The Long Island Rail Road says it will go after the pensions of ex-employees who turn down an immunity deal offered by federal prosecutors, and are later caught fraudulently collecting federal disability benefits.
In a letter to employees sent Friday, LIRR president Helena Williams said she "will enforce provisions" in employees' pension plans that allow the LIRR to cancel benefits "when fraudulent activity occurred while an active employee."
Williams added that retirees who take prosecutors' deals "will not put their company pension benefits at risk."
The letter came two days after federal prosecutors notified LIRR retirees that -- to keep all past benefits -- they have until July 6 to come forward and admit that they falsified claims for federal disability benefits.
Those who wait for the Aug. 10 deadline will have to give up half of their past benefits.
As part of the deal, the LIRR agreed not to go after the pensions of anyone who takes the offer. LIRR pensions are valuable benefits that can pay former railroad workers as much as six-figure annual salaries for the rest of their lives.
Prosecutors this week charged 10 former LIRR employees with working large amounts of overtime in their final years to boost their pensions, then seeing doctors claiming debilitating injuries in order to collect bogus disability benefits.
Federal records have shown that LIRR retirees collect disability benefits at an unusually high rate.
The heads of the LIRR's two biggest unions -- the United Transportation Union and the Brotherhood of Locomotive Engineers and Trainmen -- did not respond to requests for comment.
To cancel pension benefits, the LIRR would need evidence that the retiree engaged in fraudulent activity while working for the railroad. That could include coordinating with doctors and consultants before applying for disability benefits.
A pension board would rule on the LIRR's action to take away an employee's benefits. Union workers could appeal and eventually bring their case before an arbitrator.
Edward J. Yule, a Northport attorney who frequently represents LIRR workers, said he doesn't expect many retirees to take the deal because the U.S. Railroad Retirement Board's broad definition of an "occupational disability" makes it tough for prosecutors to make their case.
"To have a mass request to have everyone come in kind of, maybe, indicates that their case isn't so strong," Yule said.
With John Riley