For the last two years, employers have been pushing stay-the-course themes within their 401(k) communication and educational programs, but some do it a little better than others.
In 2009, The Profit Sharing/401k Council of America announced the winners of its Signature Awards competition, which honors employers with innovative 401(k) and profit-sharing communication and education programs. The group also honors defined-contribution plan providers. The judges reviewed the applications of 211 companies, awarding 50 of the entries in 17 categories.
The recession and resulting stock slump meant that more applicants in the competition had tailored their employee education programs around themes of staying the course, says David Wray, president of PSCA.
One company in particular stood out among the pack. Forest Laboratories, Inc. won the prestigious Best of Show award, which lauds the employer who excels across the board with its communication and education program.
The New York-based company hosts an annual week-long 401(k) education event called Financial Health Week. The event focuses on educating workers on diversification, increasing the use of target-date funds and taking advantage of the company match. The 2008 multimedia campaign included mailings, e-mail announcements and reminders, posters, handouts and giveaways, face-to-face meetings and webcasts.
Although the material was designed way in advance of the economic downturn, the company still managed to adapt the information to address employees' concerns about saving for retirement.
For FHW, the company offered one-on-one sessions, group meetings and webcasts about the stock market slowdown. Forest also added two more webcasts on money management basics that addressed how investors needed to respond to the market's volatility.
"Workers were saying, 'I am hearing this scary economic news and trying to figure out: What does it mean if I am 25-year-old or 45-year-old investor?'" explains Bill Stappenbeck, senior director of employee communication. The company, which employs fewer than 5,000 workers, makes a 50% match on the first 6% of what an employee contributes.
The pharmaceutical outfit also targets certain individuals who may need guidance on developing investment strategies. For example, the lead-off mailing for the 2008 FHW went to 1,159 employees who the New York-based company felt were not properly diversified in their 401(k) account based on their age. Yet after FHW, 19% of them took action and are now better diversified, says Stappenbeck.
The big picture
FHW probably caught the judges' attention because it has a cohesive message, clear directives and a diversity of communication touch points. But equally important, the material has meat to it, which made it a success, notes Stappenbeck.
The company scheduled FHW to take place in September 2008, capitalizing on the presidential campaign with the theme "Decision 401(k)." At the worksite, employees saw signs that resembled political campaign posters that voters place in their front yard.
To give the 2008 FHW a strong identity and brand, the company tied FHW with the 2008 presidential election, using bright colors and bold images associated with political campaign. Participants also received campaign trail-mix bags, a campaign survival kit as a raffle prize and pins resembling campaign buttons.
"People don't want to think about retirement readiness in tough economic times, and younger people tend not want to think about it at all," says Stappenbeck. Therefore, "you need to look at creative and compelling ways to engage people on a subject that they might not gravitate toward naturally."
The ability to mix one-on-one meetings with seminars and webcasts was important for the company because it wanted to deliver content through multiple channels.
"We have a large population that is field-based. While those workers might not have the convenience to do a one-on-one, they are included in the web casts and other communication. They have the ability to pick up the phone to engage in further interaction," explains Diane Thrasher, executive director of compensation and benefits.
She urges employers to recognize their overall goals on getting workers to adequately save for retirement, realizing that those goals might be met through a combination of plan designs and communication efforts. Both, however, should reinforce and complement one another.
Express Scripts, Inc., a Missouri-based pharmacy benefit management company, picked up the top prize for best 401(k) educational program emphasizing language and cultural diversity.
PSCA lauded the company, which employs 11,500 workers, for creating unique cross-cultural tools to overcome obstacles associated with language or cultural diversity among the targeted employee population.
The employee groups that Express Scripts focused on for the educational outreach were the Asian and Hispanic populations, which make up 9% and 10%, respectively, of their total workforce.
"Our desire is to educate all of our employees on the importance of planning for retirement, but we also realized that we had pockets of employees who do not have English as a first language," explains Jane Bjorndal Loe, director of compensation at Express Scripts.
"We felt it was important to develop and coordinate with our 401(k) plan vendor, New York Life Retirement Plan Services, an educational program customized for individuals whose first language was not English," she adds.
In 2008, the company offered in-person and virtual 401(k) plan meetings held in Spanish, Vietnamese, Cantonese, and American Sign Language. It also printed materials in Spanish and Braille. The Spanish language materials and presentations yielded a 6% increase in calls to the plan call center in the first month following the presentations.
Moreover, the plan's participation rate jumped five percentage points, from 59.1% in first quarter of the year to 64.5% at the end of the second quarter. The average deferral rate also increased from 6% to 7% of salary.
2009 PSCA Signature Award winners
* Best of Show
Forest Laboratories, Inc.
* Asset Allocation
Gold, The Timken Company
Silver, Data Device Corporation
Bronze, Coca-Cola Enterprises Inc.
* Complete Campaign - Small company
Gold, Forest Laboratories, Inc.
Silver, Kawasaki Motors Corp., U.S.A.
Bronze, Merial
* Complete Campaign - Large Company
Gold, Nestlé USA, Inc.
Silver, Continuum Health Partners, Inc.
Bronze, Parsons Corporation
* Increasing Deferrals
Gold, Reed Elsevier
Silver, Bemis Company, Inc.
Bronze, Nestlé USA, Inc., and Corinthian Colleges, Inc.
* Increasing Participation - Small Company
Gold, EmCare
Silver, National Wildlife Federation
Bronze, M. A. Mortenson Company
Honorable Mention, M. A. Mortenson Company
* Increasing Participation - Large Company
Gold, MGM Mirage
Silver, The Talbots, Inc.
Bronze, Genzyme Corporation
* Language and Cultural Diversity
Gold, Express Scripts, Inc.
Silver, National Oilwell Varco
* Plan Conversion
Gold, The Metropolitan Opera
Silver, Honda of America Manufacturing, Inc.
Bronze, Safeway
* Plan Design Changes
Gold, Ascension Health
Silver, Navistar, Inc.
Bronze, Carolinas HealthCare System
* Retirement Readiness
Gold, Forest Laboratories, Inc.
Silver, Aetna Inc.
Bronze, Bailey Nurseries, Inc. and Silgan Containers
* 401(k) Day
Gold, Advantage Sales and Marketing
Silver, Universal Orlando
Bronze, Zachry Holdings, Inc.
Source: The Profit Sharing/401k Council of America_SClB
