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Article 27 .. B. MEDICAL AND DENTAL PLAN # 13 of the PSA CBA
Insurance, Retirement, and Other Benefits
In the event the Company determines that the Standard or Core design options provided for in this Agreement (each an “Option”) would be or become subject to an excise tax or other penalty included in The Patient Protection and Affordable Care Act (PPACA) or any excise tax or penalty which may replace the PPACA, under applicable law, (and thus become an “Affected Option”), the Company will meet and confer in good faith in order to reach an agreement with the Union concerning the minimum modification or modifications to the Affected Option necessary to avoid application of the excise tax or other penalty. The Company shall provide to the Union information that the Union reasonably requests, including actuarial reports, necessary for the Union’s design and consideration of such modifications. Unless otherwise agreed, any agreed modification shall become effective at the time the excise tax or penalty would become applicable in respect of the Affected Option (the “Affected Option Date”).
If the Company and the Union are unable to agree on modifications necessary to avoid the
application of the excise tax or other penalty on the Affected Option within ninety (90) days
after the initial meeting, the parties will select Arbitrator Bloch who will determine the
modifications to the design of the Affected Option that will become applicable. The
authority of Arbitrator Bloch is expressly limited to establishing those modifications to the
design of the Affected Option that will ensure that no excise tax or other penalty will apply.
If Arbitrator Bloch determines that no reasonably practical modification to the Affected
Option can guarantee that no excise tax or other penalty will apply, the Company shall have the right to terminate the availability of the Affected Option to the Passenger Service
employees. If, under the preceding sentence, the Company has terminated or would have the right to terminate the availability to the Passenger Service employees of the Standard and/or Core Option, the arbitrator will be empowered to designate an alternative Option design (a “New Option”) that is available from the Company provider and that replicates the
provisions of the Core Option to the greatest possible extent without causing the New Option to become subject to any excise tax or other penalty. In the event that the arbitrator has not issued a determination prior to the excise tax or penalty becoming due or if such penalty or excise tax is otherwise owed for any reason, notwithstanding any contrary provision of law, the Company shall be permitted to implement such modifications to the design of the Affected Option as it considers to be necessary to avoid the excise tax or penalty. The Company shall have a reasonable period of time following the issuance of the arbitrator’s
Article 27 – Insurance, Retirement, and Other Benefits
determination to implement the New Option. Notwithstanding the foregoing, the provisions
of this Paragraph B.13 shall not be effective if, after the effective date of this Agreement, the
Company enters into any new or amended collective bargaining agreement having a term of three (3) years or more with any union group that does not contain a provision substantially similar to this Paragraph.
If any Option is modified or eliminated pursuant to this Paragraph B.13, the parties will meet and confer to determine how the savings, if any, from such modifications will accrue to Passenger Service employees. The avoidance of any excise tax that would have otherwise been applied will not be considered in the calculation of any savings. If the parties cannot agree on whether cost savings exist or how to distribute said savings, the matter may be referred to an arbitrator as specified by the process in this Paragraph. The arbitrator’s
authority shall be limited to the issue of determining whether such savings exist and, if so, how such savings are to be distributed. The arbitrator shall have no other authority, and in no event shall the arbitrator order modifications to or reinstitution of a plan.