HRM week 4

PENSION PLAN INFORMATION

To: CEO Smith <[email protected]>

From: [email protected]

Date: March 26, 2018

Re: Pension Plan and 401K Information

Blossoms Up human resource is now implementing a plan to cut budget cost, but their thoughts of aligning a pension plan that definitely benefit and fit the organization. Mr. Smith the CEO of Blossom Up! is giving the human resource team the opportunity to come up with a phenomenal pension plan Blossom Up organization in spite of increasing employee morale including bettering their future with Blossom Up. Human resource will have the opportunity to introduce the new pension plan including new materials so employees of Blossom Up can fully understand how it works so the result could be successful and beneficial.

Retirement Plan

In regarding of reducing budget cost, employees are concern that Blossom Up will not offer benefits and worried that employees will not like that idea in addition to that Blossom Up is prepared to make serious changes for the organization including having the opportunity to introduce a phenomenal retirement plan that will benefit floor employees to upper management. Furthermore, Blossom Up CEO believes that this will boost employee morale, a great way for incentive for the organization, another way to attract more skilled qualifying new candidates, and more promotions within. Bender has recommended a new benefit called 401(K). According to Kennen (2018), a 401K retirement plan is a special type of account funded through pre-tax payroll deductions”. Meaning Blossom Up employees will have the opportunity to choose the amount they want to be deducted as pre-tax dollars from their payroll check and Blossom Up will match up to 10% to including 100% at time of retirement. As Blossom Up continue to find other budget cut cost such as purchase recycle raw material instead of new materials, advertisement, including some marketing strategies cost. By implementing this plan Blossom Up will be able to use to reduce budget cost saving to contribute towards the 401(K) perhaps certainly contribute extra cash funds each additional months as possible.

Employee Retirement Income Security Act

In 1974 Congress establish, The Employee Retirement Income Security Act (ERISA) regarding standard of retirement, health, and possibly other benefits plans. Mainly ERISA protects retirement investment of Americans. This is great for Blossom Up, it is another incentive in protecting employees. According to “Tasc ERISA Plan” (2018), the protective laws under ERISA apply to employer-sponsored health insurance coverage and other benefit plans offered to employees by private employers (only). Meaning require plan are to be provided in order to participants regarding information of investment funds and other plan that are available for employees. Furthermore, items that consist standard regarding funding, investment, or any participation because law will show when employees are eligible for any benefit including some sort of detail or regulation.

Defined Benefit Plan & Defined Contribution Plan

Blossom Up human resource had the opportunity to research the defined benefit plan and the defined contribution plan understanding needs that will be placed so employees are able to review this matter. According to “CNN Money Ultimate Guide to Retirement” (2018), defined benefit plans are more costly for employers”. Meaning that employers will sponsor, computed data with a formula pertaining to service of employment and history of salaries. Defined contribution plan is basically that either employee or Blossom Up will have the opportunity to contribute on a regularly basis because future benefit will possibly fluctuate during investment earning and the opportunity to borrow from their retirement plan.

Conclusion

Bender has recommended to use this retirement plan, this definitely will increase morale within Blossom Up employees, furthermore, benefits packages will provide every employee with information and take this advantage of this retirement plan while working for Blossom Up. Employees have the opportunity to contribute their money from payroll and Blossom Up will match the contribution. I suggest that all employees including new candidates are recommended to read and understand how these plans will work.

References

CNN Money Ultimate guide to retirement. (2018). Retrieved from http://money.cnn.com/retirement/guide/pensions_basics.moneymag/index3.htm

Kennon, J. (2018). 401k Retirement Plan for Beginners Begin Providing for Your Future. Retrieved from https://www.thebalance.com/401k-retirement-plan-beginners-357115

TASC ERISA Plan. (2018). Retrieved from https://www.tasconline.com/biz-resource-center/plans/erisa-plan/