Philip Morris Sacks Workers over Plan Withdrawals

May 24, 2006 (PLANSPONSOR.com) - Philip Morris USA has fired workers at its two US cigarette manufacturing plants over allegations they were not completely honest in their efforts to pull money from the company's profit-sharing plan, according to a news media report.

The Charlotte Observer reported that 14 people have been fired at the company’sConcord, North Carolina plant for taking out hardship withdrawals for homes that were not listed on the initial application or for using the money for something other than buying the home they initially intended to purchase.

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Philip Morris spokesman Bill Phelps told the newspaper that workers can be let go because of any falsification, misstatement or omission of information related to plan transactions. That message was part of a May 4 memo posted on company bulletin boards that also told employees the plans are subject to strict Internal Revenue Service and Labor Department rules and regulations, according to the news report.

Interviews and a list compiled by workers suggest as many as 70 workers have been cut since last fall for allegedly falsifying applications to make withdrawals. TheConcord plant employs 2,600 people.

Fired workers told the Observer that neither Philip Morris nor plan administrator Fidelity Investments raised concerns until recently. Many of the withdrawals the company cited as firing offenses were made several years ago, documents obtained by the newspaper showed.

Employees can use hardship withdrawals to buy a primary residence, to prevent eviction or foreclosure, or for certain medical and educational purposes. An employee is allowed to make a hardship withdrawal only after he or she has received loans from the plan.

Several former workers said they were fired because they applied for a withdrawal to buy one house and ended up getting a different one. Others said they planned to buy a house but later decided not to. They said they tried to give the money back to Fidelity but were told they could not.

MA Officials Pay $1.2M in Age Discrimination Case

May 23, 2006 (PLANSPONSOR.com) - The Commonwealth of Massachusetts has paid out $1.26 million to 15 plaintiffs as part of a long-running battle over allegations that the state illegally denied older workers the right to apply for accidental disability retirements.

An announcement from the USEqual Employment Opportunity Commission (EEOC) said that as a result of its lawsuit against state officials, the state, local and municipal employees will also get an additional $165,176 every year – raising the state’s ultimate payout to several million dollars.

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The EEOC said Tuesday’s announcement ends years of litigation in which the EEOC sued Massachusetts repeatedly for its retirement system’s violations of the Age Discrimination in Employment Act (ADEA). The EEOC said the Commonwealth amended its retirement statute to drop out provisions found to be discriminatory in 2000.

The original settlement, which extended back to October 16, 1992, provided accidental disability retirement pensions to all those otherwise eligible who were either denied, or discouraged from applying for these pensions solely because their ages exceeded Massachusetts’s maximum age limitations.

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