Never miss a story — sign up for PLANSPONSOR newsletters to keep up on the latest retirement plan benefits news.
Energy company Avangrid has implemented the BlackRock retirement income product LifePath Paycheck as part of an effort to attract and retain employees, and to differentiate their benefits from rivals in a competitive market.
Avangrid employees were familiar with BlackRock target-date funds already, explains Paul Visconti, a senior director of total health and retirement programs at Avangrid, after a BlackRock event announcing the company’s adoption of the product.
“The main reason is our employees were used to BlackRock already,” he says.
Avangrid implemented the BlackRock LifePath target-date funds as the qualified default investment alternative in 2021 and 70% of participants are invested in the TDF, Visconti says.
“We wanted to leverage something that we knew employees understood and were familiar with,” he says. Workers “understand [the BlackRock TDFs], so it was pretty easy, especially from a senior leadership perspective, to convince them that BlackRock [was the right choice] and that continuity would make a lot more sense.”
The energy services and delivery company worked with BlackRock, communicating the program to participants, using multiple methods.
“We had a had a multitouch communication effort from several communications [and] there were periods of time BlackRock was on-site at different locations or webinars,” Visconti says.
On-site meetings and webinars were held between January and early March and roughly 2,700 Avangrid employees participated, says Visconti.
“The committee just wanted to make sure that we weren’t going to roll something out that was going to confuse employees or overwhelm them,” Visconti says.
Avangrid decided to incorporate the paycheck-generating product as a method of appealing to distinct worker cohorts and “appeasing the different compensation structures,” adding greater equity to the retirement benefit, Visconti says.
“We’re trying to have benefits that lower-income workers can take advantage of as well as those that get paid well,” he says. “We feel like this is neutral … and helps all employees regardless of their compensation status.”
Avangrid’s combined union and nonunion 401(k) plan held $2.35 billion in retirement assets for 8,000 active and approximately 11,768 total participants as of the most recent data shared by the company, sent by email.