4 pages. Excerpt: In a closely watched case involving the Smith Barney Capital Accumulation Plan, the California Supreme Court has ruled unanimously that state law does not prohibit an employer from forfeiting an employee's incentive compensation when the employee quits or is terminated for cause before the date that the compensation vests. Schachter v. Citigroup, Inc., No. S1611385, 2009 Cal. LEXIS 11056 (Nov. 2, 2009). But in dicta, the court suggested an exception to its ruling: If an employee is terminated without cause, then the employee still may be entitled to a pro rata share of the compensation at issue. The court did not elaborate on what would constitute 'cause' in this context, whether the reason for the termination would make a difference, or whether an express provision in the incentive-compensation plan would eliminate the potential exposure. It therefore is unclear how far this exception may go.  MORE >>