AOL Corp. CEO Tim Armstrong has abandoned an unpopular
plan to delay company contributions to employee retirement accounts and
apologized for citing two high-cost births as part of the impetus for
the plan.
"We heard you on this topic," Armstrong wrote in a letter to employees Saturday.
In
a move to cut costs, AOL had decided to pay matching 401(k) retirement
contributions in one lump sum at the end of the year. Workers who left
the company before the end of the year would have received no
contributions, and all workers would sacrifice interest or earnings on
those contributions throughout the year.
After a worker backlash,
Armstrong said the company would return to depositing matching
contributions every pay period throughout the year.
In the letter
Saturday, Armstrong also apologized for bringing up specific health care
examples during a town hall meeting in which the retirement plan was
discussed. During the meeting, Armstrong cited higher health care costs
in general and mentioned the high cost of health care for two women who
gave birth to "distressed babies."
"On a personal note, I made a mistake and I apologize for my comments last week," he wrote in
the letter Saturday.
On
Sunday, the author Deanna Fei wrote in an article posted on the website
Slate that she was the mother of one of the babies Armstrong referred
to. Fei’s husband is an editor at AOL-owned Huffington Post.
In
the article, which was being widely shared on social media, Fei explains
in detail the harrowing and difficult birth of her daughter and
excoriates Armstrong for blaming the need to reduce employee benefits on
situations like hers.
She wrote that she takes issue with "how
(Armstrong) exposed the most searing experience of our lives…for no
other purpose than an absurd justification for corporate cost-cutting."
___
ONLINE: http://slate.me/1fVCSLq
Copyright 2014 The Associated Press. All rights
reserved. This material may not be published, broadcast, rewritten or
redistributed.