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ARTICLE · 24 JUNE 2024

Salesforce Settles ERISA Class Action With 50K Workers

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Just a week before a bench trial was scheduled to begin, Salesforce reached a settlement with as many as 50,000 of its employees in a class action lawsuit over its 401(k) plan.

United StatesEmployment and HR
Hall Benefits Law
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Just a week before a bench trial was scheduled to begin, Salesforce reached a settlement with as many as 50,000 of its employees in a class action lawsuit over its 401(k) plan. The San Francisco-based software company faced claims of breach of its fiduciary duties under ERISA for failing to replace costly and underperforming investment options in the 401(k) plan. The workers had sought over $5 million in damages, plus prejudgment interest, to be divided among the plan participants in proportion to their account losses.

A group of former workers initially filed suit against Salesforce, its board of directors, investment committee, and executives in March 2020, claiming breaches of fiduciary duties under ERISA concerning their 401(k) plan. They claimed that Salesforce acted imprudently in retaining higher-cost versions of certain investment funds instead of investigating lower-cost, better-performing options.

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