Verizon announced a restructuring of retirement benefits for active management employees. These employees will retain pension benefits they have already earned, continue to be eligible to grow into their early retirement pensions, and on June 30, 2006, receive an 18-month enhancement to the value of their pension and retiree medical benefits.
In addition, Verizon plans to increase matching dollars for its Management Savings Plan (401k) for these employees as well as for MCI managers who join Verizon after the close of the planned Verizon/MCI merger.
After June 30, 2006, Verizon management employees will no longer earn pension benefits or receive any additional service credits toward the company’s subsidy of retiree medical benefits.
Verizon said these changes will provide the company with pre-tax net savings, including the effect of the increase in the savings plan match, of approximately $3 billion over the next 10 years.
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