Before MRO’s executive suite decides to jump on the ‘cut the 401-K match’ “initiative” implemented by ExxonMobil, please note that ExxonMobil KEPT its dividend. It’s enough that Marathon employees have had to live under the CONSTANT fear of layoffs over the past five and a half years that maintaining the company match on the 401-K would be the LEAST Marathon could do.
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Marathon is NO Exxon. It just happened to hire a sh–ty employee for its CEO! You know, the one that has run it in the ground!
Sinatra time...
I’m a supporter of employees getting everything they deserve and I frankly think Marathon is a complete POS company, but how can you really defend an above market retirement benefit at this point? Sorry to say that Marathon employees aren’t exactly in a good position to demand benefits at this point. The good news is that you can still do so at other companies and in other industries.
They did cut the 401k match at many E&P companies in 2009. One disadvantage for sure for a company with negative earnings is that the 401k matches will no longer have the corporate advantage of being deducted since deductions are only good against positive earnings. As for being illegal, I said "may" since a profit sharing match while there are no profits goes against the IRS "no pay no play" policy. An individual can't contribute to an IRA without wage earning. An individual can't contribute to a 401k without compensation.
A pay cut would be better, as Covid has decimated social security contributions, there is no more non-contributory defined benefit retirement program (Marathon eliminated that ten years ago), Marathon eliminated retirement healthcare support for retirees over 65 years of age a couple years ago (note: Medicare, Parts A, B & Supplemental, according to my uncle (who retired from ExxonMobil) can cost over $1100 Monthly for a couple). At some point employees need to push back, and the 401-K match is about the only hope for one wanting to retire before 70, much less 65.
Malarkey. If there was a legal out for them to stop paying it, companies would've taken it back in 2009 or 2015 when there were also quarters of negative earnings. 401k match is a benefit just like any other. If enough companies stop offering it or they no longer need it to attract / retain talent, then it will go away.
A 401k match is defined by the IRS as a company profit sharing plan. Given that MRO's profit margin has been negative over the last two quarters, there is no profit to share. Under Section 415 of ERISA, it may not be legal to match if a company has negative net earnings.
Last year’s benefits survey will prove to be as helpful for employees as the return to office survey.
Was probably one of the answers from last years salary survey. Getting rid of 401 K match probably lost out to more work life balance.