US SUPREME COURT ADRESSES PREGNANCY DISCRIMINATION ACT RETIREMENT BENEFIT CALCULATIONS
On Monday, May 18, the US Supreme Court issued another employment related opinion, this time dealing with the calculation of retirement benefits based on pre-Pregnancy Discrimination Act policies. In AT&T Corp. v. Hulteen (US Supreme Court 5/18/09) Justice Souter, in a 7-2 vote, delivered the opinion finding that AT&T's pension benefits, which were calculated in part under an accrual rule that was applied only pre-PDA, and gave less retirement credit for pregnancy than for medical leave generally did not necessarily violate the PDA. When the PDA became effective in 1978, AT&T changed it's policy to allow the same service credit for pregnancy as for other medical leaves of absence, but did not make the change retroactive, resulting in four employees suing AT&T because their pregnancy leaves resulted in smaller pensions. The Court found that since Congress did not apply the PDA retroactively, AT&T did not have to make it retroactive either. If the plaintiff's position had beeen upheld by the Court, it would have created a tremendous burden on companies to re-calculate pensions for women leaving the workforce now and in the near future, who were subject to pension rules similar to AT&T.
Practice Pointer. From time to time, courts need to address changes in the law that took place decades ago. It is important that companies review and revise their record keeping policies and procedures to comply with all applicable state and federal laws. Even when in compliance, records may be inadvertently destroyed that are needed later on.
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