Baltimore County, Md., agreed to pay about $5.4 million to resolve a federal age discrimination lawsuit regarding the county's $2.8 billion pension fund filed by the Equal Employment Opportunity Commission.
The settlement will be paid to more than 2,000 retirees who paid higher contribution rates into the pension fund than they should have, according to an April 24 EEOC news release. The lawsuit dates back to 2007.
When the Baltimore County Employees' Retirement System, Towson, Md., was created in 1945, the county's actuarial firm at the time based its calculations for employee contribution rates on the number of years that an employee would contribute to the plan before being eligible to retire at age 65. The firm ultimately concluded that older employees who enrolled in the plan should contribute a higher percentage of their salaries because their contributions would earn interest for fewer years than younger employees' contributions, according to court documents.
Between 1945 and 2007, the employee contribution rates were amended only once — in 1977 — but the fact that rates were based on an employee's age at the time of plan enrollment and were higher for older employees did not change.
The EEOC in 2007 filed a lawsuit against the county on behalf of two correctional officers. Since then, decisions have been made and appealed, including a 2016 ruling that said the county was not required to pay back the workers. The EEOC appealed and the 2016 ruling was reversed in 2018.
In 2019, the U.S. Supreme Court declined to hear the case.
"We are pleased that thousands of retirees who overpaid for their pensions, some for many years, are finally being reimbursed," said Maria Salacuse, EEOC supervisory trial attorney, in the news release. "We appreciate the willingness of the county and the trustees of the retirement system to bring this case to resolution."
A Baltimore County spokesman said in an email that the joint consent order has been filed "and the court has entered an order dismissing the matter. The county has no further comment."