Legislature's Labor Committee to Hold Public
Informational Hearing on Pension Benefits
(Hartford, Connecticut) - The Aetna Retirees Association, Inc. (ARA) will participate in a Public Informational Hearing being held by the legislature's Labor and Public Employees Committee. The hearing will focus on the actions by Aetna and other corporations in their efforts to unfairly reduce retiree benefits. This hearing has been scheduled for Tuesday, February 8th at 1:00 PM in Room 2C of the Legislative Office Building in Hartford.
According John Dwyer, chairman of the ARA, the hearing provides legislators a unique opportunity to learn more about the pattern of abuse perpetrated by Aetna and, potentially, other Connecticut-based corporations.
"We are extremely grateful to Representative Ryan and Senator Prague for convening this hearing and providing us with the opportunity to discuss Aetna's unfair and unethical practice of rescinding promised benefits to thousands of retirees," Dwyer said. "While ARA continues to try and convince Aetna to reverse its actions, the organization feels compelled to pursue other avenues to assure that retiree benefits are protected. Requesting and supporting action by legislators is another important opportunity for getting Aetna's corporate executives to do the right thing and properly protect the thousands of retirees who relied on their promises."
A year ago, more than 11,600 Aetna retirees received a letter from Aetna informing them that they were eliminating the existing subsidy for dental benefits effective January 1, 2005. This action came despite numerous commitments from the company that employees who retired could count on receiving the benefits they were promised. Thousands of Aetna employees actually accepted early retirement offers based on the company's promise to maintain benefits.
These reductions in benefits come at a time when Aetna's Chairman has received salary, benefits and stock options worth tens of millions of dollars, some reports have even suggested his total compensation package is in excess of $100M. Aetna is doing so well that it is buying back $750 million in stock as a way to increase the share price. In addition, Aetna recently received a $740 million tax refund from the Federal Government.
Meanwhile, the dental benefit costs Aetna about $3 million dollars a year, but Aetna accountants took the $32 million reserve that was set aside to pay for those dental benefits and redeployed the entire amount into quarterly earnings so that the expectations of Wall Street could be exceeded and thus improve the stock price and the prospects for future bonuses.
"Sadly, this routine of "crying poor" while earning millions has become all too common," Dwyer said. "What's worse, this was not perpetrated by Enron or WorldCom but by our hometown company. It was Aetna that is rescinding its commitment and leaving thousands of Connecticut citizens without the benefits they were promised. We believe our elected officials must hold corporations accountable and work to protect the benefits that have been promised to retirees."
The Aetna Retirees Association, Inc. is a nonprofit association incorporated in Connecticut pursuant to Connecticut statutes and focused exclusively on the protection of retirement health and pension benefits for Aetna retirees and their beneficiaries. The association maintains a website at www.aetnaretirees.com and its mailing address is PO Box 280165, East Hartford, CT 06128.
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A Letter to the Editor of the Hartford Courant
November 11, 2004
The Courant’s Nov. 5 editorial "Deserved Fallout At Marsh Inc." serves to remind all of us that some senior corporate officials and their directors are driven by Wall Street’s insatiable appetite for earnings; earnings at any cost and without regard for any constituency.
The evidence is not all in, but it seems likely that Marsh abused their clients and the companies they sought to represent, in the interest of achieving Wall Street expectations.
But we don’t have to look to New York to find similar corporate misbehavior. Hartford-based Aetna took a $32 million reserve, which had been set aside to pay retiree dental benefits, and redeployed it into quarterly earnings so that Wall Street’s expectations could also be met.
There may be some legal distinctions, but in both cases, trust, honor and integrity were sacrificed at the altar of quarterly earnings. Great reputations are forever tainted and the current dictum "I did it because I could" gains credence. Or is it, "I thought I could"?
