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Matching 401 k Contributions
Benefits & Compensation
Matching 401 k Contributions
Exchange ideas about health plans, retirement, work/life benefits, and employee assistance.
Is anyone considering reducing or eliminating their company match to 401k as a result of an expense reduction initiative? If so, are there plans to possibley reinstate later in the year, assuming your
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Forums » Topic Forums » Benefits & Compensation » Matching 401 k Contributions
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Matching 401 k Contributions
posted at 11/14/2008 8:58 AM EST
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Posts: 2
First: 11/14/2008 Last: 11/14/2008 |
Is anyone considering reducing or eliminating their company match to 401k as a result of an expense reduction initiative? If so, are there plans to possibley reinstate later in the year, assuming your plan allows this type of activity.
Thanks |
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Matching 401 k Contributions
posted at 11/14/2008 9:08 AM EST
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Posts: 2146
First: 2/15/2006 Last: 9/14/2011 |
We are suspending our 401k match for 2009 and will look into it again for 2010. It was 50% of the first 6% (i.e. max 3%).
It was one of the easiest ways to lower costs. I was charged with lowering payroll+benefits by 25%. It was not easy, but it was either suspending match or losing another employee. We are going to continue allowing deferrals rather than freezing or terminating the plan because there are still some who want to defer. If it ever gets to a point where participation is very very low, then we will discuss freezing and/or terminating. |
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Matching 401 k Contributions
posted at 11/14/2008 9:22 AM EST
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Posts: 2
First: 11/14/2008 Last: 11/14/2008 |
Thank you for the quick response. I guess I should be happy I was asked to keep things flat with this year in terms of benefits. Our match is 6% (dollar for dollar) on the first 6%. I'm sure we will probably reduce it if not eliminate it all together. |
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Matching 401 k Contributions
posted at 12/9/2008 5:14 AM EST
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Posts: 8
First: 3/14/2006 Last: 12/9/2008 |
We are suspending our match for 2009 with no set timeframe for reinstating it. We are currently matching dollar for dollar for the 1st 5% of base salary. When the match returns, it probably will not be so generous. |
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Matching 401 k Contributions
posted at 12/9/2008 6:53 AM EST
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Posts: 1
First: 12/9/2008 Last: 12/9/2008 |
We have a safe harbor match ($1 for $1 on the first 3% deferred; $.50 on the $1 for then next 2% deferred) and elected to keep the match in place notwithstanding the cost. The decision wasn't without a certain amount of hand-wringing (annual company cost > $2M), but felt we needed to retain talent. Besides, if operating results deteriorate too far below our forecasts, we can still elect to reduce or suspend the match at any point in the year after giving proper notice. Hopefully, that won't become necessary, but the environment is particularly challenging for retailers these days. |
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Matching 401 k Contributions
posted at 12/10/2008 8:31 AM EST
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Posts: 1
First: 12/10/2008 Last: 12/10/2008 |
We just announced this morning that we are suspending our match (100% on 6%) for at least the first 6 mos of 2009. We are an automotive oem, so if the big 3 don't get a bailout soon, we will be a world of hurt. |
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Matching 401 k Contributions
posted at 12/11/2008 5:44 AM EST
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Posts: 1
First: 12/11/2008 Last: 12/11/2008 |
We are not suspending our match and in fact, are implementing safe harbor on 1/1/09.
In addition, many of my clients are holding firm on the match yet within the last 6 months, only one of my clients have had a lay-off. |
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Matching 401 k Contributions
posted at 12/11/2008 5:46 AM EST
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Posts: 39
First: 9/15/2004 Last: 10/7/2010 |
We also have a 3% safe harbor - in addition to a dollar4dollar match up to 5% max. Our plan yr. renewed in July and we cut the mach to max of 2.5%. We also stretched the waiting period for new hires to 6 months. Believe it or not,it had always been only ONE month - which was terribly time consuming and costly because we have many employees don't even complete 6mths of employment.
We also designated only 2 entry dates per year, rather than allowing enrollments at anytime, so after 6mths, new hires must also wait for the next entry date before entering the plan. |
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