Strike threat, pension ills follow Forum to court

The health-care system’s bankruptcy hearing begins this morning.

By Peter H. Milliken

YOUNGSTOWN — On the eve of a major court hearing in its Chapter 11 bankruptcy reorganization, the beleaguered Forum Health was buffeted by a strike threat from one of its registered nurses’ unions and by a finding that its pension plan is underfunded by more than $200 million.

The nurses union, the Ohio Nurses Association, coupled its objection to Forum’s motion to void the nurses’ union contract at Northside Medical Center with the strike threat in a filing it made Monday in U.S. Bankruptcy Court.

“The nurses are prepared to strike rather than permit the debtors to engage in the bad faith of reneging on a tentative agreement with impunity,” the union said.

“The nurses have the right to strike. Their current stoicism should not be misunderstood. ... Debtors who abuse their employees take a reckless risk with the futures of their companies,” the ONA said in the filing by its Milwaukee lawyers.

The ONA complained in the filing that the union and Forum reached a tentative agreement at the bargaining table, with the nurses agreeing to all $4.4 million in concessions demanded by Forum, only to have Forum’s board of trustees later reject the agreement.

Also in Monday’s 35-page filing, the ONA said Forum’s motion to void the nurses’ contract should be denied because Forum has “unremedied violations of the collective bargaining agreement,” namely Forum’s failure to pay into the pension plan the $1,437,000 that was due April 15.

The union also argues that Forum hasn’t even tried to show the court “that it is in danger of imminent collapse; it merely seeks to stampede the court into granting partial, permanent relief from a collective bargaining agreement.”

A Monday filing by the federal Pension Benefit Guaranty Corp. estimates Forum’s pension plan is underfunded by $207.3 million. Forum seeks to terminate its pension plan and turn it over to the PBGC, which insures pensions.

The ONA and PBGC filings came on the eve of a hearing at 9:30 a.m. today before U.S. Bankruptcy Court Judge Kay Woods concerning several issues in the Forum case.

Forum Health, which filed for bankruptcy protection March 16, operates Northside Medical Center in Youngstown, Trumbull Memorial Hospital in Warren and Hillside Rehabilitation Hospital in Howland.

The Service Employees International Union District 1199 filed a two-page objection on Monday to Forum’s proposal to void its contract with service workers at Northside.

In its objection, that union said it had reached an agreement with Forum concerning the transfer of the pension plan. In a statement to the media, an SEIU leader recently said his membership doesn’t object to transferring the plan to the federal insurer.

Forum and the service workers’ union have bargaining sessions set for Wednesday and July 22, and the SEIU said it is hopeful an agreement can be reached.

Today’s court hearing concerns Forum’s request to end its pension plan and turn it over to the PBGC and to void its nurses’ and service works’ union contracts at Northside.

Also to be discussed at this hearing is a request by Forum’s creditors to deny Forum a four-month extension of its exclusive time to file a bankruptcy reorganization plan. Forum Health owes its lenders $139 million.

In a July 6 prepared statement for the media, Forum said its pension plan is underfunded by more than $100 million, but it didn’t give a specific figure. Most of the plan’s 7,132 participants have retired.

Forum said in an earlier court filing that its short-term survival will be threatened if it can’t immediately begin terminating the pension plan and turning it over to the PBGC.

For the federal insurer to take over the pension plan, the bankruptcy judge must determine that Forum can’t reorganize unless it is relieved of the costs of the pension plan, the pension insurer said.

The PBGC also said that it can’t take over the pension plan if doing so would violate any union contracts. “Accordingly, the modification or rejection of the unions’ collective bargaining agreements here is a prerequisite to the distress termination of the pension plan,” the PBGC said.

In a 29-page court filing on July 3, Forum told Judge Woods it needs relief from the union contracts to terminate the pension plan and turn it over to the federal pension insurer.

The union contracts say Forum must provide a pension plan, according to Walter Pishkur, Forum’s president and chief executive officer.

As of last Dec. 31, the pension plan’s assets of $205,419,808 equalled only 63.7 percent of its $322,631,706 in projected benefit obligations, Forum reported to the court.

Forum Health officials could not be reached to comment on the latest PBGC and ONA court filings.