Sprint Nextel Suspends 401(k) Match

Financially ailing wireless communications provider Sprint Nextel Corp. is suspending its 401(k) plan match for 2009 as part of a drive to reduce costs by $1.2 billion.

The suspension of the 401(k) plan match comes three years after the company’s last retirement plan change. At the beginning of 2006, Sprint Nextel froze its defined-benefit pension plan. The change affected Sprint Co. employees who had been with the company before its merger with Nextel Communications Corp. Nextel did not have a defined-benefit plan.

Last year, Overland Park, Kansas-based Sprint Nextel matched 100 percent of employees’ salary deferrals, up to the first 5 percent of pay.

The suspension of the match is one of several cost-cutting moves at the company, including laying off about 8,000 employees by March 31.

For the nine-month period ended September 30, Sprint Nextel lost $1.18 billion on revenue of $27.2 billion. That compares with a net loss of $128 million on $30.3 billion in revenue for the first nine months of 2007.  (For more, read “Layoffs Coming, and in Large Numbers.”)

Filed by Jerry Geisel of Business Insurance, a sister publication of Workforce Management. To comment, e-mail editors@workforce.com.

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