401(k) matching - what's in it for the employer?

Even the smallest company I worked for (about 100 employees) had immediate 100% vesting, but other places have all been significantly larger. The big boys, Lockheed, Raytheon, Boeing, Northrop, all have immediate vesting. And the mid-size companies I am familiar with do as well.

My guess would be that the intense competition among the companies for qualified engineers and scientists is what leads them to offer 100% immediate vesting. It’s quite common to jump ship, although the current economy has slowed that down a bit. Benefits are certainly a consideration of employees shopping for a new company.

I can’t remember what the government labs offer, maybe its the competition with them that leads to the immediate vesting plans.

Yarster, companies or divisions that have poor management quickly lose their competent employees. As an example, I know one company that started treating its employees poorly. They lost basically all their engineers and got their government contract cancelled for failure to perform. I don’t know the fate of those managers, but debooking a multi-million-dollar sale cannot look good at a performance review. As a rule, managers are competent in this industry.

The matching funds provided by my employer go directly into a fund that purchases their stock. You can move it out of there if you like, but I’m guessing many employees just leave it there. That is certainly a benefit to the company.

No one who ever worked for or understands Enron will ever let the majority of their 401K consist of company stock…

Or Carter Halley Hale stores.

Macy’s did away with their pension plan and converted it to a defined cash account. Every year they would put in a set amount baised on your pay. This in addition to their 401K. the reason, pension accounts require a lot of paper work a defined cash account is just the amount added, interest, and ballance. And when you leave the company just one roll over check if you take your money out. They may do different today, I worked for them in the 90’s.