Colgate-Palmolive is paying $332 million to settle a federal class action brought by retirees who say the company didn’t calculate their pension lump-sum payments correctly. A federal judge in New York granted preliminary approval to the settlement, clearing the way for eligible retirees to receive their share.
The settlement is one of the largest pension-related class action settlements in recent years, and it covers former Colgate employees who chose to receive their retirement benefits as a single lump-sum payment rather than monthly checks for the rest of their lives.
What the Lawsuit Says Went Wrong
When a worker retires with a pension, they often have a choice: take a monthly payment for life, or take the whole amount as a single lump sum up front. Converting a future stream of monthly payments into a lump sum today requires a calculation — and the retirees in this case say Colgate got that calculation wrong.
Specifically, the lawsuit says Colgate used a formula that did not comply with federal retirement law (ERISA). The retirees claim the formula Colgate used resulted in lump-sum payments that were smaller than what they were actually owed under the law. Over a full retirement, that difference can add up to tens of thousands of dollars per person.
Errors like this can be hard to spot. When a company sends you a lump-sum figure, there’s usually no explanation of how the number was calculated — which means many retirees never know they received less than they were owed.
What Happens Next
Preliminary approval means a judge has reviewed the settlement and found it reasonable enough to move forward. The next step is a formal notice to class members (former Colgate employees who qualify), followed by a final approval hearing where the judge decides whether to make the settlement official.
Once final approval is granted, retirees who are eligible will generally need to submit a claim to receive their payment. The settlement fund — $332 million — has already been set aside. How much each individual receives depends on how many people file claims and what the calculation formula shows they were owed.
Who May Qualify
You may be part of this settlement if:
- You were a former Colgate-Palmolive employee with a pension benefit
- You elected to receive your pension as a lump-sum payment rather than monthly checks
- You retired in recent years and took the single payout option
If you’re unsure whether you received the correct amount, submitting your information now ensures you’re notified if you’re included in the class.
Once a claim deadline is set, missing it can mean forfeiting your share of the settlement. Submit your information now so you don’t miss your window. It’s free to check.
Sources
- Expert Institute. “Biggest Class Action Settlements of 2026.” 2026.
- Top Class Actions. “May 2026 Settlements Roundup.” May 2026.