The 3rd Circuit Court of Appeals, headquartered in Philadelphia, has given the EEOC approval to implement a final rule allowing employers to give greater benefits to younger retirees than to Medicare-eligible retirees — without violating age-discrimination rules.
The court ruled in June that the agency has the authority to implement a rule that would exempt from the ADEA some health plan changes that affect retired workers when they become eligible for Medicare.
The end result — employers can maintain a two-tier retiree health benefit plan without fear that the plan may mean an ADEA lawsuit. The challenge was brought by AARP. No word yet on whether it will appeal to the U.S. Supreme Court.