Employees had previously been required to hold shares of Gillette Corp. until age 50, but that restriction was lifted at the beginning of April.
Restrictions on company stock in retirement plans have come under fire following the Enron debacle, where employees, unable to sell their stock due to restrictions had no choice but to watch their retirement savings dwindle.
According to a report by the Associated Press, Gillette will continue to invest its matching contribution, up to 6%, in Gillette shares, but will allow employees to sell those shares immediately.
In a similar move, AOL Time Warner Inc. also changed its retirement plan rules to allow employees to switch out of the company stock contributed by AOL, to other investment options. Until now, most matching funds were automatically invested in company shares and only employees aged 50 or older could transfer out of the stock.
The move came after the compensation committee of the board of directors reviewed the issue and approved the change for the plan.
AOL Time Warner contributes as much as $2,000 a year in matching contributions to each employee’s 401(k) account. About 80% of the group’s 89,300 employees participate in the plan.
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