Business Notes

The strategy was crafty but cruel. When Continental Can was trying to cut costs in its plants during the late 1970s, the company employed a secret computer program called BELL, a reverse acronym for Let's Limit Employee Benefits. Managers used the program to target and lay off employees just weeks or months before they were vested in the company pension plan. In that way, the company aimed to avoid millions of dollars in pension payments.

It was a costly mistake. The United Steel Workers of America filed a class- action suit in 1982 under the Employee Retirement Income Security Act. Federal courts ruled that the company had acted illegally and ordered Continental to compensate its retired workers. Last week Continental finally reached an agreement under which it will pay $415 million to 3,000 people, the largest settlement in the 17-year history of ERISA.