PNC Financial Services Group Inc., Philadelphia, was sued by a group of current and former employees who claim the firm violated ERISA when it converted its traditional pension plan to a cash balance plan in 1999, according to court papers. The complaint alleges the plan is worth far less to each employee under the cash balance formula and employees' benefits are reduced as they grow older. The plan had $1.4 billion in assets as of Dec. 31, 2003, according to the most recent annual report.
The suit, which seeks an undetermined sum, also names PNC Bank, the pension plan and the pension committee as defendants. The complaint said the plaintiffs named the plan "only so the court may award complete relief in the event of judgment for the plaintiffs."
The complaint, filed with the U.S. District Court in Philadelphia Dec. 30, said the "proposed class numbers in the tens of thousands." Paul Scarlato, partner with Goldman, Scarlato & Karon and an attorney for some plaintiffs, said the court has not set a scheduling order to consider assigning class status to the plaintiffs.
PNC spokesman Brian Goerke said the company does not comment on pending litigation.