Employee benefits class actions in October 2026 are lawsuits by workers over 401(k), 403(b), and pension plan management. They seek repayment or added benefits when fiduciaries, the people legally required to act for participants, misuse fees, forfeitures, or pension formulas. Filings surged in 2026 on new theories over forfeited employer contributions, tobacco surcharges, and actuarial assumptions, according to Bloomberg Law reporting. Only one early-2026 filing focused mainly on traditional 401(k) recordkeeping fees.
Table of Contents
- What did the Supreme Court change for prohibited-transaction suits?
- How is the Labor Department handling fiduciary cases now?
- What new theories are driving 2026 filings?
- How did courts rule on forfeiture and surcharge cases in July?
- Could you be included, and what should you do?
What did the Supreme Court change for prohibited-transaction suits?
The U.S. Supreme Court unanimously held on April 17, 2025 in Cunningham v. Cornell, No. 23-1007, that workers state a prohibited-transaction claim by plausibly alleging the plan paid a party in interest.
According to the Faegre Drinker analysis, exemptions are then the defendants' affirmative defense, as described in the Faegre Drinker analysis of the April 17 ruling. A prohibited transaction here means a deal between the plan and a party in interest, such as a service provider. An exemption is a legal excuse that can allow an otherwise barred deal. The practical result is narrower than a win on the merits. Workers can get into court with a clear payment allegation, but the plan can still prevail by proving an exemption applies.
How is the Labor Department handling fiduciary cases now?
The Labor Department's EBSA issued Field Assistance Bulletin 2026-01 on April 14, 2026 to focus enforcement on bad-faith benefit denials, asset misappropriation, and self-enrichment. According to the Labor Department announcement, investigators will generally avoid second-guessing fiduciaries who follow a prudent process, as explained in the Labor Department announcement of the enforcement bulletin. The Department also published a final vacatur on March 20, 2026 that removed the 2024 Retirement Security Rule and restored the 1975 five-part test, according to Snell and Wilmer reporting.
That test decides when investment advice creates fiduciary status, and no new rulemaking is planned. For workers, process now matters more in federal review. A careful, documented decision is less likely to draw enforcement than outright denial, theft, or self-dealing.
What new theories are driving 2026 filings?
The main 2026 theories challenge forfeited employer contributions, wellness-program tobacco surcharges, and pension actuarial assumptions, according to Bloomberg Law reporting. Forfeiture suits allege plans used unvested employer money to cut employer costs rather than help participants. Tobacco-surcharge suits allege wellness penalties unlawfully raised health-plan costs for some workers. A leading pension example involves AT&T, which agreed to a proposed $184.1 million settlement filed July 9, 2026 in N.D.
California. According to the Reuters report, the case covered about 300,000 married participants who alleged outdated mortality tables reduced joint-and-survivor pensions, with $149.1 million in added benefits plus up to $35 million in fees, as detailed in the Reuters report on the proposed settlement. The AT&T deal remains only a proposal until the court approves it. It shows how actuarial inputs, not just fees, can affect monthly checks.
How did courts rule on forfeiture and surcharge cases in July?
Courts split in July 2026. One court let a tobacco-surcharge wellness claim proceed against O'Reilly while granting dismissal in a 401(k) forfeiture suit against Elevance. Trader Joe's also defeated claims over $37 million in forfeitures applied to employer contributions, according to the Mondaq summary from Carlton Fields, as summarized in the Mondaq summary of the July rulings from Carlton Fields.
The split turns on plan terms and use of the money. A wellness penalty tied to health-plan eligibility faces different rules than unvested 401(k) money described in plan documents. Workers should not read one dismissal as the end of all forfeiture suits. Each plan's language and each use of forfeited funds can produce a different result.
Could you be included, and what should you do?
The typical class includes current and former participants in the affected 401(k), 403(b), or defined-benefit plan, according to PLANADVISER reporting from July 2026. Eligibility and payouts still require preliminary and final court approval.
Members must wait for the court-approved notice and file by its deadline. A notice will name the covered plans, dates, and payment method. If you changed addresses after leaving the job, update your contact information with the former plan administrator.
- Keep plan statements, benefit letters, and employment dates for the years named in the notice
- Watch mail and email from the plan administrator for a court-approved notice, not a sales letter
- Submit the claim form and documents by the notice deadline and keep a copy