"The lawyers' timeliness, as well as their knowledge of our business make them a critical partner to us. My company is extremely satisfied with the work Calfee has done for us. They are thorough, creative, and responsive."
Client quote, Chambers USA
Overview
Calfee's nationally recognized Employee Benefits and Executive Compensation practice group advises business and governmental clients on managing their most challenging legal and business issues related to benefits and compensation.
In addition to extensive experience with tax-qualified retirement and employee health and welfare benefit plans, the group’s practice also has a significant focus on the design and implementation of sophisticated executive compensation programs, ESOPs, merger and acquisition matters, and ERISA litigation.
We are experienced in all types of benefit plans, including defined benefit pension plans, 401(k) plans, ESOPs, executive compensation arrangements, welfare plans, Voluntary Employees’ Beneficiary Associations (VEBAs), governmental plans, church plans, 403(b) plans and 457(b) plans. Areas of recent growth include forming ESOPs and pooled employer plans and negotiating pharmacy benefit management contracts.
Calfee represents publicly and privately held corporations, nonprofit organizations, banks and trust departments, and government entities in all phases of designing and administering employee benefit programs and related tax and fiduciary duty issues.
Calfee regularly advises large employers and governmental retirement systems on designing and administering their employee benefit plans, including drafting plan documents and summary plan descriptions, administering claims requests and appeals, and negotiating with recordkeepers, third-party plan administrators, pharmacy benefit managers, and other service providers.
In addition, Calfee advises clients with large pension plans and 401(k) plans on matters related to the investment of their plan assets, such as investment manager and adviser arrangements, investments in private equity and hedge funds, transition management arrangements, and compliance with regulatory requirements.
Noteworthy
Chambers USA Leading Law Firm Rankings
Since 2008, Calfee has been recognized as a Leading Law Firm for Employee Benefits & Executive Compensation by Chambers USA, most recently in Band 2 in Ohio (2023).
Clients provided feedback to Chambers USA researchers, "The firm is very responsive and offers hands-on involvement from partners. The lawyers have represented our interests very well in discussions and negotiations with third parties. The team knows our business well after years of service. The lawyers' timeliness, as well as their knowledge of our business, make them a critical partner to us. My company is extremely satisfied with the work Calfee has done for us. They are thorough, creative, and responsive. I have been impressed by the team and have strong confidence in its work and capabilities. I value responsiveness, and they have delivered that on a consistent basis. The team has a strong knowledge of benefit plans and an amazing ability to link things together. The Calfee team delivers excellent work."
U.S. News – Best Lawyers® “Best Law Firms” Rankings
Calfee was selected for inclusion in the 2023 "Best Law Firms" rankings by U.S. News – Best Lawyers in Litigation – ERISA (National Tier 2, Regional Tier 1 Cleveland) and Employee Benefits (ERISA) Law (Regional Tier 1 Cleveland).
Professionals
Professionals
Chair, Investment Management
Experience
Experience
Executive Compensation
- Employment and consulting contracts
- Equity and phantom equity compensation plans
- Incentive compensation/bonus plans
- Non-qualified deferred compensation (Section 409A)
- Change in control arrangements
- Supplemental executive retirement plans
- 401(k) wraparound plans
- 457(b) plans
- Executive perquisites
- Public disclosure and reporting requirements for publicly held companies
Qualified Retirement Plans
- 401(k) plans
- Pension, profit sharing, stock bonus plans and 403(b) plans
- Individual Retirement Accounts (IRAs)
- Cross-tested plans
- Cash balance plans
- IRS approval process
- Plan design and documentation
- Coverage and nondiscrimination testing support
- Governmental retirement plans
- Church retirement plans
Health and Welfare Benefits
- Self-insured health plans
- Health Savings Accounts
- Health Reimbursement Accounts
- Pharmacy Benefit Management (PBM) arrangements
- Retiree Health Plans
- Medicare Parts C and D
- Employer Group Waiver Plans (EGWPs)
- Cafeteria (Section 125) Plans
- Flexible benefit plans
- VEBAs
- Governmental health plans
- Church health plans
- Affordable Care Act compliance
Investment Management
- Investment Management Agreements for separate accounts
- Investments in private equity funds, hedge funds, real estate funds, collective investment trusts, infrastructure funds
- Arrangements with 3(38) and 3(21) fiduciary managers and advisors
- Transition management arrangements
- CFTC, NFA, and ISDA compliance
- Investment policy statements
Regulatory Compliance
- Regulatory interpretation
- Fiduciary compliance
- Reporting and disclosure
- Investment management compliance
- ACA, HIPAA, and COBRA compliance
- IRS and DOL audits
- IRS and DOL correction programs
Mergers and Acquisitions
- Transaction structuring
- Compliance and liability analysis
- Defined benefit and multi-employer plan liabilities
- Plan mergers and spin-offs
ESOPs
- Alternative equity transfer techniques
- Analysis of stock redemption issues
- Assistance in obtaining appraisals and financing
- Corporate governance and equity issues
- S corporation ESOPs
- Phantom and synthetic equity arrangements
ERISA Litigation
- Disputed benefit claims (administrative proceedings and litigation)
- Breach of fiduciary duty claims
- Discrimination claims under ERISA Section 510
- COBRA claims
- Multi-employer withdrawal liability claims
- Department of Labor proceedings
Representative Clients
Representative Clients
A list of Calfee's representative Employee Benefits and Executive Compensation practice clients includes the following:
- Align Capital Partners
- American Consolidated Industries
- Americhem, Inc.
