FIRMS CAN'T FIRE WORKERS, MOVE JOBS TO CUT BENEFITS, COURT RULES.

Byline: Associated Press 

Employers cannot fire workers and contract out their jobs to another company in an effort to reduce their health and other benefits, the Supreme Court said Monday.

The unanimous ruling keeps alive a claim by former cargo handlers at a Los Angeles rail yard that their jobs were moved to another company in a conspiracy to reduce their benefits.

In other action, the court:

Agreed to referee a legal dispute that, although narrow, could affect some 8.7 million Americans covered by multi-employer pension plans.

The court will decide in a case from San Francisco what deadlines pension fund officials confront when they sue employers for withdrawing from such plans without paying their legally required share.

Nationwide, there are about 2,000 defined-benefit plans in which more than one employer provides the funding. An employer that withdraws is legally obligated to pay ``withdrawal liability,'' an effort by Congress to ensure a plan's stability and guard against benefit losses.

Agreed to use a Missouri case to clarify the procedure for deciding which creditors in a bankruptcy case get the value of a car recently purchased on credit.

The court said it will hear arguments by a company that financed a Missouri woman's car that it, not the woman's other creditors, is entitled to the value of the car.

Killed a California man's lawsuit against the owner of a tugboat he was helping paint when he was injured in 1989, somewhat narrowing the legal definition of a seaman.

The court ruled by a 6-3 vote that he was a longshoreman, and not a seaman potentially entitled to more generous compensation, when the accident occurred.

Seamen, unlike maritime workers who are classified as longshoremen or harbor workers, can sue their employers for alleged negligence when hurt on the job. For nearly 80 years, however, federal courts - including the Supreme Court - have struggled to determine just who qualifies as a seaman.

The benefits case involves the federal Employee Retirement Income Security Act, which requires pension benefits to be vested in five years, which means a worker cannot be forced to give up those benefits.

The law allows employers to reduce or cancel health insurance and other benefits at any time. But it bars them from firing or discriminating against workers in an effort to interfere with their right to collect benefits.

Five former cargo handlers alleged that a Los Angeles subsidiary of the Atchison, Topeka & Santa Fe Railway conspired to deprive them of pension, health and other benefits.

The lawsuit said that in 1990, Atchison canceled its contract with its subsidiary, Santa Fe Terminal Services, and awarded the contract to another company, In-Terminal Services.

Santa Fe then fired the workers, who then were hired by In-Terminal, which provided lower pension, health and other benefits. The former employees sued all three companies.

Supported by the Clinton administration, the former employees said an employer's right to change benefits does not allow it to fire workers to achieve such a change.

In agreeing with the fired workers, Justice Sandra Day O'Connor wrote for the court that an employer can reduce or cancel benefits but must follow proper procedures in doing so.

The justices returned the case to a lower court to consider other issues raised by the rail company.