AOL Reverses Changes To Retirement Plan

(RTTNews) - AOL chief executive Tim Armstrong reportedly said in an e-mail to employees on Saturday that the company's 401(k) policy would be reversed to the original form. He also apologized for comments made last week that turned out to be controversial.

He said in the mail that the company's retirement policy would be brought back to a per-pay-period matching contribution rather than an annual lump sum that was suggested. Such a move would have affected employees who left during the year.

Armstrong last week linked the company's rising health care costs to two women employees with "distressed babies." The employees had "distressed babies that were born," which cost AOL $1 million each.

The mother of one of the babies whom Armstrong had indicated wrote an article describing her daughter's premature birth and the testing times.

Later, Armstrong also blamed President Barack Obama's health-care law for forcing cutbacks, adding that Obamacare added $7.1 million in expenses for AOL.

"On a personal note, I made a mistake and I apologize for my comments last week at the town hall when I mentioned specific health-care examples in trying to explain our decision making process around our employee benefit programs," Armstrong wrote in the mail.

AOL closed up 0.3 percent on Friday at $47.28 and slid 1.2 percent in the extended trade.