An uproar among Chicago Sun-Times newsroom employees has helped reverse a surprise fee slapped on their retirement plans.
Employees who are members of the Chicago Newspaper Guild complained to management that their quarterly 401(k) statements included unexplained May 20 fees of between $500 and $1,200 per person.
A June letter to employees from Prudential Retirement, bundled provider of the $57 million 401(k) plan, explained that the pro-rata fee was a result of the expense of combining some of the plans in a way that would reduce administrative expenses later. But Sun-Times Media Holdings CEO Jeremy Halbreich said he was unaware of the charge and called for it to be reversed as soon as he learned of it last week.
“I had the average reaction, which is ‘this is ridiculous,’ and we’re not going to do this,” Mr. Halbreich said.
Instead, the Chicago-based newspaper publisher will eat the $100,000 in costs for combining the plans, he said. Employees will see a restoration of the funds soon, including any gains or losses for the period when the funds were missing.
“We are glad this money is being restored, and we will check on the progress of that to make sure it happens quickly,” said David Roeder, a Sun-Times columnist and treasurer for the union. “A lot of people were very angry about the deduction, and they didn’t understand why it occurred — still don’t, as a matter of fact.”
Lynne Marek is a reporter for Crain's Chicago Business, a sister publication of Pensions & Investments.