3M Co. said Monday that it plans to end its pension plan for non-union U.S. employees in five years.
The consumer, industrial and healthcare products company
MMM,
said it has been moving from a pension plan to a 401(k) retirement-plan structure for “many years.”
“By moving to a 401(k) retirement plan structure, the company is focused on providing employees with more flexibility and control when it comes to investing in their future,” 3M said in a statement.
3M’s stock fell 0.6% in morning trading. It slipped 0.7% last week, after falling 8.8% in 2023. In comparison, the Dow Jones Industrial Average
DJIA
rallied 13.7% last year.
The people who are currently receiving pension payments from the company are not affected by this freeze, which will take effect on Dec. 31, 2028. The freeze applies for both 3M and Solventum, the independent health-care company which will be spun off in the first half of 2024.
“This is an important decision for 3M as it helps to set up both companies for futures success. This was also a difficult decision because it impacts employees across the United States,” Chief Executive Mike Roman said. “To help those impacted, we are providing five years of advance notice to ensure our employees can plan alternative strategies to meet their post-retirement income needs.”
3M’s stock has run up 22.1% over the past three months through Friday, while the Dow has climbed 11.7%.