- Automated Packaging Systems, Inc.
- CW Industrial Partners LLC (formerly CapitalWorks, LLC)
- The Catholic Diocese of Cleveland
- Chart Industries, Inc.
- Clark-Reliance Corp.
- Clearstead Advisors LLC (formerly known as Hartland & Co.)
- Covia Holdings Corporation
- Ferro Corporation
- Hartzell Propeller Inc. / Tailwind Technologies, Inc.
- Hickok Incorporated
- Hyland Software, Inc.
- Invacare Corporation
- The J. M. Smucker Company
- Keller Group, Inc.
- Key Bank Investment Services
- Kirkwood Holding Inc.
- Koroseal RJF International Corporation
- Linsalata Group
- MarshBerry
- MavenHill Capital
- Medical Mutual of Ohio
- Mettler-Toledo
- Morrison Products, Inc.
- MYR Group, Inc.
- Nestlé USA, Inc. and Nestlé Holdings, Inc., and related companies, including Nestlé Prepared Foods Co., Nestlé Purina Petcare Company and Nestlé Healthcare Nutrition, Gerber Products Company, Gerber Life Insurance Co. and Nestlé Dreyers Ice Cream Company
- Oatey Co.
- Ohio Highway Patrol Retirement System
- Oswald Companies
- Playhouse Square Foundation
- Royal Appliance Manufacturing Company
- RPM International Inc., and related companies, including Tremco Incorporated, Carboline Company, Day-Glo Color Corp. and Dryvit Systems, Inc., Rust-Oleum Corporation, DAP Products, Inc., and Zinsser Co., Inc.
- School Employees Retirement System of Ohio
- State Teachers Retirement System of Ohio
- Tradesmen International, LLC
Recent Matters
Recent Matters
- Advised a large public utility with the following:
- Voluntary early retirement incentive programs during 2019 including design modifications, compliance with IRS regulations, drafting appropriate plan amendments to the pension plan, and assisting with issues that arose while the incentive program was being implemented. The plan was very well received by plan participants with an over 80% acceptance rate.
- An annuity lift-out program where the company Master Pension Plan purchased an annuity contract from an assurance company for approximately 130 million USD to fund retirement benefit payments for certain retirees. A full range of sophisticated advice was needed for the project including plan design, compliance, drafting, negotiating and reviewing the terms of the annuity contract, and preparation and adoption of a pension plan amendment.
- Executive compensation and employee benefit matters in connection with bankruptcy filing for certain subsidiary operating companies, including designing incentive compensation agreements with executives at subsidiaries and spinning off a portion of 401(k) plan to a company being sold out of bankruptcy.
- HIPAA-compliance matters related to business associates and issues that arose in the transmission of electronic protected health information related to its group health plan for 65,000 participants.
- Review and negotiation of investment arrangements for a multibillion-dollar pension trust. Regularly advise on investments in hedge funds, private equity funds, real estate funds, and other types of investments. Regularly advise on day-to-day operational and fiduciary issues with the administration of a pension trust. Recently advised on reviewing and negotiating annuity contracts with insurance carriers related to transferring approximately $250 million in liabilities from the pension trust to the carriers.
- Advised a multinational food manufacturer with:
- A multibillion-dollar 401(k) plan trust and pension plan trust with respect to entering into investment management agreements for separate accounts as well as services agreements with investment advisers. We also advised the client with respect to both anticipated changes for plan sponsors under the fiduciary rules for investment advisers as they originally were to have become effective in 2017 under Department of Labor regulations, as they were then partially postponed and modified, later enjoined, and have now become the subject of new Department of Labor and Securities Exchange Commission regulatory projects. The engagements under the plans required reviewing and negotiating investment advisory and services agreements with the financial institutions. Calfee was successful in providing the client with additional protection under the agreements related to the advisers' fiduciary status, standard of care, data protection, and indemnification, among other items. Calfee also advised the client on revising its International Swaps and Derivatives Association (ISDA) master agreements with its investment managers to implement changes under new collateralization requirements for swaps and derivatives in the European Union.
