Akin Gump Strauss Hauer & Feld LLP

AKIN GUMP STRAUSS HAUER & FELD LLP, an international law firm with its home office in Dallas, has evolved its 401(k) plan design over time to keep up with current best practices. Six years after making substantial changes, it has a 97% participation rate and 9.6% average deferrals.

“We’ve been very intentional about our plan design,” says Chief Human Resources (HR) Officer Meg Meserole of the law firm. “We could just run a 401(k) program and ‘set it and forget it.’ But we like to get people to think, and look forward to a retirement where they’re very comfortable.”

Plan Design Enhancements

In 2015, Akin Gump made several enhancements to its plan’s design. “It was time to elevate the plan,” says Director of Financial Benefits Jessica Chicorelli. The automatic enrollment default rate increased from 3% to 5%, which was then the industry standard for peer employers, she says. The automatic escalation ceiling also rose, from 10% to 15%. New hires are immediately eligible to participate, and the employer contribution vests right away, as well.

The auto-escalation change was aimed at getting participants to the right savings level over time. “Our goal is for our folks to achieve a 70% income replacement in retirement,” Meserole says.

In keeping with that, says Chicorelli, “Moving people up to 15% put us in line with our goal for our participants to contribute at least 15% a year.”

Also in 2015, the Akin Gump plan started doing an annual re-enrollment sweep of any employees who had not contributed to the 401(k) during the previous year. “Each year that we have [performed] this re-enrollment, there has been a different list of employees being re-enrolled,” Chicorelli says. “That tells me the people we re-enrolled in previous years stayed enrolled.” On average, 70% of employees who were re-enrolled in the annual sweep stuck with it; 30% opted out of participation.

“We recognize that people’s circumstances change, year over year,” Meserole says. “So that’s why we’re being intentional about enrollment, to put it in front of them every year.”

For eligible employees who contribute at least 4% of their pay, the 401(k) plan matches 10% of the person’s total contribution up to the Internal Revenue Code (IRC) 402(g) annual contribution limit—currently $19,500—plus 10% of 50-plus-year-old participants’ catch-up contributions, which could be as much as $6,500. Akin Gump also makes a profit-sharing contribution to the 401(k), equaling 7.5% of an eligible employee’s total compensation. The 401(k) plan added a Roth feature 10 years ago, so employees could save after-tax dollars.

Financial Wellness Evolution

Akin Gump has evolved its financial wellness program since beginning it in 2007, and the program is now a multidimensional effort involving several providers. “We recognized that if employees didn’t have their present financial life in order, they would have a difficult time planning for retirement,” Chicorelli says.

Akin Gump formally launched its “Be Well” program in 2013, then relaunched it in 2016, when it implemented a third-party wellness platform from Aduro. An employee can use the Aduro platform to complete an initial health assessment, which explores that person’s well-being in the physical, mental, financial and social dimensions. After an employee completes the assessment, the tool identifies where that person is doing well, along with the areas in which he may need more support. “Different activities and informational resources are then highlighted in the system,” Chicorelli says. “And employees receive points with completed activities, which [add up for] achieving three different levels of wellness, with a cash award paid according to the level reached.”

Akin Gump employees also have access to a financial wellness platform from Prudential Financial Inc., the firm’s life insurance provider. That platform includes resources and educational programming on topics such as debt reduction.

Additionally, the firm works closely with its recordkeeper, Voya Financial, on the Be Well program. “Through an online financial wellness assessment Voya offers, employees can assess what their financial challenges are, and we can provide resources to help them,” Chicorelli says. “The assessment also provides us with aggregate data in order to plan for future programs.”

The assessment asks a series of questions about issues such as how much someone has saved for emergencies and for retirement, and how much debt that person has. “We can then help individuals prioritize their efforts,” says Lucas Lettieri, a Phoenix-based Voya Financial vice president and client relationship director who works with Akin Gump. “The assessment helps them decide, ‘Where should I put my money now, based on what my needs are?’”

Lettieri is struck by Akin Gump employees’ strong engagement with their financial wellness program: Many don’t just complete the initial Voya assessment, they also follow through on suggestions for getting the specific assistance they need. For example, nearly 50% of current and former employees now utilize Voya’s advisory program to get more in-depth help in areas such as putting together a financial plan or receiving fiduciary investment advice. “That’s twice, if not threefold, the usage we typically see with other employers,” he says.

Akin Gump also launched a student loan repayment program with SoFi in 2016, and this program is offered to lawyers at the associate level during their first year at the firm. “Employees register their loan with SoFi, and Akin Gump makes a contribution to the loan through SoFi, which sends the payment to the loan provider,” Chicorelli says, declining to disclose the contribution amount. With the SoFi refinancing program available to all employees, more than $20 million in Akin Gump employee student loans has been refinanced through the SoFi partnership, she says.

As a further measure, Akin Gump has sought ways to help its employees increase their emergency savings. In 2019, the firm added non-Roth after-tax contributions in the 401(k) as a means to establish a rainy-day savings fund. “We are now marketing that after-tax contribution as a way to save for emergencies,” Meserole says. “We’re telling employees that it’s a flexible way, through payroll deductions, to put money aside for their emergency expenses.”

—Judy Ward