Is it legal for a company to request employees to stop contributing to a 401K because the company cannot provide the matching funds that were previously agreed on?

Answer 1

Since "The Company" is asking nothing illegal from its employees in making such a request, there is nothing illegal involved by virtue of their request. What the officials of any company promise to employees is just a promise; and, things change. When it is no longer considered to be of benefit to a company to support such promises, revisions are made. In addressing these issues, it is not morality that is at stake--- it's business; and, there are a lot of things that may be "wrong" for a company to do that are in no way illegal. As far as the company asking the employees to avoid doing something which otherwise would be in the employees' interests to do, that's not illegal. If company policy provided you with "benefit-X" upon request, and the company decides to revise their benefits package to eliminate that option, there's nothing illegal about it--- regardless the reason the company might have for doing so. When it involves something like a 401-K plan, the details are a bit more intricate; but, there are never any "guarantees" for an employee that are not written in a black-and-white contract and/or supported by solid legislation. In the employment arena, the employer has the upper hand in most regards; and, it is best to remember one thing as you watch jobs and pensions and benefits packages evaporate around you this year: A promise is a promise is a promise, regardless of age...