Corporate 401(k) >$1B

Delta Air Lines, Inc.






Delta Airlines, headquartered in Atlanta, boasts a 401(k) plan with innovative features related to automatic enrollment, participant communications and financial wellness, but the plan also stands out for its generosity.

Under the plan’s 2017 formula, employees who contribute 6% receive a 9% contribution from Delta, for a total of 15% of annual compensation going to their account, says Kay Allison, retirement manager. Considering that the average employee-only deferral stands at 8.5%, and that employees may contribute up to 100% of their annual profit-sharing payment, it all indicates the plan is successfully generating significant savings among its participants.

The plan’s outside attorney, J. Timothy McDonald, with Thompson Hine LLP, suggests that Delta is not just throwing money at the retirement problem “but is truly trying to work on financial wellness at the same time.” For example, Delta has partnered with SunTrust Bank to offer a financial wellness program, being rolled out this year. Investment advice is also available for participants through Financial Engines, with much of the advisory fee being paid by Delta.

“This component of financial wellness and the targeted delivery is critically important because the majority of Delta employees perform their jobs in nontraditional locations such as airports, airplanes and hangars and not in a regular office setting,” Allison observes. “In 2016, we introduced a virtual online benefits counselor called ALEX, which is a Jellyvision product customized with Delta’s plan details, to educate employees about 401(k) plan benefits. Employees can interact with ALEX to learn about complex benefit topics in a fun way, and the tool is expected to help further boost participation.”

Important to note, the retirement package has not exactly been easy to manage, as Delta’s business environment is growing increasingly complex. As Allison observes, one recent hurdle arose when Delta merged with Northwest Airlines, after both companies emerged from bankruptcy in 2007.

“We changed our fund lineup and merged several 401(k) plans in the same year, 2010, which was a huge effort,” Allison says. “Our partnership with Fidelity on both projects helped to build a strong working relationship between our companies.”

McDonald says there are “many ways I could talk about how great of a job Delta does with its plan,” but, he says, the best way is to observe that “Delta does not call, asking me to help them come up with excuses for why they can’t implement an innovative plan design feature. Instead, they call me and say, ‘This is what we want to do, and we want to make sure it’s done in a compliant way. Can you help us make that happen?’ It’s a full commitment to plan quality.” He especially complements the work of Delta’s assistant general counsel, Debbie Brown.

Others cited for their commitment to the Delta plan include Greg Tahvonen, vice president of total rewards, information technology (IT) and human resources (HR); Kate Millard, general manager, retirement and international benefits; and Gwyneth Leggett, manager, retirement plans. —John Manganaro

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