Sappington

Retired “leadership,” i.e., administrative, employees of the Orange Unified School District (the retirees) filed this class action lawsuit against their former employer (the District) to contest a perceived reduction in a vested retirement benefit. The trial court found no impairment of a vested contract right and entered judgment for the District. We affirm.

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In causes of action for declaratory and injunctive relief, the retirees seek to compel the District to offer them free health insurance through a “preferred provider organization” (PPO) health benefits plan. The retirees contend they have a vested right to their choice of free coverage under either a “health maintenance organization” (HMO) or PPO plan, by virtue of a policy (Policy 4244.2) adopted in 1976 by the Orange Unified School District Board of Education, the governing body of the District.

Policy 4244.2 states as follows: “The District shall underwrite the cost of the District’s Medical and Hospital Insurance Program for all employees who retire from the District provided they have been employed in the District for the equivalent of ten (10) years or longer.”

Based on the parties’ stipulation of…