Profit-Sharing Out at Wal-Mart in Favor of 401(k) Match

Wal-Mart Stores, the nation’s largest private-sector employer, plans to scrap its profit-sharing contributions in favor of a 401(k) match, according to a Bloomberg report.

Starting in February 2011, the retailer will match 401(k) contributions up to 6% of employee pay, according to a memo Bloomberg news service is reported to have obtained. 

Wal-Mart automatically put up to 4% of pay into the profit-sharing plan, spokesman David Tovar told Bloomberg. During the year ending January 31, 2008, Wal-Mart contributed $724.4 million to 838,955 hourly employees in profit-sharing and 401(k) contributions, according to a May 2008 company press release.

Money saved from the switch will go toward quarterly bonuses for store employees, according to the news report. Wal-Mart employs 1.4 million people in the U.S.