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Appeals court says employer can't question divorces

In what some are calling a victory for privacy rights, an appeals court recently upheld a decision that an employer cannot look into whether an employee's divorce was obtained for proper purposes.

The Fifth Circuit Court of Appeals agreed with a lower court that Continental Airlines had no right to look into the reasons some of its pilots had for seeking to divorce their spouses. In 2009, Continental sued nine of its pilots - seven men and two women - after it accused them of obtaining "sham divorces." Under federal law, the divorces enabled the pilots' spouses to get access to their lump-sum pensions even while the employee was still working for the airline. The pilots then allegedly remarried the same spouses. In Continental's view, the whole thing was a calculated strategy to get the spouses access to pension funds before the employees retired.

The pilots are now suing Continental for wrongful termination and interference with pension rights. An attorney for five of the pilots called the decision a victory for privacy rights because it curtails an employer's right to investigate the marital situation of employees.

If Continental's claim of what happened here is accurate, it seems that the pilots involved never actually wanted to get divorced. Nonetheless, this situation does bring to mind the fact that determining what a soon-to-be-ex spouse is entitled to in terms of pensions and retirement benefits can be complex. Financial professionals may help with the numbers aspect of things, but it may also a good idea to speak with a family law attorney. He or she will be familiar with your state's laws and can advise you as to what impact those laws have on your personal, specific situation.

Source: ABC News, "Pilots Win 'Sham-Divorce' Case Against Continental," David Koenig, 20 July 2011.

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