Pension Benefits

6 Months Ended

Jun. 27, 2020

Pension Benefits

Pension Benefits

(10) Pension Benefits

Company-Sponsored Defined Benefit Pension Plans. As of June 27, 2020, we had four company-sponsored defined benefit pension plans. The benefits are based on years of service and the employee’s compensation, as defined in the plans. Effective January 1, 2020, newly hired non-union employees are no longer eligible to participate in our defined benefit pension plans. Net periodic pension cost for our four company-sponsored defined benefit pension plans for the second quarter and first two quarters of 2020 and 2019 includes the following components (in thousands):

	Thirteen Weeks Ended				Twenty-six Weeks Ended
	June 27,		June 29,		June 27,		June 29,
	2020		2019		2020		2019
Service cost—benefits earned during the period	$	2,052	$	1,734	$	4,519	$	3,671
Interest cost on projected benefit obligation		1,322		1,431		2,699		2,873
Expected return on plan assets		(2,319)		(1,913)		(4,548)		(3,827)
Amortization of unrecognized loss		296		215		696		430
Net periodic pension cost	$	1,351	$	1,467	$	3,366	$	3,147

During the second quarter of 2020, we made an $8.0 million contribution to our company-sponsored defined benefit pension plans. During the first quarter of 2020 and the first two quarters of 2019, we did not make any contributions to our company-sponsored defined benefit pension plans.

Multi-Employer Defined Benefit Pension Plan. We also contribute to the Bakery and Confectionery Union and Industry International Pension Fund (EIN 52-6118572, Plan No. 001), a multi-employer defined benefit pension plan, sponsored by the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union (BCTGM) on behalf of certain employees at our Portland, Maine manufacturing facility. The plan provides multiple plan benefits with corresponding contribution rates that are collectively bargained between participating employers and their affiliated BCTGM local unions.

We were notified that for the plan year beginning January 1, 2012, the plan was in critical status and classified in the Red Zone, and for the plan year beginning January 1, 2018, the plan was in critical and declining status. As of the date of the accompanying unaudited consolidated interim financial statements, the plan remains in critical and declining status. The law requires that all contributing employers pay to the plan a surcharge to help correct the plan’s financial situation. The amount of the surcharge is equal to a percentage of the amount an employer is otherwise required to contribute to the plan under the applicable collective bargaining agreement. During the second quarter of 2015, we agreed to a collective bargaining agreement that, among other things, implements a rehabilitation plan. As a result, our contributions to the plan are expected to increase by at least 5.0% per year, assuming consistent hours are worked.

B&G Foods made contributions to the multi-employer defined benefit pension plan of $0.4 million during the first two quarters of 2020 and $0.5 million during the first two quarters of 2019, respectively. These contributions represented less than five percent of total contributions made to the plan.