(Host) Vermonters who spearheaded the opposition to changes in IBM’s retirement plan are pleased with a court ruling calling on the company to compensate employees affected by the plan. They say the decision is significant for workers at other companies.
VPR’s Steve Zind reports.
(Zind) When IBM adopted what is called a cash balance pension plan in the late 1990s, employees complained that the change from a traditional pension plan unfairly penalized older workers. They said some people could see their retirement pay cut by up to fifty percent. Last year, a U.S. District court ruled that IBM’s decision amounted to illegal age discrimination. Now the court has ruled that the company must make retroactive payments to employees.
Four years ago, a group of employees at the IBM plant in Essex Junction led the effort to fight the new pension plan. Representative Bernie Sanders attended an IBM meeting in Cleveland to urge stockholders to reject the company’s decision. IBM is the largest of a growing number of firms that have adopted cash balance pension plans. For that reason, Sanders says the court ruling will have a big impact.
(Sanders) “We think that that is going to have an impact all over this country for many, many companies.”
(Zind) IBM says the company’s plan is legal and it is appealing the court rulings. Jimmy Leas is a former employee at the Essex Junction plant. Leas says, he’ll introduce a resolution at IBM’s shareholders meeting next month calling on the company to drop its appeals.
(Leas) “We’re asking IBM do the right thing, to do what the court told IBM to do. IBM is saying, ‘no, we’re going to appeal this decision.’ And we’re saying, ‘IBM don’t appeal. Just do it’.”
(Zind) A spokesman at IBM in Essex Junction says it’s unclear how many of the plant’s employees are affected by the ruling.
For Vermont Public Radio, I’m Steve Zind.