The global security and aerospace company says the transition will take effect in two steps: the freeze of pay-based benefits effective January 1, 2016, and the freeze of service-based benefits effective January 1, 2020. The company expects the plan will be fully frozen as of January 1, 2020.
When the freeze is complete, the majority of Lockheed Martin salaried employees, including approximately 25,000 not in the pension plan, will have transitioned to a DC retirement plan that offers up to 10% of employees’ salary annually in company contributions.
While the salaried pension plan was closed to new participants in 2006, approximately 48,000 employees of Lockheed Martin’s 113,000 employees are participating. An additional 250,000 retirees and former employees are in the plan.
Retirees already collecting benefits, as well as former employees with a vested benefit, will not be affected by the change. Current and former employees will also keep all benefits already earned in their pension plan to date.