NU Online News Service, Dec. 9, 2004, 9:18 a.m. EST
International Business Machines Corp., Armonk, N.Y., says it will resolve a long-running dispute over pension plan design by shutting its cash balance pension plan to new employees.[@@]
IBM will offer the new employees a 401(k) defined contribution plan instead.
IBM angered some employees by converting to a “cash balance” pension plan from a traditional defined benefit plan in the 1990s.
Although IBM came up with several strategies for protecting the interests of older pension plan members, it has been in court defending its cash balance plan for years.
The company says that, even though it is closing its cash balance defined benefit plan to new employees, it still is committed to the defined benefit pension system.