WASHINGTON, April 3, 2019 /PRNewswire/ -- A new compilation of court records by Good Jobs First finds that large corporations have paid out $6.2 billion in class-action lawsuits in which employees claimed that companies acted improperly in the administration of their 401(k) or defined-benefit pension or retiree health plans. That's the total of 201 settlements and verdicts since January 2000 involving corporations in the Fortune 1000, the Fortune Global 500 and the Forbes list of America's Largest Private Companies.
The largest settlement, $480 million, was reached in 2014 in a retiree health benefits suit brought against Daimler on behalf of workers at the German company's U.S. truck manufacturing plants.
The case information was assembled by the Corporate Research Project of Good Jobs First as part of the latest expansion of Violation Tracker, the first wide-ranging database of corporate misconduct (available at violationtracker.org).
"Class actions have become an essential way for workers to protect their retirement benefits against employer abuses," said Good Jobs First Research Director Philip Mattera, who leads the work on Violation Tracker.
All 201 cases were brought under the Employee Retirement Income Security Act of 1974, or ERISA. The lawsuits alleged various types of misconduct by employers, including:
* Charging excessive fees or offering overly risky investment options in 401(k) plans;
* Improper investment of pension plan assets in company stock, especially during times of instability;
* Inadequate disclosure of financial information to plan participants; and
* Mishandling conversions of pensions to cash-balance plans.
Some suits were brought against investment managers or plan trustees rather than the employer. For example, Bank of New York Mellon agreed to a $335 million settlement to resolve allegations by multiple pension funds that it overcharged them on currency exchange rates relating to the purchase of foreign securities.
Apart from Daimler and Bank of New York Mellon, 13 other large corporations have had total ERISA payouts of $100 million or more. Among them: IBM, Foot Locker, Xerox, Bank of America, AK Steel, AT&T and JPMorgan Chase. The industry with the most ERISA payouts is banking, with a total of $1.3 billion.
In many cases settlement costs are covered by an insurance policy, but Violation Tracker attributes the amount to the corporation named in the lawsuit.
Violation Tracker contains 368,000 civil and criminal entries with total penalties of $464 billion.
Contact: Philip Mattera (202-725-7906); firstname.lastname@example.org
SOURCE Good Jobs First