A new class action lawsuit was filed Monday on behalf of Hanford Site workers whose pension benefits were reduced when they were transferred from contractors and subcontractors at the Department of Energy facility to six “enterprise companies” in 1996. Attorney Douglas McKinley, of Kennewick, Wash., filed the lawsuit in the U.S. Court of Federal Claims on behalf of personnel assigned to the companies as part of a failed economic development strategy in the Hanford area.
The enterprise companies were formed as part of the Hanford cleanup contract awarded to Fluor Hanford in 1996. The new companies were given some work on the Hanford property, but were supposed to find additional off-site work to grow their operations and diversify the Tri-Cities economy. About 2,200 Hanford workers were assigned to the enterprise companies, with most continuing to do the same Hanford work they had done before Fluor won the cleanup contract and some not even changing desks or offices.
However, they no longer accrued years of service toward their pensions provided for their work at Hanford. McKinley said many, if not most, enterprise company workers lost tens of thousands of dollars in pension payments. In the lawsuit he said damages to workers would be proved at trial, but estimated them at $100 million. The lawsuit asks for the recovery of pension losses; for a judgment against the federal government in an amount to be determined at trial; and for attorney fees and expenses.
McKinley filed a similar class action lawsuit in 2016, but it was only for workers at Lockheed Martin Services Inc., the enterprise company that lasted the longest. Two of the six enterprise companies folded by 2000. Lockheed Martin lasted until 2016, with some workers not accruing service toward their pension calculation for 20 years.
The Department of Energy established a multi-employer pension plan for Hanford in 1987 to reduce the administrative burden and costs of transferring pension funds for thousands of employees from old contractors to new contractors. The new site-wide Hanford plan would guarantee employees would continue to participate in the pension plan and that their years of service would be included in calculations if the contractor they worked for was replaced with another contractor, according to court documents.
When the new enterprise companies were not listed as employers in the Hanford multi-employer pension plan, some workers tried to withdraw their pension benefits. The plan, controlled through the Department of Energy, refused the withdrawals because the plan did not have enough resources to pay out the pensions and remain adequately funded, the lawsuit claims.
In 1997, the plan was amended to allow enterprise workers to count their highest five years of salary toward their pension calculation, but there was no change to the freeze on years of service for the pension calculation. The Energy Department continued to fund the pension plan for the enterprise workers to meet any increased benefits due to higher salaries, the lawsuit said.
In 2017, the U.S. Court of Federal Claims dismissed the initial class action lawsuit covering just Lockheed Martin Services workers. It said DOE had no obligation to continue full pension benefits for workers assigned to enterprise companies. The case has been appealed to the U.S. Court of Appeals for the Federal Circuit.
McKinley has received requests since he filed the initial case in 2016 to also help the employees of other failed enterprise companies. He said he first wanted to see how the lawsuit for Lockheed employees progressed. Now he is confident both in the merits of the case and also that the appeal will be decided in workers’ favor to file a broader class action, he said. He has posted information on how to join the new class action lawsuit at www.mckinleylaw.com.