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The operational and compliance issues underlying the client's health and welfare benefit plans for approximately 50,000 employees.
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Drafting and negotiating multi-billion-dollar service agreements with its pharmacy benefit manager for prescription drugs under its group health plan for active employees and its retiree medical plan.
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Drafting and negotiating a series of service agreements with vendors providing voluntary benefits programs, such as pet insurance, legal services, and home and auto insurance.
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Advising on implementing changes to its group health plan that were required or permitted under federal and state law in response to the COVID-19 pandemic, including the Coronavirus Aid, Relief, & Economic Security Act of 2020 (the CARES Act) as well as other relief under COBRA and other federal tax laws.
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Merging a group health plan sponsored by an affiliated business unit into the client's U.S. group health plan.
- Advised a statewide public pension fund on the application of proposed regulations regarding Medicare rebates as well as new “excepted benefit health reimbursement arrangements” to their health program. Calfee drafted comment letters to the applicable agencies on the client's behalf as a response to these proposed regulations. Calfee also advised the client with drafting a new health reimbursement arrangement in light of the new regulations authorizing such arrangements. In 2019, Calfee advised the client on amending its services agreements with its pharmacy benefit manager (PBM) as well as its third-party administrator for its Medicare Part D program.
- Represented a privately held majority-owned ESOP company and its parent in a $510-million sale of the equity of the client to a major public company in the same industry. The Employee Benefits and Executive Compensation team counseled the client with respect to a pass-through vote on the sale by ESOP participants, and we also provided counsel with respect to the termination of the company’s retiree welfare programs, foreign subsidiaries’ employee ownership arrangements, and other executive and deferred compensation arrangements. We continue to represent the client with respect to the termination of an ESOP plan, as well as other post-closing benefit aspects of the transaction, including related purchase price adjustments.
- Broad representation for a manufacturer of coatings and sealants as to employee benefit matters and executive compensation matters:
- In a recent notable project, Calfee advised on changing trustees for two defined contribution plans, which involved amending the plan document to match the trustee's and recordkeeper's administrative practices, negotiating the services agreement with the recordkeeper and trust agreement with the trustee, and assisting with administrative issues such as providing blackout notices to participants and complying with insider trading requirements under the Sarbanes-Oxley Act.
- Calfee regularly advises the client with respect to executive compensation matters, including drafting employment agreements for key executives.
- Advised the client on various matters related to executive compensation and employee benefits matters arising under the COVID-19 pandemic, including questions related to deferring bonuses and implementing new forms of equity awards.
- Advised on amending its nonqualified deferred compensation plan to add a new set of deferrals for executives in one of its operating subsidiaries.
- Advised the client with respect to filing a new registration statement for its 401(k) plan under Form S-8 with the Securities Exchange Commission.
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Provide ongoing advice to one of the nation's premier retirement systems regarding benefit plan matters, including concerning the pension and healthcare arrangements it maintains for retired school and university teachers of its state. Recent notable projects included providing guidance or other assistance regarding:
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Drafting and negotiating a multi-billion-dollar services arrangement with a new pharmacy benefit manager for prescription drugs under the client's retiree health plan.
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Changes to their retirement plans required or permitted under the Setting Every Community Up for Retirement Enhancement Act of 2019 (the SECURE Act) and the Coronavirus Aid, Relief, & Economic Security Act of 2020 (the CARES Act).
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Analyzing the client’s ability to move funds from a 401(h) account for retiree health benefits back to the retirement plan.
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Various IRS rules impacting the timing of after-tax contributions to purchase permissive service credits under its pension plans.
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- Advised a wealth management firm client on matters related to its services as an investment manager to retirement plans, including services as a so-called 3(21) investment adviser and a 3(38) investment manager under ERISA. Advised the client on amending its investment management agreement for its clients receiving 3(38) investment management services through a partnership with another investment adviser.
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Represent Calfee as the legal partner of an advisory firm as it forms Pooled Employer Plans (PEPs) for its clients. PEPs are multiple-employer defined contribution plans created under the Setting Every Community Up for Retirement Enhancement Act of 2019 (the SECURE Act) and will become effective starting January 1, 2021. Members of the Employee Benefits and Executive Compensation practice group will be responsible for providing legal due diligence review of 401(k) plans that are being merged into the respective PEPs.
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