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Is GM's Pension a Ticking Time Bomb for Taxpayers?

Excerpt: Here are the chief questions raised by the potential pension crisis: Could taxpayers really be on the hook for UAW pensions? Yes. GM could face a funding crisis in 2013 or 2014 when, under the current projections, the automaker will be required to make more than $12 billion in contributions to its pension funds to keep them solvent, according to the GAO analysis.

Why It's Time to Retire the 401(k)

Excerpt: If you have even peeked at your account statements in the past year, it's painfully obvious that something is wrong with the way we save. The tax-deferred 401(k) plan, and others like it, such as the 403(b) and the IRA, have become our nation's go-to retirement piggy bank. Invented nearly 30 years ago as an executive perk -- one more way to dodge Uncle Sam -- the 401(k) was never meant to replace the employer-guaranteed pension fund, supplemented by Social Security, as the cornerstone of our nation's retirement system. But propelled by a combination of companies looking to cut costs and consumers who wanted control of their retirement destiny, that's exactly what happened.

BlackRock Lifepath TDF Suit Dismissed Again, This Time with Prejudice

"[F]or at least one of the BlackRock Lifepath TDF suits, after giving the plaintiffs three opportunities to make their case, a federal judge has dismissed the suit — with prejudice.... The defendants here (again) are the fiduciaries of the Cisco Systems Inc. 401(k) plan[.]" [Bracalente v. Cisco Systems Inc., No. 22-4417 (N.D. Calif. Mar. 11, 2025)]

New Year Brings a Legal Challenge to Minnesota's Earned Sick and Safe Time Law

"[Airlines for America] claims that this newly revised provision could affect 'hundreds if not thousands of hours accrued by each employee,' by requiring all collective bargaining agreement negotiated paid sick leave or other time off to 'meet or exceed the minimum standards and requirements' of the ESST law.... [T]he asserted negative impacts of the recent change in Minnesota's ESST law are not limited to airline industry employers[.]" [Air Transport Assoc. of Amer., Inc., v. Blissenbach, No. 24-4657 (D. Minn. complaint filed Dec. 30, 2024)]

The Forfeiture Cases Keep Rolling In: This Time with a Solid Win for Defendants

"[T]he plan document had helpful language granting complete discretion to the plan sponsor to decide the amount of plan expenses it would pay each year. The court distinguished between the 'settlor' decision by the employer to pay or not pay expenses -- as a non-fiduciary decision.... The court also held that there was no 'transaction' that could be the basis of a prohibited transaction finding, because there was no risk of underfunding because of the employer's actions." [Hutchins v. HP Inc., No. 23-5875 (N.D. Calif. Feb. 5, 2025)]

Colorado Court of Appeals: Terms of Employer's Vacation Policy Control Whether Accrued, Unused Vacation Time Must Be Paid Out at Separation

"The case addressed an unsettled question under the Colorado Wage Claim Act -- namely, whether accrued, unused vacation time must be paid out at separation of employment where an employer's vacation policy states that it will not be. The Court of Appeals held that such time need not be paid out at separation ... [This] decision ... adds fodder to a judicial debate over payout of vacation time that is likely to be resolved by the Colorado Supreme Court in 2021." [Blount, Inc. v. Colorado Dept. of Labor and Employment, Division of Labor Standards and Statistics, No. 2018CA2455 (Col. App. Sep. 24, 2020)]

Colorado Decision Clarifies Payout of Unused Vacation Time

"Based on the court's holding, employers can write their policies to require employees to use or lose their accrued vacation time and also impose conditions for a payout at separation from employment.... [S]ilent or ambiguous policies may be interpreted as permitting rollover of vacation time or requiring compensation for accrued but unused vacation time at time of separation." [Nieto v. Clark's Market, Inc., No. 18CA1154 (Colo. Ct. App. Div. IV, Jun. 27, 2019)]

Supreme Court Indirectly Stiffens a Fiduciary Breach Time Limit and Helps ERISA Fiduciaries in the Process

"The Supreme Court appears to have barred equitable tolling under ERISA Section 413's six-year statute of repose for fiduciary breach claims, subject only to well-pled allegations and proof of fraud or concealment.... [T]he Court dismissed as untimely a securities case filed by CALPERS after the statute of repose expired. CALPERS argued that the lawsuit was timely because the same claim was timely asserted in another securities class action that CALPERS opted out of after filing its own case. The Court rejected the CALPERS argument that the timely filing of the class action equitably tolled statute of repose for its individual case." [CalPERS v. ANZ Securities, Inc., No. 16-373 (U.S. June 26, 2017)]

SeaWorld Cutting Hours for Part-Time Workers

"SeaWorld Entertainment Inc. is reducing hours for thousands of part-time workers, a move that would allow the Orlando-based theme-park owner to avoid offering those employees medical insurance under the federal government's health-care overhaul.... The company operates 11 theme parks across the United States and has about 22,000 employees -- nearly 18,000 of whom are part-time or seasonal workers.... SeaWorld will schedule part-time workers for no more than 28 hours a week, down from a previous limit of 32 hours a week. The new cap is expected to go into effect by November."

'Right-Sizing' Full-Time Employees to Reduce ACA Obligations May Lead to ERISA Class Action Exposure

"[W]hile the complaint includes claims for past and future health benefits and for 'incidental' lost wages, the opinion focuses on ERISA Section 510 and holds that the plaintiff has a viable claim that reducing her work hours was done for the purpose of interfering with her right to benefits under the company health plan. Second, the opinion finds that the complaint successfully alleged the employer's 'unlawful purpose' and intention to interfere with benefits, pointing to allegations that company representatives publicly stated that they were reducing the number of full-time employees to avoid ACA costs." [Marin v. Dave & Buster's, Inc., No. 15-3608 (S.D.N.Y. Feb. 9, 2016)]