W.W. Grainger 401(k) Plan Forfeiture Challenge Advances in Part

W.W. Grainger Inc. may have violated federal benefits law and the terms of its retirement plan by using forfeited 401(k) money to make its contributions to the plan, a federal judge ruled.

Grainger’s 401(k) plan document requires the industrial supplier to use forfeitures to pay administrative expenses before putting them toward its employer contributions to the plan, Mary M. Rowland said Monday for the US District Court for the Northern District of Illinois. This mandatory language distinguishes the case from several recent 401(k) forfeiture challenges that have been dismissed because the plan document gave the employer discretion over how to ...