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Rejecting actuarial heresy, the United States Supreme Court has refreshingly acknowledged that “People make mistakes. Even administrators of ERISA plans.” Specifically, the Court held that a single honest mistake in plan interpretation does not justify stripping the administrator of deference for subsequent related interpretations.
Continue Reading The Supreme Court Rejects Actuarial Heresy in Conkright v. Frommert

The Sixth Circuit has decided two new cases regarding ERISA lifetime retiree healthcare benefits under a collective bargaining agreement, continuing to put a thumb on the scale in favor of vested benefits, but recognizing that an employer may have the right to make “reasonable modifications” to those benefits.
Continue Reading More Case Law Regarding Documentation Required to Revise or Terminate Negotiated Retiree Healthcare Benefits

Do you sponsor any employee benefit plans that are required to be audited on annual basis? If yes, you should be aware that the DOL is targeting certain auditors and is seeking penalties from the plan administrator (typically, the employer) of up to $1,100 per day, or $50,000 per annual report, when it believes that the…

In Tackett v. M&G Polymers, USA, LLC, No. 07-4515/4516 (6th Cir. Apr. 3, 2009), the Sixth Circuit reversed dismissal of a retiree class action lawsuit, finding that the language in the Collective Bargaining Agreement demonstrated an intent to vest retiree medical benefits sufficient to survive a motion to dismiss.
Continue Reading An Important Reminder: Collective Bargaining Agreements Can Prevent Employers from Reducing or Terminating Retiree Medical Benefits

In a recent decision, the Sixth Circuit held that, even though eliminating labor costs (and by implication, costs of retirement benefits) was an incidental factor in a plant-closure decision, the decision did not violate the Employee Retirement Income Security Act (ERISA) because the motivating factor in the employer’s decision was production overcapacity.
Continue Reading Sixth Circuit Holds that Plant-Closure Decision Did Not Interfere with ERISA-Protected Pension Rights

In the first federal appellate decision addressing the new breed of ERISA “excess fee” cases, the U.S. Court of Appeals for the Seventh Circuit last week held, in Hecker v. Deere & Co that the Employee Retirement Income Security Act (“ERISA”) does not require an employer that sponsors 401(k) plans for its employees to disclose to plan participants that the plans’ investment advisor shared revenue with the affiliated plan trustee.
Continue Reading Revenue-Sharing of 401(k) Plan Fees Did Not Breach Fiduciary Duty Under ERISA

The Supreme Court recently issued a decision in Metlife v. Glenn, U.S., No. 06-923 where it considered: (1) whether a plan administrator has a conflict of interest when it both evaluates a claim for benefits and pays that benefit claim; and (2) how that conflict of interest should be taken into account by a court reviewing a discretionary benefit determination.

To answer the first question, the Court relied on its decision in Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101 (1989). The Court noted that in Firestone it held that a conflict of interest exists where the administrator “is the employer that both funds the plan and evaluates the claims” because “every dollar provided in benefits is a dollar spent by the employer; and every dollar saved is a dollar in the employer’s pocket.” Continue Reading The Supreme Court Upholds the Sixth Circuit in ERISA Conflict of Interest Case