Opinion ID: 805196
Heading Depth: 4
Heading Rank: 1

Heading: 66% of Final Average Earnings.

Text: Id. at 682. The Carollo court found that the plan violated the change the base regulation by, not only increasing a particiMCCORKLE v. BANK OF AMERICA 21 pant’s benefit base after 25 years, but making that change retroactive for the participant’s entire career. Id. at 683. In both the above examples, the plan provided for a change in the amount upon which benefits were to be calculated—literally the base. See, e.g., id. at 682 (The percentage is considered the ‘rate’; the average monthly pay constitutes the ‘base.’). Although Plaintiffs assert that the NRA should also be considered part of the base for purposes of the change-the-base regulation, they have come forward with no authority, and we can find none, in support of that position. Rather, the weight of authority supports the Bank’s stance that base means just that: the amount of compensation that, when multiplied by the benefit computation formula, becomes the benefit payable under the plan. Furthermore, the Bank persuasively argues that, even indulging in the assumption that NRA is part of the base, the Plan’s NRA does not change within the meaning of the change-the-base regulation. It contends that the NRA changes only if one assumes, improperly, that a Plan participant does not work beyond the current year. Under the theory pressed by Plaintiffs, when an employee joins the Plan, his or her NRA begins as age 65. By that same theory, when an employee has completed five years of service, the employee’s NRA then changes to that employee’s age at that point in time. This interpretation of the Plan, however, wrongly assumes that the participant will reach age 65 before reaching five years of service. See Opening Br. at 19 ([E]very employee starts out with a [NRA] of ‘age 65’ – i.e., the earlier of the two alternative dates in the definition that the employee would reach were he to immediately terminate employment.). The flaw in Plaintiffs’ reasoning is their assumption that the NRA calculation must be made as though the employee was immediately terminating employment the day after he or 22 MCCORKLE v. BANK OF AMERICA she starts. Plaintiffs do not offer any support for that assumption, which the anti-backloading statute itself, 29 U.S.C. § 1054, dispels. The statute plainly provides that all . . . relevant factors used to compute benefits shall be treated as remaining constant as of the current year for all years after [such] current year. § 1054(b)(1)(B)(iv). In other words, a participant’s employment is treated as remaining constant for the year of his initial employment and for all years after the current year. Id. Thus, ERISA would assume the participant’s employment continues until actual termination causes a change and would not indulge an artificial assumption the employee would move on within five years of starting. When employment is viewed as a constant, Plaintiffs’ theory that the NRA changes after five years of service falls apart. Viewing employment as a constant, as 29 U.S.C. § 1054 says we should, an individual who becomes a Plan participant (before age 60) will reach NRA upon five years of vesting service. Because the Plan does not use an NRA that changes after five years of service, neither 26 C.F.R. § 1.411(b)-1(b)(2)(ii)(F) nor Notice 2007-69 are inapplicable. Accordingly, even if Plaintiffs had not conceded Count Three fails to state a claim, Plaintiffs have not carried their burden to show that the Plan impermissibly backloads benefit accrual.