AOL puts aside unpopular idea for retirement funding
February 11, 2014, 12:10 am TWN
AP--AOL Corp. CEO Tim Armstrong has abandoned an unpopular plan to delay company contributions to employee retirement accounts and apologized for citing two high-cost births as part of the impetus for the plan during a town hall meeting.
"We heard you on this topic," Armstrong wrote in a letter to employees Saturday.
In a move to cut costs, AOL had decided to pay company-matched retirement contributions in one lump sum at the end of the year. Workers who left the company before the end of the year would have received no contributions, and all workers would sacrifice interest or earnings on those contributions throughout the year.
After a worker backlash, Armstrong said the company would return to depositing matching contributions every pay period throughout the year.
On Sunday, the author Deanna Fei wrote in an article posted on the website Slate that she was the mother of one of the babies Armstrong referred to. In the article, which was being widely shared on social media, Fei explains in detail the harrowing and difficult birth of her daughter. She wrote that she takes issue with "how (Armstrong) exposed the most searing experience of our lives ... for no other purpose than an absurd justification for corporate cost-cutting."