Dow to freeze benefit accruals of U.S. pension plan
Dow disclosed Thursday in an S.E.C. filing that the chemical giant plans to freeze pension benefit accruals, effective Dec. 31, 2023. The move will reduce benefit obligations by $350 million to $375 million. Dow will also make a $1 billion voluntary contribution to its U.S. pension plan by the end of this month. The annual benefit of the U.S. pension plan is expected to decrease by $140 million to $160 million this year as a result of the contribution.
“The U.S. Plans will be amended to freeze the pensionable compensation and credited service amounts used to calculate pension benefits for active employees who are active participants on the Effective Date,” the filing said. “As a result, as of the Effective Date and subject to any bargaining obligations required by law, active employees who participate in the U.S. Plans will not accrue additional benefits for future service and compensation under the U.S. Plans and will begin to receive automatic contributions to the Savings Plans equivalent to 4 percent of their eligible compensation, starting on January 1, 2024.”
The Wall Street Journal’s MarketWatch reported the news.
Michael Westendorf is the chairman and executive editor of Chemical City Paper. As Executive Editor, he leads the City Paper’s news coverage and editorial team.