|"I gotta letter from Fi-fi-feedelity? I think it's a check."|
First, Pfizer recently told employees that severance packages would be reduced as of mid-May. Now, the big drugmaker plans to eliminate its defined benefit pension plan as of 2018 and will direct employees to funnel their money into a 401K investment account, according to a company memo. And the pending changes will apply to all employees, including the c-suite crowd, a Pfizer spokeswoman tells us.
“The pension changes apply to colleagues at all levels, including executives,” the spokeswoman writes. “There are some exceptions, such as colleagues hired after (January 1), 2011, as they already participate in an enhanced savings plan, rather than a pension plan; certain union colleagues based in the US, per their collective bargaining agreement; and colleagues who were part of an acquisition and are not currently earning benefits under a Pfizer pension plan.”A commenter on the post clarifies what this really means:
To put in human terms, the people who are getting shafted the most are those with around 10-15 years to go before retirement. Basically, if you are turning 55 anytime around 2018, you lose all of the accelerated growth in your pension prior to full retirement, costing some up to $600,000 or more.I'm torn about pensions and whether or not they're economically possible in These Modern Times; it just seems to me that a promise from a company that "30 years from now, I'll pay you a modest sum of money for work you're doing today" seems a little tenuous. 30 years from now, we could all be floating in our Jetsons-like cloud palaces. Or more likely, I'll be traveling with my family through a desert wasteland in dune buggies, fending off marauding bandits while searching for an abandoned (yet still working) multiprobe NMR.*
In all seriousness, it's just one more kick in the shins to Pfizer scientists that have put in more time at the company, and now have to stash that much more in their 401ks and IRAs to prevent themselves from eating cat food at 72. Best wishes to them, and all of us.
*Hopefully, the Postman will come, bearing a Pfizer pension check. I won't hold my breath.