News Notes: Federal Court Defines Duty To Notify Employees About Proposed Benefit Plan Changes

We reported in April on a federal court decision from Kentucky involving IBM which held that under federal law, if you’re seriously considering changes to a retirement benefit plan, you must tell your employees. Now, in a pair of new cases, the federal Ninth Circuit Court of Appeal has reached the same conclusion, explaining that you must answer employee questions truthfully and reveal information about possible plan changes even if you’re not asked. The cases involved workers who claimed they wouldn’t have accepted early retirement incentives if they had known their employer was considering an enhanced package. To avoid disputes, it’s critical to follow the three guidelines spelled out in the April CEA story on how to determine when your duty to notify employees has been triggered.