Debbie Hill
Vice President, Human Resources
  • Plan(s)
    401(k), frozen DB
  • Total Plan Assets
    $121MM
  • Participants
    1,230
  • Participation Rate
    97.8% overall
  • Average Deferral Rate
    8.1% overall
  • Default Deferral Rate
    4.5%
  • Default Investment
    T. Rowe Price target-date funds
  • Automatic Enrollment
  • Automatic Escalation
  • Employer Contribution
    100% of 4.5%, for salaried workers; 60% of 4% for hourly workers; + discretionary contributions
  • Provider(s)
    Recordkeeper, T. Rowe Price; Adviser, Arnerich-Massena, Inc.
  • Financial Wellness Educator(s)
    T. Rowe Price


By defaulting participants’ assets into age-appropriate target-date investments, T. Rowe Price has reduced holdings in the stable value fund the company had been offering from 30% to less than 10%.

Tree Top Inc., headquartered in Selah, Washington, is a grower-owned fruit-processing cooperative, its member orchards in Washington and several other Western states. It produces branded consumer package goods such as fruit juices and apple sauce and ingredient products for many of the major food manufacturers.

Two-thirds of the company’s workers are manufacturing employees—machine operators, mechanics, drivers—who work 10 to 11 months of the year, according to the harvests, prompting the company to largely utilize automatic 401(k) features. Because most employees are passive about making retirement planning decisions, Tree Top has implemented automatic enrollment, starting at 3%, with automatic escalation annually, up to 10%, and automatic re-enrollment. “From an automatic-feature perspective, we try to set them up for the best case for success,” says Scott Washburn, vice president of human resources (HR).

The company’s efforts have worked, enabling Tree Top to achieve a 97.8% participation rate and an 8.1% deferral rate.

Aside from auto-features, Tree Top works with its recordkeeper, T. Rowe Price, on supplying tailored education for every worker. “We avoid the big companywide email blasts where everyone gets the same letter, because everyone is different,” Washburn says. Communication strategies are developed to target group segments—e.g., workers approaching retirement or workers in undiversified funds.

With a large base of Spanish-speaking workers, Tree Top conducts on-site bilingual education with T. Rowe Price, every other year, during company hours at all locations. “It’s a challenge, but we make the time and financial investment to do that because it’s important,” Washburn says. If workers want more information after a meeting, they can schedule a one-on-one with the provider, as well.

Tree Top hasn’t always worked with this recordkeeper. “[T. Rowe Price] really brought a lot of the changes that we made in the last several years, in a really structured and intentional process,” Washburn says. For instance, when the company moved to that provider in 2014, 30% of participants’ assets were invested in stable value funds. Defaulting participants’ assets into age-appropriate target-date investments at the changeover reduced the stable value fund holdings to less than 10%.

The plan sponsor also recently adjusted Tree Top’s loan program, to reduce plan leakage. Participants now must wait 30 days between paying off a loan and taking a new one.

While the company contributes 100% of the first 4.5% deferred in the salaried workers plan and 60% of the first 4% in the hourly workers plan, hourly workers are matched an added “cents per hour” rate based on how many hours they worked—an average of 88 cents per hour. Further, when the company froze its defined benefit (DB) pension plan in 2008, an extra “cents per hour” contribution was added to the 401(k). Tree Top is also adding an after-tax capability in the 401(k)—for both salaried and hourly workers—and in-plan Roth rollovers. Even if some participants decide to waive the benefit, Washburn takes comfort in knowing employees can change their minds. “We want to help guide them, as well,” he says.  

Planning ahead, Tree Top is considering adding technology as a means to communicate about retirement more effectively. This means targeted emails and communication initiatives, ensuring that both types of workers are educated about retirement. “Different things work for different people,” Washburn concludes. “We try to be very targeted in our communications.”

—Amanda Umpierrez

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