County Can't Challenge Ruling That Its Retirement Plan Mistreated Older Workers

Pension & Benefits Daily™ covers all major legislative, regulatory, legal, and industry developments in the area of employee benefits every business day, focusing on actions by Congress,...

Nov. 3 — The U.S. Supreme Court announced that it won't hear a case asking whether Baltimore County, Md., violated federal law by requiring older workers to pay higher retirement contributions than younger workers who enrolled in the county retirement plan at the same time.

In March, the U.S. Court of Appeals for the Fourth Circuit found that the county's practice of mandating higher contributions from older workers violated the Age Discrimination in Employment Act.

The county argued that the “time value of money” justified the larger contributions from employees closer to retirement age, but the Fourth Circuit disagreed, finding instead that the county violated the ADEA by treating older employees less favorably than younger employees “because of” their age.

In January 2009, the U.S. District Court for the District of Maryland ruled in favor of the county, accepting its “time value of money” argument.

The Fourth Circuit vacated on appeal, finding that the lower court failed to consider the impact of a plan provision that allowed employees to retire based on their years of service without regard to age.

On remand, the district court ruled against the county on the ADEA claim, and the Fourth Circuit affirmed on appeal.

In its petition for Supreme Court review, the county asked whether an employer that sponsors a pension plan and utilizes one safe harbor under the ADEA is categorically prohibited from utilizing another safe harbor provision.

The petition was filed by Robert D. Klausner, Adam P. Levinson and Justin M. Sandowsky of Klausner, Kaufman, Jensen & Levinson, Plantation, Fla., and Michael E. Field and James J. Nolan Jr., of Towson, Md.

Text of the Fourth Circuit's decision is at http://www.bloomberglaw.com/public/document/EEOC_v_Baltimore_Cnty_No_131106_2014_BL_88975_4th_Cir_Mar_31_2014.