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HomeMy WebLinkAbout6.2 Motion to approve an Employee Benefits Settlement Agreement between the Village of Mount Prospect and Eric and Kendra Mertes, et al. Pg. 2 Correction - 6/15/2026Item Cover Page Subject Motion to approve an Employee Benefits Settlement Agreement between the Village of Mount Prospect and Eric and Kendra Mertes, et a I . iiiiriiiiir ° iiiiii iiiii 1 5/2,026 Meeting June 16, 2026 - REGULAR MEETING OF THE MOUNT PROSPECT VILLAGE BOARD Fiscal Impact (Y/N) Dollar Amount Budget Source Category CONSENT AGENDA Type Budget Item Information Eric Mertes is a former firefighter with the Village of Mt. Prospect Fire Department. He suffered a series of injuries, both on the job and off, which culminated in a disability determination. He was awarded a disability pension and subsequently applied for benefits under the Public Safety Employee Benefits Act (""PSEBA"), 820 ILCS 320/ et seq. The matter went before Hearing Officer Patrick Bond, who issued a series of decisions, essentially establishing that while Mertes was eligible for PSEBA, the Village did not have an obligation to reimburse Mertes or his wife for any costs related to her plan. Mertes filed an action for administrative review of the Hearing Officer's decisions in the Circuit Court of Cook County. Mertes challenged the ruling that the Village had no obligation to contribute to his spouse's insurance. The Court held that, from the date of Mertes' injury, the Village was required to pay for his insurance premiums and should reimburse him accordingly, and that the Village further be ordered to enroll him on its plan during open enrollment if he chooses, and to pay those premiums. The Court admits that these decisions are in contravention of three other First District Appellate cases, but dismisses those cases as being limited to the Medicare context only and therefore inapplicable. The Court remanded the case to the hearing officer for further determination of the Village's obligations under the decision. On remand, the Hearing Officer determined that the Village was obligated to reimburse the Mertes' for the costs of insurance premiums paid to spouse's health insurance plan through her employer. Mertes have agreed to settle with the Village and end the lawsuit per the terms of the attached agreement. Discussion Alternatives 1. Approve an Employee Benefits Settlement Agreement between the Village of Mount Prospect and Eric and Kendra Mertes, et al. 2. Action at the discretion of the Village Board Staff Recommendation Staff recommends approving an Employee Benefits Settlement Agreement between the Village of Mount Prospect and Eric and Kendra Mertes, et al. Attachments 1. Settlement Agreement FINAL --INCORPORATING OC EDITS(2125589.2) Employee Benefits Settlement Agreement Between the VILLAGE OF MOUNT PROSPECT and ERIC AND KENDRA MERTES, et al. This settlement agreement ("Agreement") is made and entered into this day of 2026, by and between ERIC and KENDRA MERTES, on behalf of themselves and their formerly minor children ("Mertes") and the Village of Mount Prospect ("Village"). The parties enter into this Agreement to secure to each party a full resolution of all issues and to define the parameters of his currently awarded paid health insurance benefits from the Village under the Public Safety Employee Benefits Act, 820 ILCS 320/1, et seq. ("PSEBA") as well as pursuant to Cook County Case No. 2020 CH 4379 (consol w. 2020 CH 4409). 1. Binding Effect. This Agreement shall bind the Village and shall also bind Eric Mertes, his spouse, and his dependents (the "Claimants") who have certain claims under PSEBA. 2. Other Health Insurance Coverage. Kendra Mertes has obtained and maintained employment which provides health insurance as part of its benefit structure for its employees and their spouses. With obtaining health insurance from "any other source", the Village is entitled to reduce the benefits it is mandated to pay. See 820 ILCS 320/10(a)(1); CBA Section 8.1(D). The Parties seek to amicably resolve this matter and memorialize the requirements of each Party in this Agreement. The Parties agree that the Village's responsibilities under PSEBA and the CBA are satisfied as long as each of the following conditions are met: a. Effective immediately, and retroactive to the date of filing of the instant action, Kendra Mertes shall accept the health insurance provided by her employer on behalf of her and spouse Eric Mertes. Kendra Mertes and Eric Mertes shall stay on this health insurance plan so long as they meet the employment and eligibility requirements for said benefit. 