Reductions in Force: Strategies to Minimize Liability in Layoffs

Avoiding Inadvertent ERISA, Tax, and Labor and Employment Law Violations

Recording of a 90-minute premium CLE webinar with Q&A

Conducted on Tuesday, June 30, 2009

Program Materials

This seminar will discuss the legal risks in employee benefits that must be analyzed prior to implementing a Reduction in Force (RIF). The panel will outline best practices for implementing layoffs to avoid penalties and litigation over benefits issues.

Description

A struggling U.S. economy means that reductions in force (RIFs) are becoming a business routine. Employers find RIFs daunting on many levels, particularly in dealing with employee benefits issues and ensuring strict compliance with requirements to avoid legal liability.

When laying off employees, employers must carefully consider the ERISA, tax, and labor and employment law implications of their decisions. Counsel can guide employers on adequate precautions to avoid inadvertent legal violations that can lead to employee lawsuits.

Listen as our authoritative panel of employee benefits attorneys explains the issues that must be considered prior to implementing a RIF and offers effective strategies for avoiding penalties and litigation arising from employee benefits decisions during layoffs.

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Outline

  1. Pension plan considerations
    1. Anti-cutback rule for defined benefit plans
    2. Retroactive reductions or eliminations of defined contribution plans
    3. Partial plan termination/vesting implications
    4. Notice to participants
  2. Welfare benefits considerations (health plans, life insurance, disability plans)
    1. Notice to participants
    2. Union employees
    3. Public sector employees
    4. Making changes to plan design
    5. Voluntary benefits
    6. COBRA rules
  3. Miscellaneous benefits
    1. Unfunded benefits (vacation, sick leave, paid holidays, discount programs, mileage, tuition reimbursement)
    2. Government-mandated benefits (social security, workers comp, unemployment insurance)
  4. Severance benefits
  5. Best practices to avoid lawsuits and penalties
    1. Discrimination claims
    2. ERISA interference claims
    3. Breach of fiduciary duty claims
    4. 409A violations

Benefits

The panel will review these and other key questions:

  • What employee benefits issues should an employer consider in planning and implementing a Reduction in Force (RIF)?
  • How can employers avoid an inadvertent partial termination of their tax-qualified retirement plans when implementing a RIF?
  • What steps can employers take to reduce liability risks when making changes to healthcare plans?
  • How can employers determine in advance whether a severance arrangement may constitute an ERISA plan?

Faculty

James P. McElligott
James P. McElligott
Partner
McGuireWoods

Mr. McElligott handles employment, executive compensation and benefit related matters for corporations and public...  |  Read More

Steven J. Friedman
Steven J. Friedman
Shareholder
Littler Mendelson

He is Chair of the firm's Employee Benefits Practice Group. He advises employers on the structuring and implementation...  |  Read More

Randall C. McGeorge
Randall C. McGeorge
Counsel
White & Case

He counsels clients in the design and implementation of qualified and nonqualified retirement plans, equity incentive...  |  Read More

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