney, John Di Giacomo, said the issue was a 1996 agreement that said insurance benefits would be paid for through a fund into which employees put part of their wages; the agreement also held that coverage couldn't be lessened or increased.

"The agreement in 1996 was written by non-lawyers, and so it was not well-drafted," Di Giacomo said. "The contract was ambiguous."

Thomas and other employees put salary equaling $1 an hour into an insurance fund. The fund ran out of money in 2012 because of a combination of rising health insurance costs and fewer employees who could pay into the fund.

The village switched to paying for benefits from the general fund.

Di Giacomo said he introduced evidence at a three-day trial in 46th Circuit Court that showed the village always intended to provide former employees with lifetime insurance benefits. The jury deliberated about 40 minutes before making a decision, Di Giacomo said.

Questions to the village were referred to Village President Jeff Sieting, who did not return requests for comment.

Village Trustee Katina Banko said trustees likely will discuss the case and whether they want to appeal at their meeting Monday at 6 p.m. in the village office.

She said the contract doesn't require the village to pay for benefits.

"The contract said the payments for retiree health insurance come from their wage concession," Banko said. "That fund was no longer solvent, so we're paying it out of the village taxpayers' general fund."

Mel Hill, a former village police chief and village manager who lost his health benefits, also sued the village. His case is pending.

Village officials told the Record-Eagle in June 2014 that they made the decision to reduce the village's unfunded liability.

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