These days a pro-employer courtroom verdict is about as common as a Bigfoot sighting. That’s why what happened in this case is good news for companies everywhere.
A federal appeals court recently sided with Verizon Communications, Inc. in a case involving their retirement plan language.
Here’s what happened. When the company was moving workers from one pension plan to another, it accidentally included a multiplier tied to workers’ ages and years of service twice.
This mistake actually increased the starting balances for thousands of workers under the new plan and, in many cases, nearly tripled them.
However, when the company caught the mistake, several employees (with Cynthia Young as the lead plaintiff) cried foul. They sued, claiming the company should be bound by language in the plan.
The court disagreed, and Judge John Daniel Tinder wrote, “People make mistakes. Even administrators of ERISA plans.”
The company is allowed to fix the mistake, which could have cost it $1.67 billion.
Cite: Cynthia Young v. Verizon’s Bell Atlantic Cash Balance Plan
