Vesting. The United Auto Workers (UAW) represents workers at Caterpillar, Inc., and negotiates labor contracts on their behalf. A 1988 labor agreement provided lifetime no-cost medical benefi ts for retirees but did not state when the employees’

rights to those benefi ts vested. This agreement expired in 1991.

Caterpillar and the UAW did not reach a new agreement until 1998. Under the new agreement, retiree medical benefi ts were subject to certain limits, and retirees were to be responsible for paying some of the costs. Workers who retired during the period when no agreement was in force fi led a suit in a federal district court to obtain benefi ts under the 1988 agreement. Review the Employee Retirement Income Security Act vesting rules for private pension plans on page 617. What is the most plausible application of those rules by analogy to these facts? Discuss.

[Winnett v. Caterpillar, Inc., 553 F.3d 1000 (6th Cir. 2009)]