Compliance April 23, 2007

AK Steel Pension Miscalculation Claim Upheld

April 23, 2007 (PLANSPONSOR.com) - A federal appeals court has upheld a ruling awarding at least $46.2 million to 1,250 former employees of AK Steel Holding Corp. who claimed the steelmaker miscalculated their pension benefits under an early retirement program.
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The decision of the three-judge panel affirmed the conclusion of a lower court (see  AK Steel Charged $46M for Miscalculated Pension Benefits ). 

The plaintiffs, who had retired or were terminated since January 1, 1995, sued the company in 2002.  They said that AK’s method of calculating lump sum payments to workers who had not reached full retirement age did not comply with federal law and resulted in underpayments for participants in one of its pension plans, according to the Associated Press.

AK Steel spokesman Alan McCoy said Friday that the company is considering appealing the ruling and has several options for an appeal, according to the report.

Another Retiree Challenge

AK Steel has another case pending in federal court, where about 4,600 retirees are challenging the company’s announcement last year that it would start charging a monthly premium for a portion of their health care insurance, which had been free (see AK Steel Retirees Ask Court to Bar New Health Care Plan) .

A judge has temporarily blocked AK Steel from imposing that change until the case goes to trial.  

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