John J. Dwyer
Simsbury
The writer is chairman of the Aetna Retirees Association
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Aetna Retirees Join National Retiree Network
(EAST HARTFORD, Connecticut) - The newly formed Aetna Retirees Association, Inc. (ARA) has joined the National Retirees Legislative Network to promote legislation that will protect retiree benefits and pension rights.
The National Retirees Legislative Network, Inc. (NRLN) was started by several large retiree organizations from corporations with household names that include IBM, AT&T, Raytheon and Prudential. NRLN represents more than 2,000,000 individual retirees and maintains a website at www.nrln.org. Their current priorities include HR 1322 - The emergency Retiree Health Benefits Protection Act of 2002 - as well as other Retiree Health and Pension COLA bills.
"With more than 50% growth in the last few weeks, the Aetna Retirees Association has added about 700 retirees to NRLN's numbers. We expect our growth to continue as more people hear about the issues ARA is working on," reported Robert Gilligan, ARA's President. "We see legislation as one of the avenues we must pursue in our efforts to protect the benefits promised to Aetna retirees. There is important work going on at both the national and state levels. NRLN's network and the resources they bring will further support ARA on these issues. "
While ARA continues to pursue a cooperative relationship with Aetna, the organization feels compelled to pursue other avenues to assure that retiree benefits are protected. Supporting action by legislators will focus on corporate executives and the significance of these issues to millions of American retirees. With millions of voters involved, legislators will not take these issues lightly.
"NRLN has provided tremendous assistance to ARA during our formative process." said John Dwyer; Chairman of the Aetna Retirees Association, Inc. "With our recent growth and every expectation of continued growth, we're confident in our ability to contribute to the national effort. Those efforts, in turn, will help us with our Aetna-specific activities."
"Our board has directed that an aggressive assessment of all public relations, legislative and legal options be undertaken before the end of the year. Our membership in NRLN advances that process," Mr. Dwyer concluded.
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Aetna Retirees Form New Association to Fight Loss of Benefits
(EAST HARTFORD, Connecticut) - Aetna's announced intention of withdrawing an existing dental subsidy for currently retired employees in January of 2005 has led a group retirees to formally organize an association to oppose Aetna's decision and preserve and protect existing benefits.
"The Aetna Retirees Association, Inc. (ARA)" announced the completion of its formation process under the laws governing the incorporation of entities in the State of Connecticut. Under its newly approved bylaws, four officers and ten directors were elected to two year terms. The new Association is a nonprofit entity with a specific focus on the protection and preservation of health, dental and pension benefits provided to retirees of Aetna Inc.
Robert Gilligan, president of the new retiree association and a thirty-five year Aetna employee, stated, "While we don't currently have access to specific company data, we believe that there are many retirees whose annual pensions are less than $6,000 and for them, the intended dental subsidy elimination would amount to as much as 10% of their pension income. Executives with multi-million dollar compensation packages can often lose sight of the impact their decisions have on retirees with small pensioners and significant health issues; but nonetheless, who worked with dedication to make Aetna successful. We intend to serve as a constant reminder of those commitments made by prior Aetna management."
The ARA hopes to work with Aetna and seeks to create a cooperative relationship with the company in matters affecting retirees. As one of Aetna's many stakeholders, the association's members are not only retirees but also customers and shareholders.
"We will reach out to all of Aetna's other stakeholders to gain their understanding and support for all the commitments made over the years to employee/ retirees," said John J. Dwyer, newly elected chairman of ARA. "With four hundred and fifty members at the outset, from almost every division, department and job level, across the country we're truly gratified by this early response. Many of the earliest members have volunteered their time and talents so we're confident that we'll have an "all volunteer staff" for the foreseeable future," Dwyer reported.
In the coming weeks ARA will be joining with the National Retirees Legislative Network in Washington, D.C. (www.nrln.org) to advance its legislative agenda.
"Our board has directed that an aggressive assessment of all public relations, legislative and legal options be undertaken before the end of the year", Mr. Dwyer concluded.
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