In a memo to employees, GateHouse Media said it had determined to discontinue the discretionary employer matching contribution under the 401(k) plan effective, January 1, 2009. The memo, from GateHouse Media CEO Michael Reed, said that the firm would revisit the issue and “…hopes to be able to provide this discretionary benefit under the 401(k) Plan at some time in the future.” The plan remains available for employee contributions.
GateHouse Media, Inc., headquartered in Fairport, New York, describes itself as one of the largest publishers of locally based print and online media in the United States as measured by its 97 daily publications. GateHouse Media currently serves local audiences of more than 10 million per week across 21 states through hundreds of community publications and local websites.
A list of GateHouse Media publications is online at http://www.gatehousemedia.com/publications/
The firm is the latest of several to suspend their 2009 matching contributions as 2008 wound to a close, including Sears (see Sears Suspends 401(k) Match in Face of Declining Sales ), the Denver Post ( Denver Post Latest to Suspend 401(k) Match ), Unisys ( Unisys Cuts 401(k) Match, Slices 1,300 Jobs ), Starbucks (see Starbucks to Exercise Discretion in 401(k) Matching ), Motorola (see Motorola Freezes DB Plan; Suspends 401(k) Match ), and FedEx (see FedEx Suspends Match, Cuts Pay ).
However most plan sponsors responding to a recent PLANSPONSOR survey said they had no plans to change their 401(k) match program (See SURVEY SAYS: What Are Your Plans for Your Match? ) – a sentiment echoed in a recent employer survey by Mercer (see 83% of Employers Surveyed do not Expect Employer Contribution Changes ). And Dollar Thrifty Automotive Group, Inc. recently reinstated its match after a suspension (see Dollar Says Reinstating Match is the “Right Thing to Do” ).
A memo sent to all employees on December 31 from CEO Michael Reed last week reads as follows (according to The Romenesko site at www.poynter.org ):
Our nation is experiencing difficult economic times and 2008 was a very challenging year in terms of revenues for all media companies. While GateHouse performed better than most, we were not immune to the economic slowdown. In response to these pressures, GateHouse continues to look at all the options it has to help control costs and remain a competitive company in the event that the current slowdown worsens or lasts longer than expected.
The terms of the Company's 401(k) retirement savings plan allow for a discretionary employer matching contribution. In the past, this has allowed the Company to provide a meaningful employer matching contribution to employees who have contributed money from their paychecks to the Company's 401(k) retirement plan. The Company has determined to discontinue the discretionary employer matching contribution under the 401(k) plan effective January 1, 2009. The Company will revisit this issue and hopes to be able to provide this discretionary benefit under the 401(k) Plan at some time in the future. The plan will still remain available for employee contributions.
We look forward to working through a challenging 2009 and to coming out of this economic downturn a strong and viable company. We sincerely appreciate your efforts and contributions throughout 2008.