IBM Retires Retirement Plan
Saturday January 7, 2006
Effective 2008, IBM is retiring its traditional retirement plan; approximately 120,000 US employees will participate in the company's 401(k) plan. For the period 2006-2010, the company "expects to cut costs by $2.5 billion to $3 billion." IBM made the public announcement prior to notifying employees, according to the Communication Workers of America. IBM is joining a trend -- research and news reports suggest that 9-20 percent of US companies are freezing or terminating traditional pension plans and replacing them with 401(k) plans. In December, the House "took up pension overhaul legislation with agreement that the current employer-based pension system is in deep trouble but disagreement over what should be done to fix it."
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