In 1974 Employee Retirement Income Security Act (ERISA) has transferred pension responsibility from employer to employee. Employer’s Pension, also known as the Defined Benefits Plan, which was common in the past, is still offered by some companies. For those, who looking for a job, we recommend visiting their websites for possible employment. Below is an article about pension plans, offered by 13 companies.
13 Surprising Companies That Still Give Out Pensions
By Karen Bennett
May 5, 2018
When it comes to pensions, the reality is that companies obligated to pay them out are collectively coming up short by trillions of dollars. As a result, most of these employers have decided to freeze their pension plans and switch over to 401(k) plans, where the employee is on the hook to plunk down the majority of the money saved.
Between 1998 and 2015, the percentage of employers still offering traditional pension plans to new hires fell from 50% to 5%, according to benefits advisory firm Willis Towers Watson. Here we’ll take a look at 13 big companies that are surprisingly still funding pension plans and offering them to new hires once vested. Following that, we’ll see two of the latest big companies joining the ranks of those freezing their pension plans.
The old slogan “Have a Coke and a smile” may hold even more meaning for employees who are smiling because they get a pension. Coca-Cola, based in Atlanta, employs 123,000 people and provides everyone with a pension plan – including new hires once they are vested. The retiring employee gets a life annuity at his or her normal retirement age. Coca-Cola employees on Glassdoor reported becoming vested in the pension plan after two years with the company.
2. Johnson & Johnson
Johnson & Johnson provides some popular household brands of baby and personal care products, including Aveeno, Neutrogena, Band-Aid, Neosporin, and Listerine. The company, reputed to have excellent overall benefits, is based in New Brunswick, New Jersey, and employs 127,000 people. A pension is provided, which is still available to new hires once they are vested.
Employees reported on Glassdoor they become vested in the pension plan after five years with the company. “Best thing is that they have a pension plan!” one employee posted there. “Also, if you have enough years with the company they pay your health insurance in retirement.”
ExxonMobile is the largest of the world’s Big Oil companies and the largest refiner in the world. Based in Irving Texas, the company employs 73,500 people. Employees are provided with a pension. This includes new hires, once vested. The pension’s defined benefit system includes a formula that will calculate the retirement benefit for you based on your years of pension service pay and expected Social Security benefit. When you retire, you can tell the company how you want to draw from your pension and when you want the payments to start.
Per ExxonMobil employee comments on Glassdoor, you’re vested in this plan after five years of employment, and you can start collecting at age 55. Employees also reported ExxonMobil offers a 401(k) match.
4. JPMorgan Chase
JPMorgan Chase & Co. is the largest bank in the United States. Headquartered in New York, the company employs 252,000 people and operates 5,100 bank branches across the country. The company provides a pension plan, in which new hires can still become vested, in addition to a 401(k) plan. Employees have the option to take their pensions as a lump sum or as monthly payments. Employees on Glassdoor reported being vested after three years with the company.
Prudential Financial, Inc. is a Fortune 500 company which provides financial products and services to clients, including life insurance, mutual funds, and pension- and retirement-related investments. Likewise, Prudential also provides a pension plan to employees, including new hires who go on to become vested. Prudential Employees on Glassdoor reported receiving a pension plan, in addition to a 401(k).
Merck & Co. is one of the largest pharmaceutical companies in the world. The company, established in 1891, developed the first vaccines for mumps and rubella. Its headquarters are in Kenilworth, New Jersey, and it employs 70,000 people. A pension plan is available to those who become vested after five years, employees reported on Glassdoor. It was also reported that Merck was projected to contribute $235 million to its pension plan in 2017.
7. Eli Lilly & Co.
Eli Lilly & Co. is a pharmaceutical company founded in 1876. It is known for being the first company to mass-produce penicillin, the polio vaccine, and insulin. Today the company produces well-known drug brands Prozac, Cialis, and Cymbalta. Headquartered in Indianapolis, the company employs 42,000 people, roughly half of whom are outside the United States. The company still provides pensions, as pharmaceutical companies historically are known for doing. However, the pension has been reduced in recent years, according to employee reports on Glassdoor.
Back in 2013, The Wall Street Journal quoted an Eli Lilly spokesman as saying the company viewed pensions “as a competitive advantage in attracting and retaining top scientific talent.” He added that the company had “no intention” to close its plan to new hires “soon.”
Known for its commercials featuring a loudly quacking duck, Aflac Inc. is the largest provider of supplemental insurance in the United States. One policy the company is known for its payroll deduction insurance coverage, which pays out cash to policyholders in the event of accident or illness. Headquartered in Columbus, Georgia, the company employs 9,000 people. In 2015, when it made the list of 100 Best Companies to Retire From, Fortune reported a pension plan as among the benefits offered to Aflac employees.
BB&T is the country’s 15th largest bank-holding company. It employees 30,000 people and still has an unfrozen pension plan. This means new hires can go on to become vested and participate. The plan is 125% funded, according to one report. According to Pensions & Investments magazine, this makes it the second-best corporate-funded pension plan in the United States. In addition, as a supplement to the pensions, BB&T also offers employees a 401(k) plan – which it matches 100% up to the first 6% of employee savings. BB&T employees on Glassdoor reported becoming vested in the pension plan after five years with the company.
10. Pacific Gas & Electric Company
Pacific Gas & Electric Company, also known as PG&E, is a utility headquartered in San Francisco that employs 23,500 people. It provides natural gas and electricity to most of the northern two-thirds of California. The company provides a pension plan, including new hires who become vested after five years, employees reported on Glassdoor
11. NextEra Energy
The energy company provides the best corporate-funded pension in the country. NextEra Energy is a Fortune 200 energy company based in Juno Beach Florida with 14,000 employees in 27 states and Canada. Its subsidiaries include power companies. The pension plan is 148% funded, which makes it the best corporate-funded pension plan in the United States according to Pension & Investments. Employees reported on Glassdoor they became fully vested after three years with the company.
12. JM Family Enterprises
JM Family Enterprises is an automotive company headquartered in Deerfield Beach, Florida, with subsidiaries including the largest distributor of Toyota vehicles. Among the benefits, which were praised by employees on Glassdoor, are both a pension and a 401(k) program.
13. NuStar Energy
NuStar Energy, based in San Antonio, Texas, is one of the largest independent pipeline operators in the nation. The company owns 8,700 miles of pipeline in total. When NuStar made the list of 10 Best Companies to Retire From in 2015, Fortune reported it provided its employees with both a company-funded pension program and a 401(k).
Read on to see which two big companies announced in 2017 they’ll freeze their pension plans.
UPS is a multinational package delivery company headquartered in Sandy Springs, Georgia. It employs a total of 434,000 people. The company was founded in 1907, and for many years it provided a pension plan to its employees.
In June 2017, however, UPS joined the ranks of other large employers in moving away from defined benefit pension plans. At that time, the company told 700,000 nonunion workers that it would freeze their pensions. As a result, in 2023, those workers will only be able to receive pension benefits they have earned up to that point. The company, which was $7 billion short in funds to pay out future pensions, said it would switch over to providing 401(k) plans and would contribute a percentage of workers’ salaries into those.
15. General Mills
General Mills manufactures many common household food staples, including brands Betty Crocker, Yoplait, Pillsbury, and Cheerios. The company, based in Minneapolis and founded back in 1856, currently employs 39,000 people.
Like UPS, in 2017 General Mills announced it would freeze pension plans in coming years. In this case, its defined benefit pension plans will stop accruing additional benefits at the end of 2027. In addition, the plan will be closed to non-union production employees hired after Jan. 1, 2018. (The pension plan had already been closed to salaried new hires starting in 2013.)