2125589_2 b. The Village shall reimburse $1,260.00 quarterly as and for reimbursement of the employee share of premiums assessed by Kendra's employer. Currently the yearly premium contribution is $5,040 for employee and spouse. The Village shall reimburse the Mertes' $1,260.00 by the 15th of the month following each quarter for the preceding quarter of the employee health insurance premium contribution. c. The Village shall pay to Eric and Kendra Mertes a lump sum of $81,277.96, which consists of $70,148.00 in back owed premiums, $1,570.54 for court costs, $7,079.42 in interested owed as a compromised interest payment and $2,480.00 which will make Mertes whole through the end of June 2026, within 15 days of entry of this Order as a reimbursement for premium payments made during the pendency of the controversy between the parties to and through the first quarter of 2026. This payment will fully resolve all outstanding issues between the parties 3. Mertes's Responsibilities. a. Eric Mertes agrees to promptly notify the Village every year prior to the open enrollment for Kendra Mertes' employer sponsored health insurance program. The notification shall include any documentation detailing the amount of the monthly premium for the forthcoming insurance year. b. Eric and Kendra Mertes are solely responsible for the payment of any and all taxes that may be due or owing for the reimbursement of health insurance premiums. 4. Remedies Upon Discontinuance of Current Coverage. In the event that Eric Mertes becomes ineligible to continue with Kendra Mertes' health insurance due to death, disability, divorce, termination, retirement or elimination of health insurance by the employer, the Village agrees that Eric Mertes and his spouse (former dependents having become age -ineligible) are then eligible to join the Village's health insurance plan in effect as an open enrollment event (with the Village responsible for paying the entire premium of the base insurance plan). If after discontinuance of current coverage due to Eric Mertes obtaining employment that provides health insurance, or due to Kendra Mertes obtaining other employment that provides health insurance, the Parties agree that this Agreement shall apply to the new (and any subsequent) employer's health insurance, and the references to Kendra Mertes' employment in this Agreement shall be deemed to be the new or any subsequent employer. 2125589_2 5. Medicare. The Parties agree that as each individual, either Eric Mertes and/or Kendra Mertes, individually reach the age required for mandatory participation in Medicare that the Village's liability for health coverage extinguishes on the individual'y entry into Medicare program. 6. Costs and Attorneys' Fees. Each parry shall bear its own costs and attorneys' fees incurred in the preparing of this Agreement. 7. Entire Agreement. This Agreement is a fully integrated agreement and contains the entire settlement agreement between the Parties hereto. This Agreement supersedes all prior and contemporaneous agreements and understandings, and any and all prior correspondence, conversations, or memoranda between the Parties are replaced hereby. 8. Modifications. This Agreement may not be changed, amended, modified, terminated, waived or discharged except in a document executed by all of the Parties hereto. 9. Counterparts. This Agreement may be executed in counterparts that, taken together, will be effective as if they were a single document. Signatures transmitted by a .pdf file or facsimile shall be treated as originals. 10. Construction. Each Parry has cooperated in the drafting and preparation of this Agreement with the assistance of counsel. As a result, in any construction to be made of this Agreement the same shall not be construed against any Parry. 11. Succession. This Agreement and all of its terms and provisions shall be fully binding upon and inure to the benefit of and be enforceable by the Parties' heirs, spouse, dependents, successors, assigns, and all related parties and entities, as the case may be. 12. Governing Law. This Agreement shall be interpreted in accordance with the laws of the State of Illinois. 2125589_2 13. Effective Date. This Agreement shall be effective as of the date that the second Parry signs this Agreement. MERTES CLAIMANTS: VILLAGE OF MOUNT PROSPECT: ERIC MERTES Date: KENDRA MERTES Date: 2125589_2