The Sacramento Bee reports that GenCorp’s policy of matching workers’ 401(k) contributions with shares in the company has put downward pressure on the firm’s stock, which has lost 70% of its value in the past year. “It is our hope certainly that the financial markets will improve, that the stock price will improve, but it wasn’t prudent for us to sit and wait and hope for that to happen,” spokeswoman Linda Cutler told the Bee.
Cutler said the moves only affect 2,600 non-union employees at headquarters and other locations. However, GenCorp is asking its 500 union employees, all of whom work in Rancho Cordova, to accept a similar concession “so that all employees will be treated equally,” she added.
GenCorp, the parent of Aerojet, said in a filing with the Securities and Exchange Commission that the retirement plan changes will save about $29 million a year.
Motorola on Wednesday also announced it is both freezing its defined benefit pension plan and suspending its 401(k) plan match in the coming year (See Motorola Freezes DB Plan; Suspends 401(k) Match ).