IBM management has proven to be Scrooge once again. Right before the holidays, human resources emailed IBM employees to tell them that its 401(k) plan would be shifting its semi-monthly matching contribution to once a year.
That means that any employee that leaves the company before the Dec. 15 cut-off date will lose the entire match for the year. And this move also robs employees of potential interest and investment growth.
Alliance@IBM — a nationwide union organizing campaign and membership organization for current employees, former employees and retirees — is petitioning IBM to reverse this decision.
"This decision negatively affects tens of thousands of U.S. IBM employees and their families," says the petition. "IBM is, once again, reneging on their respect for their U.S. employees, their families and the communities in which they live. This decision is worse than the Pension decision of 1999, because the 401(k) plan was supposed to supplement the IBM Pension Plan, then. Today, the IBM 401(k) plan is crucial to each employee's future retirement and IBM need not tamper with the original agreement with their U.S. employees. Reverse the decision now."
And if you're active IBM employee, click here to join Alliance@IBM/CWA Local 1701.
The danger is that other companies will be looking at this money-saving effort and follow suit. IBM's 401(k) plan is the largest private sector defined contribution plan in the country, with $37.6 billion in assets, according to Reuters.
"A national trend toward annual matches would be bad news for workers, especially middle- and lower-income households already finding it very difficult to build significant nest eggs through the 401(k) system," wrote Reuters columnist Mark Miller.