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- Sep 9, 2009
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What are your guys vesting schedule for your 401k plans? I am considering a move to a different practice with a 5 yr vesting period. The vesting escalates percentages per year I'm with the group.
Any employee contributions are immediately vested. Employer contributions are on the a five-year vesting schedule. From an employer standpoint, it's a good retention tool.That's what we have for our employees.
Any employee contributions are immediately vested. Employer contributions are on the a five-year vesting schedule. From an employer standpoint, it's a good retention tool.
FWIW, from an employee standpoint, it causes employees (or prospective employees) to say "they must not be able to keep people otherwise, so they try to force them to stay this way."
From an employer standpoint, we invest a lot of time and effort into integrating our employees into our practice. We see two general groups of employees - those who stay for a year or two and head for what they perceive as greener pastures, and those who stay long term. We have a very large group, but we have a lot of long term employees, and we don't retain them by being a lousy employer. I've been with the group more than 20 years, but there are a dozen people with more seniority than me. We compensate our people fairly, and there are incentives for those who stay for the long haul. There's likely not a group in the southeast that can match my compensation package as a senior anesthetist, but I'm not where I am by jumping from practice to practice.FWIW, from an employee standpoint, it causes employees (or prospective employees) to say "they must not be able to keep people otherwise, so they try to force them to stay this way."
We have a very large group, but we have a lot of long term employees, and we don't retain them by being a lousy employer.
We're putting money in that whole time, from day one, which is a rarity for most employers. Many don't put in at all the first year. We match up to 6% every paycheck beginning with the date of employment - we don't wait till the end of the year - so twice a month, we're making pension contributions to our employees, not just once at the end of the year. In addition, there is a profit sharing contribution into the 401k at the end of the year. Any money the employee puts in is theirs regardless, so if they leave after a year, they take all of their contributions with them. It may not be perfect, but it's better than 95% of the plans I see from groups competing in our market.Glad to hear it. But then why let your vesting program put doubts in peoples' minds?
My attitude is "you've earned it, it's yours."
I should point out when I mention 5 year vesting that it is a percentage that increases annually.
Example, 20% vested after 1 year, 40% after 2 years, etc. up to 100% at 5 years. It's not like if you leave after 4 years you don't get to keep any of the employer contributions.