The Labor Department is proposing an exemption to allow Ford to transfer company stock into a new health care trust to help fund benefits for retirees.

Ford Motor Co.'s health care trust would cover 285,000 retirees and dependents. The government needs an exemption from provisions of a federal law prohibiting such benefit plans from holding large assets in the form of employer securities.

The department has filed similar requests for General Motors and Chrysler. The three automakers have set up a voluntary employees beneficiary association, or VEBA, to pay for the health care costs of retirees.

The proposal would create a board to oversee the trust and set policies for the health care funds.