Kelly Milligan, a former Financial Advisor, sued the firm after his voluntary resignation canceled unvested WealthChoice Awards. He argued the awards constituted deferred income under ERISA, which would trigger federal vesting and anti-forfeiture protections.
The WealthChoice Awards were granted annually to select high-performing Advisors. Payment was conditioned on remaining employed for eight years and meeting performance criteria. The awards were paid as a lump sum shortly after vesting and did not provide retirement income.
The court held that the program was a retention-based bonus tied to continued service. It did not systematically defer compensation until the termination of employment, nor did it provide retirement income.
Because the program fell outside ERISA’s definition of an employee pension benefit plan, it was not subject to federal regulation. The district court’s grant of summary judgment for the employer was affirmed.