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Distressed by baby controversy, AOL’s Armstrong reverses 401(K) policy

Tim Armstrong, chief executive officer of AOL.
Pete Marovich | Bloomberg | Getty Images
Tim Armstrong, chief executive officer of AOL.

In a letter to employees, AOL CEO Tim Armstrong reversed the company's recent decision to change some 401(k) benefits. The move had caused controversy inside the company, especially after Armstrong made a mess of an already tense situation with staffers by rationalizing the cuts because of higher healthcare costs.

Worse still, he used the example of two "distressed babies" of employees — claiming each cost $1 million to care for — as one of those expenses.

Read the whole story--and Armstrong's memo in full--at Re/code.

By Kara Swisher, recode.net.

CNBC's parent NBC Universal is an investor in re/code's parent Revere Digital, and the companies have a content-sharing arrangement.

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