Beginning January 1, 2007, the company will enhance both its 401(k) plan and its deferred compensation plan, offering new company retirement contributions, an increase in company matching contributions and greater flexibility for employee contributions, G&K said in a press release. The enhanced plans will also allow additional transition contributions for employees closer to retirement age and with greater years of service.
The company will freeze its defined benefit pension plan and its supplemental DB executive retirement plan as of December 31, 2006, the release said.
The changes will affect approximately 6,300 401(k)-eligible employees and will not affect current company retirees, former employees with vested pension benefits or employees who retire prior to December 31, 2006.
The company joins a growing list of others that are freezing DB plans and enhancing DC offerings in order to gain more control on retirement plan costs (See GM Unveils Finalized Pension Restructuring and Two More Companies Join DB Plan Freezing List ).