to end pension plans for nonunion employees
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[March 07, 2014]
NEW YORK (Reuters) — Boeing Co <BA.N>
said on Thursday it will end pension plans for 68,000 nonunion
employees, including its chief executive, marking the latest step in
the company's shift away from defined-benefit plans.
The change takes effect January 1, 2016, and reflects the company's
effort to reduce the growing costs of its pension plans. Boeing said
it expects to take a $110 million non-cash charge in the first
quarter for the pension change.
The company previously announced charges of $140 million and $80
million for making similar changes to labor agreements with union
machinists in the Seattle area and in St. Louis.
Since 2009, all new hires of nonunion employees and new hires of
union employees represented by 28 unions have received
defined-contribution plans instead of pensions.
Boeing said the defined-contribution plans allow it to "better
predict and manage financial risks."
Nonunion workers including managers and executives will keep what
they have earned in their pensions through December 31, 2015, and
then switch to a new defined-contribution retirement plan, Boeing
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The employees will also keep an existing 401(k) plan in which Boeing
matches a portion of their savings.
The changes mirror those made to benefits of union workers.
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