Total Plan Assets: $590 million
Participants: 4,695
Participation Rate: 92%
Average Deferral Rate: 6.8%
Default Deferral Rate: 6%
Default Investment: Schwab Managed Retirement Trust Funds
Automatic Enrollment:
Yes
Automatic Escalation:
Yes
Employer Contribution: 100% on 4% + 50% on 5%-6% (up to $4,000)

Forty percent of participants in Marvell Semiconductor’s 401(k) plan contribute to the maximum Internal Revenue Service limits. Having a highly educated and well-paid workforce helps. “We are a tech company, so we have mostly employees with bachelor’s and master’s degrees, if not Ph.D.s,” Senior Benefits Analyst Heather Scott says of the Santa Clara, California-based company.

But the company also has a lot of employees, many of them engineers, who’ve moved to the United States from other countries that rely on government-run pension systems. Many weren’t familiar with defined contribution-style plans before joining Marvell. “Primarily we have folks coming from China, Israel, and India. All of those countries have statutory (public) pension plans,” she explains. “So that’s a challenge. Before, it didn’t seem like they were engaged. Probably they were just not well-informed about what a 401(k) plan is.”

A focused education effort over the past three years has helped increase those employees’ awareness of the plan. Marvell works with its recordkeeper, Charles Schwab, to conduct  targeted education based on plan analytics about under-savers. “If folks are not maximizing the match, we have communication that goes out to them and explains, ‘Here’s the match money that you’re leaving on the table,’” Scott says. “We also look at the analytics on who is not contributing at all, and send those participants targeted communication to explain how studies show that if you start contributing earlier in your career, you’ll have a much larger account balance later in life.”

Marvell also has fun with 401(k) education. It promotes the 401(k) plan during the company’s annual staff pingpong tournament, which lasts for three weeks and generates intense interest among employees. That effort started in 2017 with a focus on Schwab’s interactive “My Retirement” retirement-readiness tool, which Marvell promoted by distributing co-branded wristbands and headbands (meant to be worn in the style of former tennis pro John McEnroe) with the T-shirt that tournament participants received. “We had a big uptick of people who went in and used the My Retirement tool, and took action,” Scott says. Ten percent of employees who opened the tool during that time took an action, such as increasing their deferral.

In 2018, Marvell promoted the Schwab advice service that’s free for plan participants, by distributing co-branded golf towels to tournament players and offering one-on-one meetings to employees. “During the tournament, there is a big Schwab team onsite, and employees can sit at café tables and talk to Schwab,” Scott says. Many employees sought help last year on rolling their balance from a previous employer’s plan into the Marvell plan, she adds.

The company also has motivated employees by doubling its maximum 401(k) contribution, from $2,000 to $4,000, says Margaret Shaw, senior director, global benefits. The employer now matches 100% of 4% and 50% of the next 2% to the $4,000 maximum. “After the match formula changed, we started to see employees contributing more, to achieve the full match,” she says. “But more than that: With education offerings around the new match, our employees learned how 401(k) plans work, and are engaging more with the features and tools available.”—Judy Ward

 

 

E_NOTICE Error in file single-awards.php at line 22: Undefined variable: pid