Benefits innovator spotlight: Microsoft
Editor’s note: This is one of 10 employers chosen for Employee Benefit News’ Benefits Leadership awards, spotlighting companies who are taking a fresh approach to employee benefits.
Last year, tech giant Microsoft announced a sweeping overhaul to its employee benefits package — doubling the amount of paid time off new parents will receive, adding companywide holidays and reworking its 401(k) matching program.
Notably, in January, Microsoft increased the company’s 401(k) match program, matching 50% of employee deferrals up to $9,000 per year. That’s a significant increase from the company’s previous employer match, which was 50% of the first 6% employees deferred, to a maximum of 3% of pay.
The decision to increase the 401(k) match was based largely on a desire to equalize healthcare and retirement benefits, says Sonja Kellen, director of global retirement benefits for Microsoft.
“We review our benefits portfolio every year, looking at it holistically in terms of the investment we’re making from a cost perspective, but also how we’re benchmarking among our peers,” she says. “We wanted to balance it out a little bit more. Our health plan is incredibly generous; we find [it] to be one of the best in the industry. We wanted to make sure that we had equally as much investment in our financial benefits.”
Included in those financial benefits are one-on-one financial coaching sessions with a Fidelity representative; tools and resources, including Willis Towers Watson’s myFiTage online tool, which helps employees understand at what age they’ll become financially independent and be able to live without a paycheck; and Microsoft’s total rewards portal, which Kellen says is a broad-based look at the total investment Microsoft makes in its employees. The company offers immediate enrollment in the 401(k) plan, with 100% vesting from day one.