Liberty Mutual: we want our employees to be average

Liberty Mutual is cutting the benefits for most of its employees:

Under the new plan, the company will reduce the maximum sum it provides to match workers’ savings in their 401(k) plans to 6 percent from 7 percent. The insurer also will change its traditional pension plan to a more modest one that saves the company money. In addition, it will cut back insurance coverage for retirees.

Here’s their reason:

In a brochure for employees that describes the changes, Liberty Mutual said, “the retirement benefits we currently offer are not in line with market practice.” The company said it compared its benefits with those offered by 25 similar financial companies.

On the other hand, their last CEO made $200 million in four years and gets $3.3 million per year for his pension. The current CEO got $8.9 million last year. Here’s a  manager for compensation and benefits at the company:

Touhey said pay plans for employees and top executives “are based on a practice of benchmarking compensation and benefits packages in a robust way, with other companies of similar size and complexity, as we try to compete for talent at all levels of our organization.”

And here’s the CEO:

“Our commitment to building and sustaining a talented and diverse workforce has helped us to become a global leader in property and casualty insurance, and we will continue to make our investment in people a priority, both now and in the future.”

– David Long, President and Chief Executive Officer

I guess the priority in employees that he’s talking about is to make sure that employees don’t make too much. Otherwise, they might have to cut his pay. By the way, the company is touting how well they did in 2012, I guess that doesn’t matter when it comes to giving their employees benefits.

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