Honeywell Increases 401(k) Match in Response to Tax Law

Employee Benefits News examines legal developments that impact the employee benefits and executive compensation employers provide, including federal and state legislation, rules from federal...

By Carmen Castro-Pagan

Honeywell International Inc. is the latest company to boost employee benefits by increasing its 401(k) match contribution as a result of the recent tax bill.

Honeywell’s 2017 performance, together with the enactment of the tax bill, has enabled the company to increase its 401(k) match, President and Chief Executive Officer Darius Adamczyk said Jan. 26 in a statement. The move will provide a more secure retirement to Honeywell’s employees, Adamczyk said.

Eligible Honeywell employees in the U.S., Canada, and Puerto Rico will see a bump in their retirement accounts starting April 2018, a company spokesman told Bloomberg Law Jan. 26 via email. This is the third time Honeywell has increased the company match since 2008, the spokesman said.

The company wouldn’t say how much it will cost to increase the match or how many employees will benefit. Honeywell had approximately 131,000 employees as of December 2016, according to company data on the Bloomberg Terminal.

Honeywell joins a growing list of large companies that are using their tax savings to increase retirement benefits in response to the tax law. AutoNation Inc., Visa Inc., Nationwide Mutual Insurance Co., Aflac Inc., and SunTrust Banks Inc. also plan to increase their 401(k) matching contributions in response to the new law. American Express and SkyWest Airlines also announced they would boost their employees’ profit-sharing plans as a result of the tax overhaul.

Other companies have also increased employee compensation in recent weeks. Moreover, many large and midsize companies are considering making changes to their employee benefits, compensation, rewards, and executive pay programs in response to the change in the corporate tax rate, according to results of a Willis Towers Watson survey released this week. Increasing 401(k) and pension plan contributions were cited as the most common changes companies are considering.

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