American companies are taking care of underfunded pension programs by transferring funds or offering voluntary payouts to employees, according to Reuters.
While companies like AT&T and Verizon transferred $9.5 billion and $7.5 billion respectively, other companies are offering voluntary payoffs to lighten the burden of pension commitments before they become a bigger problem in the future.
Kimberly-Clark, tissue-making company, recently told about 10,000 former employees they would be able to collect a lump sum payment.Comment on this story
"It takes some of the volatility out of the pension plan going forward," Bob Brand, a spokesman for Kimberly-Clark told Reuters.
Companies participating in voluntary payouts include General Motors, Ford, Taco Bell and several others.
Pension funding hit 71.4 percent of commitments in July, the lowest since BNY Mellon started keeping track in 2007.
Rising retirement costs, lower returns on investment and interest rate projections are forcing companies to handle the issue before it gets out of hand.