Stepan Co., Northfield, Ill., today announced it will freeze its non-union pension plan for U.S. salaried employees and "certain participants in the U.S. hourly work force" as of July 1, and it will replace the defined benefit plan with a 401(k) plan, according to an 8-K company filing with the SEC. The action was approved by Stepan's board of directors Feb. 14.
Pension benefits earned through June 30 will be available to employees when they retire under the terms of the plan, according to the filing. The 401(k) plan will offer a 4% employer contribution of base salary, according to the filing. James E. Hurlbutt, corporate controller, said the 4% company contribution does not require an employee match, an enhancement on the DC plan previously offered. The 8-K also stated that certain longer-service employees will be eligible for a supplemental contribution from Stepan for up to five years.
The company has about $54 million in defined benefit assets and a $71.4 million 401(k) plan.