Employees entitled to individual relief for misleading communications
Article Abstract:
The Supreme Court ruled in 'Varity Corp. v. Howe' that an employer acting as sponsor and administrator of an ERISA plan acts as a fiduciary whose breach of duty entitles the participants to individual relief. Massey-Ferguson Inc., a Varity Corp. subsidiary, deceived its employees in withdrawing from their old plan and changing employers, thereby forfeiting the benefits due them. Iowa District Court's decision in favor of the employees was affirmed by both the US Court of Appeals and the Supreme Court.
Publication Name: Journal of Compensation and Benefits
Subject: Insurance
ISSN: 0893-780X
Year: 1996
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Fiduciary liability for inadequate insurance coverage
Article Abstract:
The Dept. of Labor (DOL) sued Continental Insurance Co. for charging the Hotel Employees and Restaurant Employees Union Pension and Welfare Plans $970,000 in premiums for two years of coverage worth only $1 million. The DOL argued that although Continental is not liable under ERISA because it was a nonfiduciary, it should be punished for complicity in the trustees' breach of trust. The Supreme Court refused to review the 7th Circuit Court's ruling in favor of Continental.
Publication Name: Journal of Compensation and Benefits
Subject: Insurance
ISSN: 0893-780X
Year: 1995
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An overview of "synthetic-GICs." (guaranteed interest contracts)
Article Abstract:
The synthetic guaranteed interest contract (GIC) is a type of investment product used in benefit plans in which the retirement benefits are invested into income-generating securities. Insurance companies and banks handling such contracts provide an assurance that principal values are protected. The advantage of synthetic-GICs is that there is a guaranteed interest rate, and that it also allows the participant to invest in a wide range of securities.
Publication Name: Journal of Compensation and Benefits
Subject: Insurance
ISSN: 0893-780X
Year: 1995
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