employee benefits are The spotlight is on this week, and it’s because of three recent stories of U.S. companies cutting non-salary compensation for workers.
A Texas tech consulting firm with a forgettable name—TTEC—suddenly became more memorable when it suspended its discretionary 401(k) match program for 16,000 employees until at least the end of 2026. According to Business Insider, which saw an internal TTEC memo, the company plans to invest in AI certification, AI tools and training, and automation, among other things.
Auditing and consulting giant Deloitte is also reportedly cutting benefits for some employees from next year. This includes reducing PTO, cutting parental leave in half and eliminating the $50,000 reimbursement for family planning services like adoption, surrogacy and IVF. San Francisco-based Zoom, meanwhile, has made a smaller-scale change, reducing parental leave for its employees from 22 weeks to 18 weeks.
So what is the driving force behind this? And are there more cuts to come? The latter is impossible to answer, and the former is unfortunately more complicated than “corporate ghouls go AI”.
First, “What Deloitte did is completely unconscionable,” says Joan C. Williams, a professor at UC Law San Francisco, author of several books on work culture and class dynamics, and a frequently cited scholar on these topics. The consulting firm is cutting benefits for a specific class of internal employees — in admin, IT support and finance — while leaving benefits intact for people in client-facing roles. The affected employee’s parental leave will be reduced from 16 weeks to just eight weeks.
“It treats people differently depending on the type of job they have and it’s absolutely strange for any mother to be cut off from eight weeks of paid leave,” Williams says. “When labor is tight, employers are more generous. But once power changes, benefits diminish.”
AI is certainly a convenient excuse for any corporate decision that harms workers these days. But here the incentive is also the cost of the benefit itself. Earlier this year, subsidies from the Affordable Care Act ended and people began dropping health care plans altogether. Insurers have cited this as a reason to increase premiums.
Sarajane Sacchetti, a former top executive at the benefits administration companies Clio and Collective Health, who is working on a new health care initiative, told me that the costs of employer-sponsored health plans have increased significantly over the past five years. A survey of more than 1,700 U.S. employers by Mercer health care consulting group last year found that health care costs per employee are expected to rise an average of 6.5 percent in 2026, the most since 2010. And this was after incorporating cost reduction measures; Otherwise, the cost of a plan will increase by about 9 percent.
“It just starts to impact how you as an employer think about total compensation,” Sacchetti says. This doesn’t mean that corporations are the ‘good guy,’ she says, but rather that the poor state of American health care policy and the lack of a safety net are responsible for much of the stress that plagues undercompensated or laid-off workers.
Williams says the US is one of the few countries that doesn’t offer federal paid maternal leave – putting it on par with Papua New Guinea and Suriname. “This shows how crazy it is to provide basic benefits like pensions and paid parental leave to workers through private employers, rather than how other industrialized countries do it,” says Williams. His proposed solution? “America needs to join the rest of the universe.”
The irony, of course, is that the US government claims to be obsessed with women having more children. If women in America – as celebrity doctor Mehmet Oz said in the Oval Office this week – were having “fewer children,” then a comprehensive paid federal leave policy would be the obvious place to start. (Oz also said that “making babies” is the most creative thing known to the universe. Don’t tell that to AI CEOs.)
