Honeywell plans to cut healthcare for 4,700 retirees

April 29--SOUTH BEND -- More than 4,700 Bendix, Allied Signal and Honeywell Aerospace retirees nationwide may lose their healthcare and prescription drug coverage after the company sent them a letter giving notice of its intent to terminate their coverage on July 31.

It is a continued effort by the company to cut the benefits, an effort that was stymied by a temporary injunction filed by the United Auto Workers in May 2017. Now, another court decision was cited by the company as providing the legal basis for slashing the benefits.

Woody Kepler is one of the retirees who would be affected. Starting at Bendix in 1967 when he was 20, Kepler spent his entire career at Bendix and its successor company Allied Signal, which later purchased Honeywell and retained the Honeywell name.

Since retiring in 1997, he's fought off cancer twice, including lung cancer most recently in 2016. When doctors did biopsies on Kepler's left lung, they found that exposure to asbestos and chemicals at work may have contributed to the cancer. Since finding out his coverage will be terminated, Kepler has taken steps to join a class action lawsuit against Honeywell.

"It's not a matter of if (the cancer) comes back, but when," Kepler said. "If it does, it's kind of a death sentence."

Kepler and five other retirees or retiree spouses interviewed by the Tribune were all told throughout their careers that they would have healthcare and prescription coverage from their employer for the rest of their lives. Now in retirement, the former employees say they won't be able to afford all of their prescriptions or medical procedures, without the insurance.

"It just doesn't seem right to me," Kepler said. "When you're working, and you're young, you don't really need insurance unless you have some kind of catastrophe. It's when you get older, when your body starts falling apart, that's when you need it. Now all of a sudden we reach that point, and they're taking it away from us."

Honeywell spokesman Scott Sayres said that the move to ax healthcare benefits was a "difficult decision, but necessary to keep Honeywell competitive in a challenging economic environment and enable us to continue to provide tens of thousands of good jobs throughout the U.S."

Sayres declined to share how much money the company expects to save from terminating the benefits.

Current UAW Local 9 president John Suher, Sr., said the retiree healthcare cuts come shortly before Honeywell begins outsourcing jobs from its plant in Mishawaka to a pair of other production facilities, including one in Turkey.

"Between the retirees and losing the jobs here, it's like a double whammy on me," Suher said. "Got a lot on my plate. I haven't slept well, I can tell you that much."

Sayres didn't confirm the location of the facilities, but said Honeywell is "considering two strategic moves" adding that "there is no immediate job impact at this time."

According to the letter from Honeywell, the move to eliminate coverage was made possible by a March 29 ruling in a seven-year-long case in Eastern Michigan U.S. District Court. The ruling by Judge Denise Page Hood found that only current collective bargaining agreements determine the duration of retiree healthcare coverage, but also required that Honeywell repay retirees for premium payments since 2014.

But the five-year collective bargaining agreement signed by UAW workers after a 10-month lockout ended in 2017 doesn't include a clause regarding retiree healthcare or prescription benefits. Previous agreements did.

"That was something the union accepted and it was ratified by the members," Sayres said.

Former UAW Local 9 president Todd Treder, who was present during the 2017 contract negotiations, said the International UAW representatives and Honeywell both said the parties could not discuss retiree benefits.

"We were instructed that we couldn't talk about retiree benefits," Treder said. "I feel for the retirees. A lot of them came to the line when they were locked out. The way it looks, it looks like we just bargained away all their retirement benefits. We didn't do that. Not once did we talk about it. It wasn't my choice, we were just told we're not talking about retiree benefits and so we never did."

UAW International spokesman Brian Rothenburg said the union is unable to bargain retiree benefits, but added that the union's legal department is reviewing the legal language from the court opinion.

On Monday, Local 9 representatives, UAW International representatives, Honeywell and Judge Hood will meet in Detroit to discuss possible reimbursement of the premiums retirees paid to Honeywell.

At 1 p.m. on May 9 Honeywell retirees will meet at UAW Local 5 Hall, 1426 S. Main St., instead of their typical Local 9 meeting place, to discuss the letters, healthcare options and the unions' efforts moving forward.

Suher said he hopes the union is able to stop the termination of the benefits, but added that he thinks Honeywell won't stop there.

"I've never seen a company like this that would rather cut your throat in a heartbeat to save a nickel," Suher said. "Ever since the lockout, it's the worst place I've ever worked."

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