Colgate-Palmolive retirees are asking a New York federal judge to approve a $332 million class action settlement resolving claims that the consumer products giant underpaid lump-sum retirement benefits. The deal would bring closure to a lawsuit stretching back almost a decade, one that reached the Second Circuit Court of Appeals last year.
The motion for preliminary approval, filed Friday, follows the parties’ June announcement that they had reached a resolution in the long-running Employee Retirement Income Security Act (ERISA) case.
Dispute Traced Back to 2005 Pension Plan Change
The retirees sued Colgate-Palmolive Co. in 2016, alleging the company improperly slashed defined-benefit payouts after a 2005 pension plan amendment. They claimed Colgate miscalculated residual annuities for workers who chose lump-sum payments, leaving them shortchanged.
Class certification came in 2017, followed by a partial summary judgment win for the retirees in 2020. The Second Circuit affirmed that partial victory in March 2023, ruling that calculation errors undervalued lump-sum benefits.
The 2005 amendment itself remained largely hidden until 2011, when workers learned of it through a separate ERISA class action against Colgate. That earlier case ended in a $45.9 million settlement, but excluded claims tied directly to the amendment.
