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Whole Foods Settles 401(k) Plan Fee ERISA Class Action for $2 Million

Settlement addresses years of alleged overcharging for basic recordkeeping services by plan administrators

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About the Whole Foods 401(k) Settlement

Participants in Whole Foods Market’s “Growing Your Future 401(k) Plan” have reached a settlement with the company and its plan fiduciaries over allegations of excessive fees and violations of the Employee Retirement Income Security Act (ERISA). 

 

Current participants may be eligible to receive automatic payments, while former participants must submit a claim form to possibly receive a portion of the settlement fund.

 

Why Did the 401(k) Participants Sue?

The plaintiffs in this class action lawsuit say that Whole Foods Market Inc. breached its fiduciary duties by allowing plan participants to pay significantly higher fees than necessary.

 

Hidden premium charges

According to the complaint, members in the Growing Your Future 401(k) Plan paid approximately $31 per participant in recordkeeping fees each year between 2017 and 2025.

 

This figure stands in stark contrast to what comparable companies typically charged their employees:

  • Apple: $8-$23 per participant
  • Costco: $8-$23 per participant
  • Google: $8-$23 per participant

 

The plaintiffs argued that Whole Foods should have leveraged its billion-dollar bargaining power and negotiated better rates with Fidelity Investments, the plan's recordkeeper. 

 

Multiple defendants sued

Seven named plaintiffs brought the action on behalf of all plan participants against Whole Foods Market and the following Amazon subsidiaries:

  • The Board of Directors of Whole Foods Market, Inc.
  • The Whole Foods Market, Inc. Employer Committee
  • The Whole Foods Market, Inc. 401(k) Committee
  • The Whole Foods Market, Inc. Benefits Administrative Committee

 

The Fidelity Investments fiduciaries who managed the Growing Your Future 401(k) Plan were sued in separate lawsuits and have since consolidated all claims into this class action settlement.

 

Alleged Ethical Breach and ERISA Violations 

The claims in this class action primarily focus on failures by plan fiduciaries to meet their legal obligations under ERISA.

 

Pension plan mismanagement

According to court documents, Whole Foods failed to conduct a competitive bidding process for record-keeping services through a Request for Proposal (RFP) process. 

 

Plaintiffs say this oversight resulted in the plan continuing to pay above-market administrative fees, despite its substantial size.

 

Breach of ERISA duties

The lawsuit emphasized that fiduciaries have a legal obligation under ERISA to act prudently and solely in the interest of plan participants.

 

Key allegations included:

  • Inadequate monitoring of plan fiduciaries responsible for fee negotiations.
  • Failure to benchmark fees against similar-sized plans..
  • Maintaining relationships without periodic competitive review
  • Allowing Fidelity to charge rates that exceeded its own admitted fair market value of $14-$21 per participant.

 

Who Can File a Claim in the ERISA Class Action?

The settlement administrator has set up a two-tier class member eligibility standard.

 

Current plan participants

Current Growing Your Future 401(k) Plan members with active accounts as of July 24, 2025 are automatically included in the settlement. 

 

These participants don't need to take any action and may receive an automatic share of the settlement, which administrators will deposit directly into their existing 401(k) account after determining eligibility and obtaining final court approval.

 

Eligible payments will appear as a tax-deferred retirement account contribution added to their other investments.

 

Former participants and beneficiaries

Former employees and beneficiaries face different requirements. 

 

Whole Foods 401K members who held an account balance during the class period but no longer maintain an active plan must submit a claim form by November 21, 2025 to participate in this settlement. 

 

This category includes:

  • Former employees who left Whole Foods after November 6, 2017.
  • Beneficiaries of deceased participants.
  • Alternate payees under Qualified Domestic Relations Orders (QDROs).
  • Anyone who withdrew their full account balance before July 24, 2025.

 

Important Restriction: The minimum payment threshold is $10.00, but it doesn't apply to current participants with active accounts.

 

Eligible Class Member Compensation Estimates 

After determining eligibility and making several deductions, administrators will distribute the remaining portion of the $2 million settlement to class members.

 

Individual payment will depend on a court-approved allocation formula considering:

  • Length of time the member participated in the plan during the class period.
  • Average account balance during participation.
  • Total number of valid claims submitted.
  • Whether the member maintained continuous participation or had gaps in coverage.

 

Participants with larger account balances and longer participation periods may receive proportionally larger payments. 

 

How to Submit Whole Foods Employee Retirement Claims

Former participants can file claims through the official settlement website at 401kPlanERISASettlement.com as follows:

  1. Locate your claim number and PIN from the settlement notice.
  2. Visit the settlement website.
  3. Enter your unique identifiers.
  4. Provide your Social Security number for verification.
  5. Select your payment method (check or roll over to another qualified plan).
  6. Submit your claim electronically.

 

The system will confirm successful submission immediately.

 

Mail-In Claim Form Instructions

Former 401(k) participants who prefer traditional mail or are unable to access the online system can download a PDF Claim Form from the settlement website and mail it to: Whole Foods Market ERISA Settlement Administrator, P.O. Box 2010, Chanhassen, MN 55317-2010.

 

Mailed claims must be postmarked by November 21, 2025, and should be sent using certified mail to ensure delivery confirmation.

 

Important Dates for the Retirement Plan Settlement

  • November 6, 2017 - July 24, 2025: Class period.
  • November 21, 2025: Claim submission deadline for former participants
  • December 16, 2025: Deadline to file objections with the court
  • January 15, 2026: Final approval (fairness) hearing at 9:00 a.m.
  • Post-approval: Payment distribution begins after any appeals are resolved

 

Learn More About Eligibility

Former Growing Your Future 401(k) Plan members should act promptly to determine if they are eligible for this ERISA settlement. Current 401(k) plan participants don’t need to take action and may receive an automatic payment..

 

Visit https://401kplanerisasettlement.com for more details about eligibility, settlement terms, and the lawsuit.


Frequently Asked Questions (FAQ)

No, both current and former employees who participated in the Growing Your Future 401(k) Plan between November 6, 2017, and July 24, 2025, are eligible. Current employees receive automatic deposits into their active accounts. Former employees must submit a claim form by November 21, 2025, to qualify for a possible payment via check or a rollover.

ent. The court will consider all objections at the fairness hearing scheduled for January 15, 2026.

The lawsuit revealed that Whole Foods participants paid approximately $31 per participant in recordkeeping fees between 2020 and 2022, while comparable companies, such as Apple, Costco, and Google, charged only $8 to $23. Plaintiffs argued that with over $1 billion in plan assets, Whole Foods should have negotiated better rates with Fidelity Investments.

 

For current participants, payments deposited into active 401(k) accounts maintain tax-deferred status and won't trigger immediate taxes. Former participants can choose to roll over their funds to preserve tax benefits or receive a check, which may be subject to withholding and potential early withdrawal penalties if they are under the age of 59.

 

You cannot opt out of this ERISA class action settlement, but you can file written objections with the court by December 16, 2025. Objections must include your name, proof of class membership, and detailed reasons for disagreement.

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