Ontario Court Rules On Reducing Retiree Benefits

Although the Ontario Superior Court ruled against General Motors of Canada Limited (GMCL) in O'Neill v. General Motors of Canada, the decision provides additional guidance for employers on how to properly reserve the right to change benefits for retired employees.

Background

On July 17, 2013, the Ontario Superior Court of Justice found that GMCL was not permitted to reduce the retirement health care and life insurance benefits for 3,297 salaried employees and surviving spouses who retired after January 1, 1995 but before October 20, 2011. The Court did find that GMCL was permitted to reduce the retiree benefits for 67 executive employees. It has been reported that GMCL intends to appeal the decision.