After tax reform passed, many companies announced they would offer a bonus to employees—but Aflac (NYSE:AFL), the latest company to boost compensation following the passage of the tax reform bill, is taking it one step further.
Rather than just offering a one-time bonus, Aflac will boost its retirement match and offer certain hospital and accident insurance products to all employees for free.
For its U.S. workforce, effective in 2018, Aflac will increase the company's 401(k) match, from 50% to 100% on the first 4% of employee contribution and will make a one-time contribution of $500 to every employee's 401(k) plan.
Aflac also said it will increase its overall investment in the U.S. by approximately $250 million over three to five years.
"We are pleased that these tax reforms provide Aflac with an opportunity to increase our investments in initiatives that reflect our company values; providing for our employees in the long and short term, ensuring future growth for our company and giving back to the community," Aflac Chairman and CEO Dan Amos said in a statement.
Other companies that increased employee compensation following the passage of tax reform include Bank of America (NYSE:BAC) which said it will give $1,000 bonuses to more than half of its employees, while AT&T Inc. (NYSE:T) and Comcast Corp. (NYSE:CMCSA) said they would pay a $1,000 bonus to most of their workers.
The tax reform bill includes a dramatic cut to the corporate tax rate, from 35% down to 21%. Those critical of the tax reform bill have pointed out that there is no guarantee that companies will return their increased cash to employees and the U.S. economy, but the moves by companies such as Aflac and Bank of America following the tax bill’s passage suggest otherwise.