Employees sue Provo School District, UEA, others

PROVO — Thirty-four employees of the Provo School District have sued the district, the school board, their local employee unions and the Utah Education Association, claiming a post-retirement benefit was taken from them without their knowledge.

According to the suit, filed Monday in 4th District Court, the 34 employees — which include both teachers and classified hourly employees — claim they were not made aware that the Medicare supplementary insurance for retirees called Medigap would be eliminated from contracts at the end of the 2004-05 school year.

The contract was negotiated and signed by district officials and union leaders before it was sent to the employees for ratification. The suit claims few employees had an opportunity to review the contract prior to the annual ratification vote.

The 34 employees are asking the court to bar the district from limiting the Medigap benefit to people employed at least 20 years. They have requested a jury trial.

They seek attorneys' fees; the present value of Medigap or contributions to a trust for future Medigap expenses; and compensation for lower salaries they claim they received compared to other Utah school district employees, agreed to in exchange for benefits such as Medigap, for which they no longer qualify.

Medigap pays for medical expenses not covered by Medicare from age 65 until the death of employees and their spouses. It was added to employee benefits in 1980, the suit states.

Throughout the years, employees have sacrificed higher pay in exchange for Medigap, the suit states.

Employees paid dues to the Provo Education Association, Provo Classified Employees Association and the UEA. They were led to believe that representatives from the unions had taken steps to legally secure Medigap, the suit states.

Since the early 1990s, the unions never pressured the district to comply with the Governmental Accounting Standards Board requirements that dictate state and local governments prove they are putting away money for retirement benefits that they promise employees, the suit states. The GASB requirements, which are set to become mandatory by law in upcoming years, will end the "pay as you go" tradition.

The GASB requirements weren't addressed until the end of the 2003-04 school year, when contract negotiations began for the following school year. There was not enough money to pay for current Medigap expenses and to put away additional funds for future Medigap expenses. The suit claims union leaders never met with the employees to explain the situation.