Profit-Hungry Companies Take Ax to 401(k) Matches Pensions & Investments (12/01) Vol. 29, No. 25 p.3; Jacobius, Arleen
Several companies are eliminating or slashing their 401(k) employer match in an effort to save money. General Motors, for example, is cutting its company contribution to 60 cents from 80 cents for each dollar an employee contributes up to 6 percent of pay for participants, while DaimlerChrysler intends to suspend its matching contribution come Jan. 1, 2002. Several other firms are restructuring their matching contributions to make them more discretionary, and others are adding profit sharing on top of fixed company matches. New Jersey's Panasonic, for instance, has restructured the match in its 401(k) plan to include a 2 percent fixed contribution on the first 5 percent of pay and a 3 percent annual discretionary contribution by the company. Meanwhile, Visteon's suspension of its company match program is expected to save $25 million in 2002, according to officials.