"AOL Chairman and CEO Tim Armstrong has been credited with making the flagging tech company prosperous again, but his employee-relations could use some work. Last year he created a public relations disaster when he fired one of his employees on a conference call with over 1,000 of the poor guy’s co-workers. Making matters worse, the conference call was supposed to be a morale booster after AOL announced plans to lay off a bunch of their employees.
It was during another conference call (Armstrong has a lot of conference calls and he’s really, really bad at them) on Thursday that Armstrong managed to yet again stun his employees. While going over changes to employee retirement plans, Armstrong explained that he had no choice but to cut every employee’s 401k benefits because Obamacare has increased his costs by $7.1 million (more on this in a minute). But things took a turn for the weird when he started talking about how AOL paid for two employees’ babies’ medical bills:
“We had two AOL-ers that had distressed babies that were born that we paid a million dollars each to make sure those babies were OK in general,” Armstrong said. “And those are the things that add up into our benefits cost. So when we had the final decision about what benefits to cut because of the increased healthcare costs, we made the decision, and I made the decision, to basically change the 401(k) plan.”
From the statement, it seems as though Armstrong is blaming the 401k modifications on the fact that AOL had to cover the costs of two employees whose babies he just publicly outed as being “distressed.” It’s unclear if that is how Armstrong meant it, but that is the way his employees took it. According to sources cited in a Business Insider story on the debacle, Armstrong had meant to portray AOL as a company that takes care of its employees, using the two sick babies as an example of that. You can decide whether that was the case or not."