Deere & Co. a/k/a John Deere has filed a motion to dismiss former employees’ claims that the Employee Retirement Income Security Act (ERISA) governs its severance program. In an Illinois federal court lawsuit over its 2024 layoffs, the agricultural equipment company argued that a single lump-sum payment to laid-off workers requires no ongoing administration. Because the severance payment involved a single check based on simple math, John Deere has taken the position that its severance program does not qualify as an ERISA plan.
Former John Deere employees Tauseef Ahmed and Anthony Catalfano filed suit after separating from the company. Ahmed was terminated in 2025, and Catalfano voluntarily resigned in 2026 instead of signing a performance improvement plan. They argue that they should have been able to receive payment from the company’s severance program after their respective separations since it is an ERISA-governed plan. The company had previously offered workers laid off in 2024 a separation agreement under which they would receive a one-time lump-sum severance payment based on years of service and base pay at the time of the layoff.
John Deere argued that the U.S. Supreme Court’s 1987 decision in Fort Halifax Packing Co. v. Coyne compelled the court to dismiss the former employees’ claims that ERISA applied to the severance program. In Fort Halifax, the Supreme Court held that a severance program involving a one-time lump sum payment resulting from a single event required no administrative scheme. Therefore, the Supreme Court concluded, the program was not an employee benefit plan subject to ERISA.
Based on the characteristics of the severance program in Halifax, John Deere claimed that its program also required no ongoing administrative work or monitoring, since it involved only a one-time calculation with fixed inputs.
John Deere also argued that even if the program was subject to ERISA, the two plaintiffs failed to prove that they were participants eligible for the program. Ahmed claims the company illegally terminated him due to discrimination based on national origin, religion, race, and age, not because of an organization-wide layoff. As a result, John Deere maintains that Ahmed was ineligible for the severance program. Similarly, Catalfano voluntarily resigned, thus rendering him also ineligible for the severance program. Additionally, Catalfano signed a separation agreement in which he generally waived all claims, including ERISA claims, in exchange for three months of base pay. Since he failed to return his severance payment, John Deere claims that he could not challenge that waiver agreement.
The case is Ahmed et al. v. Deere & Company et al., Case Number 4:26-CV-04114, U.S. District Court for the Central District of Illinois.
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