Quitting a habit is supposed to be rewarded. For some 7-Eleven workers, the reward allegedly never fully arrived. 7-Eleven Inc. will pay $2.3 million to settle a proposed class action alleging it violated federal benefits law by failing to let tobacco-using employees who completed a cessation program totally avoid a $720 annual health plan fee, according to a filing in Texas federal court.

The Request for Court Approval

Former employee Barbara Baker asked the court Tuesday to grant preliminary approval of the deal, which would resolve her Employee Retirement Income Security Act lawsuit.

Where the Money Would Go

According to the motion, Baker’s counsel may seek up to 33% of the settlement fund in attorney fees, and Baker may ask for a $7,500 case contribution award. The remaining sum would be distributed to a settlement class that includes any plan participant who paid a tobacco surcharge after September 2018 and was not fully reimbursed.

The Surcharge at the Center of the Case

Baker alleged in her September 2024 lawsuit that 7-Eleven employees who used tobacco were charged $14 per paycheck, or $720 a year, to stay insured under the company’s health plan. That fee, she said, violated ERISA’s antidiscrimination protections because some tobacco-using participants who completed the cessation program after a certain date did not receive the “full reward.”

A Notice Problem, Too

Baker also claimed the company failed to notify workers about the program in all of its plan communications, as the law requires.

How the Case Reached a Deal

U.S. District Judge Brantley Starr denied 7-Eleven’s motion to dismiss in February. The convenience store chain and Baker told the court in August that they had agreed to end the suit, setting the stage for this week’s filing.

For workers who paid the surcharge after completing a program meant to erase it, the settlement now awaits a judge’s first approval, the next step before any money changes hands.