Shaw v. International Association of Machinists
United States District Court for the Central District of California
563 F. Supp. 653 (1983)
- Written by Miller Jozwiak, JD
Facts
Edward Shaw (plaintiff) worked as a representative of the International Association of Machinists and Aerospace Workers (IAM) (defendant). After 10 years of service, Shaw retired and was entitled to a pension. The relevant pension plan included a cost-of-living provision that would increase the pension amount consistent with salary increases to the position from which the employee retired. This feature made the plan a living pension. Upon actuarial advice, however, the IAM voted to phase out the living pension over a course of several years. If the plan failed to do so, the actuaries predicted, the plan would become financially unstable. In response to this change, Shaw sued the IAM for violating the Employee Retirement Income Security Act of 1974 (ERISA), which prohibited decreasing employees’ accrued benefits by amending a plan. The parties cross-moved for summary judgment.
Rule of Law
Issue
Holding and Reasoning (Hauk, J.)
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