By Jacklyn Wille July 12 — Two more employees have sued RBC Capital Markets LLC over its wealth accumulation plan, alleging that the company wrongfully withheld nearly $2 million in benefits by failing to run the plan in accordance with federal law ( Paul v. RBC Capital Markets LLC , W.D. Wash., No. 3:16-cv-05616, complaint filed 7/11/16 ). In a lawsuit filed July 11, the employees argue that RBC's wealth accumulation plan doesn't qualify as a “top-hat plan”—that is, a plan exempt from certain worker protection laws because it's intended to benefit only highly paid executives. According to former RBC employees Marty Paul and Brian Buskirk, RBC's failure to operate the plan in compliance with ERISA's vesting and funding requirements deprived them of benefits totaling about $1.6 million and $300,000, respectively. A lawsuit bringing similar claims against the company is heading to trial after a federal appeals court issued a decision largely favoring RBC employees in 2014. In May, the judge hearing that case declined to certify it as a class action. Disputes over top-hat plan status don't arise frequently in ERISA litigation. Even so, the question has drawn the attention of the Department of Labor, which in 2015 asked a federal appeals court to adopt a narrow definition of top-hat plans. In the department's view, only managers and highly compensated employees can participate in top-hat plans. If a plan allows other employees to participate, the plan must comply with the worker protections set by ERISA. That case—which involved a plan sponsored by hotel giant Marriott International Inc.—was resolved on other grounds by the U.S. Court of Appeals for the Fourth Circuit in January. The employees suing RBC are represented by Yarmuth Wilsdon PLLC. RBC didn't immediately respond to Bloomberg BNA's request for comments. To contact the reporter on this story: Jacklyn Wille in Washington at jwille@bna.com To contact the editor responsible for this story: Jo-el J. Meyer at jmeyer@bna.com Copyright © 2016 The Bureau of National Affairs, Inc. All Rights Reserved.
RBC Capital Markets has received another lawsuit regarding its wealth accumulation plan. Two more employees have sued the firm for wrongfully withholding about $1.6 million and $300,000 in benefits after failing to run the wealth accumulation plan in accordance with federal law. The case comes as RBC prepares to defend itself in a trial bringing similar claims against the company.