2018 Plan Sponsor of the Year – Corporate 401(k) < 10MM

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Headquartered in Wilmington, North Carolina, PolyQuest, Inc., is a PET resins manufacturer and distributor employing just under 100 workers. Important to the company is offering great benefits to its employees—and it has recently become very proactive in doing so.

“We want to educate employees about the importance of planning for life after work and give them the best possible tools to feel knowledgeable and in control of their finances,” says Kimberly Mueller, human resources (HR) manager at the company. “That way, they won’t be struggling to make ends meet or relying only on Social Security once they retire. The goal of retirement should be relaxation, not worry, and we want that to be achievable.”

Before 2016, when the PolyQuest employees expressed disappointment in the lack of resources available to them in their 401(k) plan, the company listened. The HR department “was not as in-the-know as we should have been about our 401(k) plan, and we were not receiving attentive service or educational assistance from our provider,” Mueller says. Combine those deficiencies with an unwieldy number of unbundled plan providers and a separate third-party administrator (TPA), and a change was overdue.

Merrill Lynch was selected as the company’s new adviser, and the plan is now bundled, with MassMutual as recordkeeper. By mid-2016, the plan sponsor formed an investment committee, composed of the chief financial officer (CFO) and controller, along with Mueller, who worked with the adviser to design a plan for PolyQuest’s unique employee demographics and education needs.

After the company’s first education meeting, given by its new providers, participation grew to 85%, with 18 individuals enrolling or increasing their contributions during the meeting. PolyQuest now hosts education sessions twice a year. In January, 10 additional employees enrolled or increased their contributions in the plan.

Mueller says much of the plan’s success is due to the one-on-one contact offered by the team at MassMutual and Merrill Lynch, which provide PolyQuest’s workers with effective, easily comprehensible materials.

“They’re really good at putting everything in relatable terms for our employees,” she says. “Just getting [employees] to see that something as simple as not buying a pizza every week or a Red Bull a few days a week—the savings differential of investing that money in your 401(k) and the compounding of that amount over 30 years is dramatic.”

Additionally, the company continued implementing its 100% match of the first 3% of employee contributions, and 50% of the next 2%. Employees, Mueller says, are vested in the plan upon enrollment.

Employees’ impression of their retirement plan has almost completely reversed. As most of the employees work in shifts, MassMutual and Merrill Lynch are tasked with providing numerous education meetings, twice a year, and attendance has been strong. PolyQuest was concerned about how some participants would respond to the new plan, so the company decided not to add automatic enrollment or automatic escalation. However, the positive reactions following the plan’s execution proves auto-features could fare well with employees.

The company periodically surveys participants, asking which educational topics would benefit them most, and is considering launching annual report cards—personalized snapshots demonstrating each participant’s retirement readiness. The tool shows employees how close they are to their retirement goals and the impact a slight modification could make.

“It’s another way of making it pretty clear what their current situation is and how they can have an impact on changing that,” Mueller says.