retirement fund memo

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					MEMO

May 11, 2007

To: Employees currently participating in the YWCA Retirement Fund
From: Sylvia E. Cagle, Interim Executive Director
Re: Discontinuation of the automatic pay reduction for employees qualifying for the
YWCA Retirement Fund

While it has long been the practice of this organization to reduce the pay of
employees qualifying for the YWCA Retirement Fund by 5% and for the organization
to use the difference to contribute to the YWCA Retirement Fund on your behalf, we are
discontinuing this practice in favor of a more flexible approach. Effective immediately,
this 5% reduction will be eliminated, and your pay will be adjusted accordingly (i.e.,
increased).

This new approach will allow employees greater control over the manner in which their
compensation is allocated. For example, those of you interested in increasing your take-
home pay can do so by declining to contribute all or any of the 5% to the Retirement
Fund, whereas those of you interested in maximizing your Retirement Fund contributions
can do so by contributing the 5% to the Retirement Fund, provided that you can do so
without exceeding the personal contribution limitFor example, those of you interested in
maximizing your take-home pay can do so by declining to contribute anything to the
Retirement Fund, whereas those of you interested in maximizing your Retirement Fund
contributions can do so by contributing 1 to 10% of your net pay to the Retirement Fund.
Either way, the choice is yours. [I recommend against the changes highlighted in yellow
in the above paragraph because the point that we want to get across is not that employees
can control their contributions in general (which they already can do) but, rather, that
they can control whether and, if so, to what extent they will contribute any portion of the
5% reduction, over which they previously had NO control. I recommend replacing the             Formatted: Font: Bold
sentence in question with the following: “For example, those of you interested in              Formatted: Font: Bold
increasing your take-home pay can do so by declining to contribute all or any of the 5%
to the Retirement Fund, whereas those of you interested in maximizing your Retirement
Fund contributions can do so by contributing the 5% to the Retirement Fund, provided
that you can do so without exceeding the personal contribution limit.”]


As an additional benefit, in your next paycheck the YWCA will pay each of you a one-
time adjustment (this was at the suggestion of Judy Case, the new ED) equal to the 5%          Formatted: Not Highlight
reduction of your pay for the period January 1, 2007 to the present time. This payment
will not in any way impact any previous contributions to the YWCA Retirement Fund.

Finally, in the interest of smoothing your transition to the new approach, the YWCA will
continue its 10% contribution rate to the Retirement Fund until at least December              Formatted: Not Highlight
31, 2007. Thereafter, the YWCA's Board of Directors may adjust the
organization's contribution rate. with a decision that will be made in October of this year.
[I recommend against the language highlighted in yellow in the above sentence. It
suggests that any future changes to the contribution rate must be decided in October of
this year. The YWCA needs to be free to make changes at any time after December 31,
regardless of when the decision to make such changes is made. Moreover, employees do
not need to know when the decision regarding December 31 will be made.]


As always, you may add to the amount placed with the Retirement Fund on your behalf
with a voluntary contribution. Please see Cindy if you desire to do so.

				
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posted:9/17/2012
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