Minnesota Check Printers Settle Labor Department Lawsuit Involving Life Insurance Premiums

Archived News Release — Caution: Information may be out of date.

The U. S. Department of Labor has obtained a settlement in which Deluxe Corp. and its subsidiary Deluxe Printers, Inc., based in St. Paul, Minn., have agreed to give employees a premium reduction on life insurance payments owed for eligible participants and dependents.

Under the consent order and judgment, the companies will pay $163,098 to defray the cost of premiums for eligible supplemental life insurance participants over the period Jan. 1, 1998 to Dec. 1, 1998. Eligible dependent life participants will receive a premium reduction of $131,132 during the same period.

Deluxe provides $10,000 of group life insurance at no cost to employees. Employees may elect to purchase at their expense additional coverage for themselves (known as supplemental life insurance) or life insurance on dependents (known as dependent life insurance). As of Jan. 1, 1994, there were 10,994 participants in the group life plan, 5,803 in the dependent life plan, and 8,528 in the salary continuation plan

Deluxe Corporation is the parent of Deluxe Check Printers, which operates more than 60 check printing facilities throughout the U. S. Although Deluxe Corporation began as a check printing business, the corporation also provides a variety of payment system products such as deposit tickets, electronic transfer processing and related software, and automated clearinghouse processing.

The Labor Department filed a lawsuit on April 1 alleging that the companies improperly credited their corporate general accounts all dividends received from Minnesota Mutual Life on the group life and dependent life insurance plans. The dividends were based on favorable claims experience under the insurance policies paid for by the contributions of participants.

The consent order and judgment was entered on April 7 in federal district court in Minneapolis. This case resulted from an investigation conducted by the Kansas Regional Office of the Labor Department’s Pension and Welfare Benefits Administration into alleged violations of the Employee Retirement Income Security Act.

(Herman v. Deluxe Corp.)
Civil Action No. 98-CV-1061JRT/RLE

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Archived News Release — Caution: Information may be out of date.

Contact Name:GLORIA DELLA
Phone Number: 202.219.8921