Boeing announced that the transition, which will affect about 68,000 employees, will occur in 2016 but will not affect those now retired and receiving pension benefits.
"Our objective in making this transition is twofold: continue providing an attractive, market-leading retirement benefit contributing to employees' retirement security, while also assuring our competitiveness by curbing the unsustainable growth of our long-term pension liability," said Tony Parasida, senior vice president of Human Resources and Administration.
Beginning Jan. 1, 2016, Boeing will make cash contributions each pay period to employees' retirement savings through a new defined contribution component of the 401(k) plan. All benefits earned in the current traditional pension plan prior to the transition will be paid to employees in retirement, and the company will continue to match employee savings in an existing 401(k) plan.
Boeing said a three-year transition benefit to employees' 401(k) accounts equal to 9 percent of their eligible income in 2016, 8 percent of income in 2017 and 7 percent of income in 2018 are part of the transition.
Other features include pay-period contributions to 401(k) accounts of 3 percent to 5 percent of eligible income -- depending on age-- beginning in 2019; access to free, personal retirement counseling services for up to two years; and access to seminars and online retirement planning modeling tools.