Présentation de l'éditeur
While certain district court decisions have held that cash balance plans violate the age discrimination provisions, all appellate courts to evaluate this issue have found that the plans are not age discriminatory. In a case that has received significant attention, Cooper v. IBM Personal Pension Plan, 457 F.3d 636 (7th Cir. 2006), the Seventh Circuit reversed one of the district courts and found that IBM’s cash balance plan did not violate ERISA’s age discrimination provision.
The Pension Protection Act of 2006 (P.L. 109-280) sets out new standards that a cash balance plan must meet in order to comply with the age discrimination provisions. These new standards apply only to periods beginning on or after June 29, 2005, and leave the age discrimination issue unsettled under prior law.
This report describes cash balance plans, discusses the claims that cash balance plans do and do not violate the pre-Act age discrimination provisions, and provides an overview of the Pension Protection Act, as it applies to this issue.