The company that owns Market Basket, Demoulas Super Markets Inc., has agreed to pay $17.5 million to settle a class-action claim that it mismanaged its retirement plan system for its employees.
The company has also agreed to change the way it manages its retirement plan. From now on, the plan will not hold more than 10% of funds in cash, and the fund will raise its annual return estimate by 1%.
Paul Toomey, an ex-Market Basket employee, raised the class-action lawsuit last year, arguing that the chain employed a “wildly unsuccessful” investment system. The company’s goal was to put 70% of the plan’s assets in fixed-income accounts and did not distinguish between the age of employees.