Administration April 1, 2007

Time Warner to Up Independent Board Member Pay

January 28, 2005 (PLANSPONSOR.com) - Time Warner has doubled its annual cash retainer paid to non-employee board members, according to Dow Jones.
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The retainer for such board members now stands at $100,000 annually, according to the news services and was approved last week after consultation with an outside compensation adviser. The annual compensation also includes 8,000 stock options, as well as $75,000 worth of restricted stock units for each director.

This is a sizeable increase from the $50,000 paid to each independent director in 2003, the first year that the media giant began paying such board members. Along with the money, directors received similar stock options and restricted stock units as they will now.

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The new compensation packages will take effect at the 2005 annual shareholder’s meeting.

The company said that the alteration to pay reflects its corporate governance policy.    This provides that director pay should be mostly equity-based and set at around the 75 th percentile of the company’s peer group, according to Dow Jones.

Compliance March 30, 2007

Court Dismisses Former Law Firm Partners' Claim for Health Benefits

March 30, 2007 (PLANSPONSOR.com) - The U.S. District Court for the Eastern District of Michigan has dismissed claims a group of retired law firm partners brought against their former employer for discontinuing health care coverage.
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According to the order dismissing the suit, the partnership agreement under which the plaintiffs were seeking benefits is not a plan covered by the Employee Retirement Income Security Act (ERISA). The court pointed out ERISA does not apply to plans covering only owners or partners.

The court further stated that the law firm’s decision to halt medical benefits for both partners and employees, as well as the fact both partner and employee medical benefits were funded by the same insurance policy, do not negate that the retirees’ claims fall under the partnership agreement.

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After the law firm announced its decision to discontinue payment of health care benefits for active and retired partners and employees in 2002, ten retired partners filed an ERISA lawsuit claiming they were entitled to benefits. The district court dismissed the claims for lack of federal question subject matter jurisdiction.

The decision in Hayes, et. al. v. Lacey & Jones is here .

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