The Year of Top Hat Plan Litigation

“Former employees who terminate employment after having satisfied the minimal vesting requirements of ERISA, but before satisfying the more restrictive vesting requirements of their former employers’ non-qualified plans, have figured out (actually, their lawyers have figured out) that challenging a non-qualified plan’s status as a top hat plan can be an effective way to collect additional dollars. And some federal courts, including Texas, of all places, have been sympathetic to these challenges. Unfortunately, these types of allegations have become fairly common in recent years.” (Winston & Strawn LLP)