The Atlanta-based consumer credit-reporting agency said Equifax will freeze its pension plan for U.S. employees on January 1, 2009 who do not meet certain grandfathering criteria for retirement eligible employees.
Equifax will provide these employees and certain other workers not eligible to participate in the Plan with the enhanced 401(k), the company said in a news release.
The pension plan amendments will freeze service credit, but will continue to credit for the participant’s salary increases over time, Equifax said. Grandfathered employees will remain in the current pension and 401(k) plans.
Under the enhanced 401(k) plan, Equifax will make an automatic contribution of between 1.5% and 4% of pay based on years of service, even if employees do not choose to make a 401(k) plan contribution and will provide a 100% match on employees’ 401(k) contributions up to 4% of pay (compared to a 50% match on the first 6% of employees’ contributions in the current plan).
Combining the maximum employee-provided and company-provided contributions, eligible employees can have as much as 8% percent of pay for their enhanced 401(k) plan investment choices, the company said
The changes do not affect Equifax's current U.S. retirees, former employees with vested benefits or employees who are eligible to retire prior to January 1, 2009.
"We have taken great care to develop a retirement program that we believe is in the best interests of our employees and the company," said Equifax Chairman and Chief Executive Officer Richard F. Smith, in a statement. "These changes will give us benefits that remain very competitive, align with our meritocracy culture, and provide more predictable retirement plan costs."
The company will continue to recognize pension expense and cash funding obligations over the remaining life of the liability for employees who continue to earn benefits under the pension plan and for the frozen benefits under the pension plan.
Equifax Inc. employs approximately 7,000 people in 15 countries throughout North America, Latin America, and Europe.