Motorola Inc., Schaumburg, Ill., will permanently freeze its U.S. defined benefit pension plans effective March 1 and temporarily suspend matching contributions to its 401(k) plan effective Jan. 1.
The actions came as the result of the sustained downturn in the global economy, Greg Brown and Sanjay Jha, co-CEOs, said in a news release.
The company will preserve pension assets accrued by current employees and retirees but will eliminate future benefit accruals. The company will continue to provide funding to meet its pension obligations to current and future retirees, the news release said.
Motorola had total plan assets of $8.8 billion as of Sept. 30, with $3.8 billion in defined benefit assets and $5 billion in 401(k) assets, according to a Pensions & Investments survey. Jennifer Erickson, a spokeswoman with Motorola, did not immediately respond to requests for additional information.