Motorola will halt 401k matches and freeze pensions as it aims to save an additional $800 million.
The company said it will freeze its U.S. pension plans effective March 1. That's no surprise there given many companies with pensions have already made such a move. Motorola will preserve vesting and fund the existing plan.
What may be more annoying to Motorola workers is the suspension of 401k matches. Meanwhile, employees across most markets won't get a salary increase. The latest cost cuts are in addition to the restructuring plan outlined by Motorola. In October, Motorola said it would delay the spin-off of its reeling handset unit and cut workers. The handset business is a sick business that is bringing Motorola's other units down.
To lessen the latest blow, Motorola co-CEOs Sanjay Jha and Greg Brown take a 25 percent decrease in base salary for 2009. Brown will forgo 2008 cash bonuses. Jha gets his 2008 bonus guaranteed as part of his employment contract, but will reduce it in an amount equal to Brown's forfeited bonus.