The Pension Revolt

Boomers are challenging a new cash-balance plan

When Lou Gerstner, IBM's iron-willed CEO, makes a decision, he usually sticks by it. So how was it that 10 days ago he made an abrupt about-face, scaling back a change to the company's retirement plan that was supposed to save $200 million annually? And did Gerstner realize he was feeding a nationwide workplace riot among baby boomers, who are convinced their nest eggs are being plundered?

Granted, as TIME reported last April, numerous FORTUNE 500 firms, from Xerox to Kodak, have already made the big pension switch--moving millions of employees from the traditional system, which rewards longevity and piles up...

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