Now is the time to consider opportunities to manage global pension cost and risk. Many employers have already frozen their defined benefit plans and implemented defined contribution plans. Of course, such cost-reduction strategies may raise employment law issues in non-US jurisdictions because of the Acquired Rights Directive in EU jurisdictions and similar legislation elsewhere. In considering any such change, an employer has to consider how such change will be communicated to employees and employee representatives,…
Almost all plan documents contain some level of administrative provisions outlining how the plan is intended to operate (e.g., number of committee members, quorum, etc.). Plan sponsors often view these provisions as “boilerplate” with little or no meaning. In actuality, these are substantive provisions of the plan and failure to follow those provisions can have substantial consequences. The Consequences Failure to follow the terms of the plan document is a potential qualification issue under IRS…
On June 1, 2017, the United States Court of Appeals for the Fifth Circuit, in Langley v. Howard Hughes Mgmt. Co., L.L.C., 694 F. App’x 227 (5th Cir. 2017), held that William Langley, a former golf club executive, was entitled to receive approximately $255,000 in severance pay, plus attorney’s fees. The Court found that the administrator’s interpretation of a severance plan, which resulted in denying the former executive’s claim for severance pay, was an abuse…