Goodyear To Increase Health Care Costs For Nonunion Employees, Retirees

Main Category: Health Insurance / Medical Insurance
Also Included In: Seniors / Aging
Article Date: 05 Mar 2007 - 17:00 PDT

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Goodyear Tire & Rubber on Wednesday announced that it will increase health care costs for salaried employees and retirees over the next two years, the Akron Beacon Journal reports. The changes, which will affect 14,000 nonunion employees and 17,000 retirees, are expected to save the company as much as $90 million in 2007, $100 million in 2008 and more in future years. Goodyear officials said they have been examining changes to salaried workers' pensions and health care benefits as part of a plan to save more than $1 billion by the end of 2008. Under the health care coverage changes, set to begin Jan. 1, 2008, Goodyear will end the company's Medicare supplement plan for new employees; discontinue life-insurance policies for salaried retirees; and minimize premiums for retiree health benefit plans. Goodyear said health care costs will increase for retirees and current employees. The company is working to establish an independent health care trust to cover costs for its union workers and retirees. Goodyear plans to make a one-time payment of $1 billion to the trust, but the company still is awaiting court approval of the plan. Goodyear also announced that it will freeze pensions for salaried employees in 2008 and offer an enhanced 401(k) plan. Kathleen Geier, Goodyear's senior vice president of human resources, said, "These changes allow us to continue to provide the kind of compensation packages that are competitive and will attract and retain talented associates." She added, "The changes that we've made were only made after careful consideration of alternatives, recognizing that there will be varying levels of personal impact depending on the circumstances of each associate and retiree" (Mackinnon, Akron Beacon Journal, 3/1).

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