401K - Company Match (Um, Hasn't Matched Lol)

Updated on August 14, 2012
J.C. asks from Old Monroe, MO
6 answers

So, I find out today after working for this company for 5 years that our 401k match is contingent on cash flow! Has anyone else ever had this? It doesn't say it in the handbook..lol Is this a you is understood, that I didn't understand??? Feeling a little "dumb" at the moment.

BTW - our office is doing wonderfully, it is the other offices that have in-house fitness programs, free lunches every other week, etc that have went over our budget. Guess we all have to pay the price though. hmph!

Also, please feel free to share any "I found that out the hard way at work" stories...

A few more details... Our match is a little difficult to explain (see below). Though I must say our HR is in our corporate office & nobody ever sat down and explained my benefits totally to me (not even vacation accrual), honestly! I was sent a packet to fil out & send back & that was the extent of it.

They (HR) did come down here 3 years ago, when we hired new ones & stated our 401k was sent out to a 3rd party to decide how the match would be split, with the little people getting 100% match and dividing with specific calculation (she didn't know the formula) for the "large savers" (not her exact words). Never stated it was contingent upon cash flow, but never said it wasn't.

Now, our December Profit Sharing bonus, is contingent upon cash flow & we know that up front, which of course is scaring the s*** out of me if we don't get either..???

Okay..so another edit..and actually another question...Why doesn't HR come out & tell their emplioyees what they have coming to them?? I have never figured that out. Why should I feel greedy & have to ask...So what else besides my paycheck are you going to give me for working here...??? Could go on, on that one....

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More Answers

J.W.

answers from St. Louis on

Have to ask, what is the "guaranteed match"? We have a 4% match at fully participating but beyond that there is more. Over the five years I have been there it has been closer to 10%. You must be fully participating to get into the profit sharing.

I only ask because it would be a shame to be angry with your employers and coworkers if it is a simple misunderstanding.

Now my husband's and my ex's companies are straight up profit sharing for those that participate.

Guess I am saying unless you sat down with HR this is pretty much on you.

Can you tell I work HR? Then again when I explain people usually go ohhhhh, they don't want to hurt another department. :)

1 mom found this helpful
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D.M.

answers from Kansas City on

Your HR dept. should have given you a Summary Plan Description, which in layman's terms will describe the basics of the 401(k) Plan to all Participants. If you haven't received this, then they should give it to you if you ask. The SPD is required by law. The SPD will explain your benefits and what types of contributions your company will make (either elective or nonelective). If you have a 3rd Party Administrator, find out if they have a website and sign-up for it. It is customary for Participants to receive quarterly benefit statements detailing the contributions made each quarter, earnings and total account balance. If you've been receiving these - review them and keep them! I've kept mine for years along with info sent out from the Social Security Dept. If you have questions after reviewing the SPD and your statements, ask the HR dept. If they are unable to help, then find out if the 3rd Party Administrator has a hotline you can call. Benefit plans can be complicated and not all HR depts understand the ins and outs.

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S.H.

answers from St. Louis on

yes, my husband's is contingent upon profits posted....as is the profit-sharing. Read your handbook & then make a list of questions. Ask HR to share the answers from the handbook....which will then point out to them their lack if it's not in the book. :)

~.~.

answers from Tulsa on

Yes. My company has a nonelective contribution that every employee gets each year regardless of profits, but the match is contingent on profits. My company is very good on explaining benefits when you first start and each year during annual enrollment. They also have a website that you can go to at any time and read up on everything. My company doesn't match much, but we have a defined pension plan, plus an extremely generous vacation and sick leave, not to mention cheap, cheap, cheap benefits.

If your HR rep was just explaining stuff to you without any paperwork, it's very possible they forgot to tell you it was contingent on cash flow. Get some paperwork or a website you can go to to read up on everything.

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A.L.

answers from Chicago on

Yes our company also has a match that is dependent on how the company is doing. As an HR person we do a similar situation with new hires, because it simply is not possible to go to each and every office to meet with new hires on the benefits. There are only 2 of us in HR for 300 employees and 1500 Independent contractors and it just is not feasible to go out to the offices when someone is hired.

We do e-mail the new hire paperwork to them along with a summary of benefits that explains all the benefits. We also make sure they know and read the employee manual which is posted on line and that they are welcome to call regarding any benefit questions at any time. Sometimes it is just not feasible or cost effective to have HR come to every office.

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S.B.

answers from Kansas City on

you should get out your handbook and read it carefully. I have never heard of the match being contingent on profits. I worked at a company where they lowered the amount they would match, but they told us up front at a meeting, it wasn't sprung on us. You need to read your handbook and possibly talk to a lawyer.

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