abstract:A defined benefit pension plan is a type of pension plan in which an employer/sponsor promises a specified monthly benefit on retirement that is predetermined by a formula based on the employee's earnings history, tenure of service and age, rather than depending directly on individual investment returns. Traditionally, many governmental and public entities, as well as a large number of corporations, provided defined benefit plans, sometimes as a means of compensating workers workers in lieu of increased pay.
Theywould also have hybridplans, with partof the traditionaldefined-benefitpensionreplaced by a defined-contributionplanof the sort common in the privatesector.
Ultimately, the sides settled upon a plan proposed by the NFL, wherein the current officials will retain the definedbenefitpensionplan until 2016, or until the official earns 20 years of service.
Workers Wayne Tomlinson, Alice Ballesteros and Gary Muckelroy brought the suit in 2004, arguing that by switching its definedbenefitpensionplan from a final average pay formula to a cash balance formula, El Paso set payments for older, longer-service employees at significantly lower levels.