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Compliance August 18, 2010
Visteon Ordered to Restore Retiree Benefits
August 18, 2010 (PLANSPONSOR.com) – A U.S. Bankruptcy Court judge has ordered Visteon Corp. to reinstate health and life insurance benefits to retirees.
Reported by Rebecca Moore
Bloomberg reports that the judge also ruled that the 6,000 plus retirees must also be reimbursed for any health care expenses they incurred since the cuts took place. “There needs to be no period in which these people are not covered retroactively,” the judge said at a hearing, according to the news report.
Attorneys for Visteon and its unions will work out how quickly the benefits should be restored and whether retirees should be represented by an official committee.
The Bankruptcy Court decision follows a July ruling by the 3rd U.S. Circuit Court of Appeals which reversed lower court rulings that Visteon Corp. can terminate retiree benefits during bankruptcy (see Visteon Must Follow the Rules before Terminating Retiree Benefits). The appellate court said Visteon must attempt to reach an agreement with the retirees regarding modification of retiree benefits before it can ask the bankruptcy court to modify or terminate them.