The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site.

All material subject to strictly enforced copyright laws. © 2021 Euromoney, a part of the Euromoney Institutional Investor PLC.

Pension ruling will affect top US corporates, warns IBM

The pension plans of top US corporates have taken a collective knock, according to IBM, after a federal court ruled that IBM violated age discrimination provisions after the company changed its pension plans during the 1990s. It is planning to appeal.

 

"IBM has a long history of providing pension benefits for its employees. We defended this lawsuit to preserve the current pension plan," says J. Randall MacDonald, IBM senior vice president of human resources. "This ruling affects not just IBM's pension plan, but the pension plans of more than 400 major US companies. This is a situation where a few have spoiled it for millions of US workers."

 

Two changes in the IBM pension plan led to the company offering concessions to older employees in 1999, but Judge Patrick Murphy ruled the concessions did not provide enough compensation. The last change, to a cash-balance plan, combined different features from varying pension plans. An IBM press release comments: "Under the court's interpretation of the law, every cash balance in the country is illegal. Scores of Fortune 500 have such plans."

You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.

SUBSCRIBE ONLINE TODAY

Unlimited access to Euromoney.com and Asiamoney.com

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually

FREE 7 DAY TRIAL

Unlimited access to Euromoney.com and Asiamoney.com, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors

LOGIN NOW

Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree