AOL Inc., citing rising costs from President Barack Obama’s health-care law, changed its policy for matching employees’ 401(k) retirement plans to reduce expenses.
AOL, owner of websites such as the Huffington Post, will still match employee contributions to retirement plans up to 3 percent of their paychecks, Chief Executive Officer Tim Armstrong said. The difference is that it will make the matching payments in a lump sum at the end of the year, and employees who leave before then will forfeit the benefit, he said in an interview today on CNBC.
“Obamacare is an additional $7.1 million expense for us as a company,” Armstrong said. “We have to decide whether to pass that expense to employees or cut other benefits.”
The White House is defending the law from criticism that the economic pain it causes consumers outweighs the advantages in medical coverage. Republicans have seized on a report this week by the Congressional Budget Office, which said Obamacare will reduce the hours Americans work by the equivalent of 2 million full-time jobs in 2017.
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