Class action lawsuit planned over Hanford pensions, benefits

The 586-square mile Hanford site, operated by the Department of Energy in Richland, is listed on a road tour map of the United States as a recommended place to visit in Washington state.
The 586-square mile Hanford site, operated by the Department of Energy in Richland, is listed on a road tour map of the United States as a recommended place to visit in Washington state.

Workers who saw their Hanford pensions cut in a largely failed economic development program are preparing to file a class action lawsuit July 19 against the Department of Energy.

The planned lawsuit seeks to restore Hanford pension and other benefits for as many as 500 former and current employees of Lockheed Martin Services Inc., or LMSI, which provided information technology and other services at Hanford.

More than 100 people packed a a meeting in Richland on Monday evening to hear about the planned lawsuit, which would cover 20 years of benefit cuts.

“It’s not a slam-dunk case,” warned Richland attorney Doug McKinley.

But it may shame the federal government into finally doing the right thing, he said.

“We have nothing to lose,” he added.

Workers have been fighting to have retirement benefits restored since 1996, when about 2,000 Hanford workers were assigned to “enterprise companies” as Fluor won the contract for environmental cleanup at Hanford.

Those companies were no longer considered part of Hanford, and years of service figured into workers’ pensions were capped in 1996.

As most of the enterprise companies folded, some of them by 1998, their workers typically have been reassigned to other contractors with full Hanford pension benefits. But Lockheed Martin Services has remained “outside the fence,” as Hanford workers call it.

Through the years, workers have pursued many avenues to regain lost pension and other retirement benefits, said Peter Turping, a former Lockheed Martin Services worker, who led the meeting.

It’s not a slam-dunk case. ... (But) we have nothing to lose.

Richland attorney Doug McKinley

They have met with state and federal elected and nonelected officials. They have appealed pension payouts. They have filed ethics reports with DOE and Lockheed. They have contacted the DOE Office of Inspector General and made their case in news articles in the Tri-City Herald and letters to the editor.

“Really, the only remedy is to file a legal suit,” Turping said.

Workers have to opt in to the lawsuit. A signup sheet will be available at www.mckinleylaw.com in the coming days for workers who did not sign up at the Richland meeting. A core group of 30 have been covering legal expenses, so there is no cost to sign up for the class action lawsuit, Turping said.

One obstacle the lawsuit faces is the statute of limitations, McKinley said. He will be arguing that the clock did not start running on the case in 1996, but that the case remains current because the committee of Hanford contractors that oversees the Hanford pension continues to make decisions regarding it.

In 1996, enterprise companies were formed with the goal of building long-term, non-Hanford business to become permanent Tri-City companies and reduce the local economy’s reliance on Hanford. Initially, they were given Hanford work and staffed with employees of the previous Hanford contractor, Westinghouse and its subcontractors.

Westinghouse employees, who were not allowed to apply for other jobs at Hanford, were told that Lockheed Martin Services and other enterprise companies were “outside the fence,” and employees there would accumulate no more years of Hanford service to increase their pension benefits when they retired.

“The justification for this injury on LMSI employees was that enterprise companies were commercial entities and not entitled to government benefits,” said a message sent to LMSI workers invited to the Monday meeting.

We think that proves our case.

Peter Turping, former LMSI employee

Not only were years of service frozen on workers’ Hanford pensions, reducing their pension payment, but a retirement medical benefit and a retirement life insurance benefit were eliminated.

Yet, employees assigned to enterprise companies continued to work on the same Hanford projects, often at the same desks and with their same co-workers.

While LMSI employees have long heard that they work for a commercial company, DOE disagreed when it comes to paying for the work.

The Department of Energy said that Mission Support Alliance improperly awarded $63.5 million in taxpayer money as profit to Lockheed Martin Services, according to an Office of Inspector General report issued in April. Lockheed Martin is a principal owner of Mission Support Alliance, which subcontracted some work to Lockheed Martin Services.

The report said that the contract with Lockheed Martin Services was a noncommercial and noncompeted subcontract, making it ineligible for a profit payment beyond what Mission Support Alliance received.

“We think that proves our case,” Turping said.

The issue also came up in state Legislature hearing in 2009 after the state Department of Revenue concluded that Lockheed Martin Services was not doing cleanup work and was not eligible for a lower business and occupation tax rate offered to companies directly involved in Hanford cleanup. Legislation was proposed and passed to restore the tax break.

Workers argued then that it was not fair for companies to claim a Hanford tax break if they did not have to offer their employees the Hanford benefit package because they were considered nonHanford companies when it came to employees.

Annette Cary: 509-582-1533, @HanfordNews