Key facts
- AT&T agreed to pay $184.1 million to settle a class-action lawsuit.
- The lawsuit accused AT&T of shortchanging about 300,000 current and former employees on pension payments.
- Employees alleged the company violated ERISA by failing to provide married workers with pension payments that were the actuarial equivalent of those for single workers.
- The company allegedly used outdated mortality data to calculate payments, resulting in lower amounts for married workers.
- The settlement includes $149.1 million in additional pension benefits for employees, with $113.5 million for retirees and $35.6 million for current employees.
- AT&T denied wrongdoing but settled to avoid the expense and distraction of litigation.
AT&T has agreed to pay $184.1 million to settle a class-action lawsuit that accused the telecommunications company of shortchanging approximately 300,000 current and former employees on their pension payments. The preliminary settlement, filed in San Francisco federal court, requires judicial approval.
The lawsuit, initiated in October 2020, alleged that AT&T violated the Employee Retirement Income Security Act of 1974 (ERISA). Specifically, employees claimed the company failed to provide married workers with pension payments that were the actuarial equivalent of those given to single workers. According to the suit, AT&T used decades-old mortality data to calculate payments, leading to lower amounts for married employees.
Under the terms of the proposed settlement, employees would receive $149.1 million in additional pension benefits. This includes $113.5 million designated for retired employees and $35.6 million for current employees. The legal team representing the employees may seek up to $35 million for fees and costs.
AT&T has denied any wrongdoing, stating that the decision to settle was made to avoid the expense and distraction of prolonged litigation. The company affirmed its commitment to complying with the law in administering its pension benefit plan.