Strapped Companies to Suspend 401(k) Matches
Companies hurting from the Covid-19 pandemic are suspending or reducing matching contributions to their 401(k)s — or at least considering doing so.
“Normally, you would think that’s not that onerous a requirement, but under the current circumstances, where employers are needing to save money desperately,” they would like to stop the match more quickly, says Dan Morgan, a partner in Blank Rome’s employee benefits and executive compensation practice.
While smaller companies may be the most likely ones to reduce or suspend their 401(k) match in the current environment, some larger companies are also likely to do so, Morgan says.
“Companies are going to need to save money,” he says. “I think large businesses are already thinking about this,” he says.
"Strapped Companies to Suspend 401(k) Matches," by Beagan Wilcox Volz was published in Ignites on March 30, 2020.