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| Friday, November 20, 2009 |
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ANALYSIS
March 2, 2009
Sagging Index no longer reflects what’s going on in the market, some say, Replacements? Google it, to start.
March 2, 2009
Downward price spiral will actually boost the cost of capital for most companies. CFOS, take note.
March 2, 2009
The latest bailout at AIG could be a preview of how the president will deal with Wall Street.
March 2, 2009
No corporate defaults. Big debt offerings. Percolating CP issuance. Things may be looking up in the capital markets.
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July 10, 2008 12:57 PM ET
(Business Insurance)—Joining three other federal appellate courts, the 2nd U.S. Circuit Court of Appeals ruled Wednesday that cash balance pension plans do not violate federal age discrimination law. In a unanimous decision, the appeals court affirmed two separate lower court rulings finding that cash balance plans sponsored by Verizon Communications Inc. and Equitable Life Assurance Society—now known as AXA Equitable Life Insurance Co.—do not discriminate against older workers. Closely following other court rulings on the issue, the 2nd Circuit said while the benefits provided to younger employees are worth more than the same benefits provided to older employees—in terms of a retirement age annuity that could be purchased—that difference is the result of time and compound interest and does not constitute age discrimination. The 2nd Circuit is the fourth appeals court to rule that cash balance plans are not age discriminatory. In an August 2006 landmark ruling the 7th U.S. Circuit Court of Appeals overturned a 2003 decision by a federal judge in Southern Illinois that IBM Corp.’s cash balance plan discriminated against IBM’s older workers. Last year, two courts—the 3rd U.S. Circuit Court of Appeals in a case involving Pittsburgh-based PNC Financial Services Inc. and the 6th U.S. Circuit Court of Appeals in a case involving World Color Press Inc.—also rejected age discrimination charges. All the courts have rejected the argument made in numerous suits that the plans are age discriminatory because the same earned benefit will produce a smaller retirement-age annuity for older employees than younger employees. The appeals courts’ rulings, coupled with a 2006 federal law that protects new cash balance plans from age discrimination suits “should be the death knell of cash balance plan litigation,” said Nancy Ross, partner with McDermott, Will & Emery L.L.P., in Chicago. Ms. Ross represents AXA Equitable. The decisions “will quash participants’ desires to challenge these plans. We haven’t seen new litigation in this area for some time,” Ms. Ross said. Still, there is at least one more appeals court to be heard from on the issue. The 9th U.S. Circuit Court of Appeals soon is expected to rule on a lower court ruling dismissing age discrimination charges against Southern California Gas Co.
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