New York-based mass media company AOL Inc.'s chief executive officer on Saturday dialed back a planned cutback on employee retirement benefits. CEO Tim Armstrong also apologized for citing two women at AOL with "distressed babies" as reason behind its mounting healthcare costs that stirred controversy, Reuters said in a report.
According to the report, Armstrong released a memo to employees saying that AOL would revert its 401(k) policy to matching contributions on a periodical basis instead of the recently announced one lump sum by the year's end.
The New York Times, in a separate report, said that the policy change would have placed AOL employees in an unfavorable position. Those who opted out of the company before December 31 would be more disadvantaged.
In a memo seen by Reuters, Armstrong said that "on a personal note, I made a mistake and I apologize for my comments last week at the town hall when I mentioned specific healthcare examples in trying to explain our decision making process around our employee benefit programs".
Armstrong in a town hall meeting last week tried to explain the rationale behind the change in the company's employee retirement plan. To illustrate his point, the AOL CEO picked out two unidentified women who had babies with health problems and blamed Obamacare for increasing AOL's bill by millions of dollars, the report said.
Armstrong's comment was greeted by criticisms from employees and media alike. It also towered above AOL's fiscal year 2013 fourth quarter results, which was the best growth in over ten years, Reuters said.
The New York Times said that the incident was the second time in the past year that Armstrong had to apologize for unwarranted actions or comments during meetings. The AOL CEO in August fired an employee who was taking photographs of him at a meeting. Armstrong apologized four days after the episode.
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