Journal Communications is one of the rare US companies that still has a defined benefit retirement plan. That will no longer be the case for new hires next year – plus, the plan will be frozen for current employees as Journal turns to its 401(k) plan as its primary vehicle for employee retirement savings.
Beginning January 1, 2011, Journal will offer enhanced 401(k) matching contributions. In addition, also effective January 1, the existing retirement plans have been amended such that benefit accruals in the current Pension Plan and the Supplemental Benefit Plan (SERP) will be permanently frozen and the Annual Employer Contribution (AEC) will no longer be a component of the 401(k) Plan.
Starting in 2011, Journal Communications will match $0.50 on every dollar up to 7% of eligible pay for a maximum match of 3.5%. The prior match was $0.50 on every dollar up to 5% of eligible wages for a maximum match of 2.5%. All employer contributions will vest 100% as soon as they are made. In addition, Journal will begin offering a Roth 401(k) option for after-tax contributions.
“We believe this decision allows us to maintain our financial flexibility while still offering a solid retirement benefit. Enhancing our 401(k) matching contributions will help us recruit and retain talented people as competitive 401(k) plans are a valued benefit in today’s workplace,” said CEO Steven Smith.
In February 2009, Journal Communications temporarily suspended 401(k) matching contributions. Additionally, the company suspended benefit accruals to the pension plan, SERP and the AEC for an 18-month period beginning July 1, 2009. The changes effective January 1, 2011 impact only active employees of Journal Communications. The pension plan freeze will not affect the benefits of retirees, beneficiaries or terminated vested participants of the Pension Plan, the company noted.
Journal owns and operates 33 radio stations and 13 television stations and also operates an additional television station under an LMA. On the print side, it owns the flagship Milwaukee Journal Sentinel and several community newspapers and shoppers in Wisconsin and Florida.