Employee Retirement Benefits

3 Months Ended

Mar. 31, 2012

Employee Retirement Benefits

Employee Retirement Benefits

Note 8—Employee Retirement Benefits

The following table sets forth the net periodic pension and postretirement (including health care, life insurance and auto) expense (in millions of dollars):

	Pension Benefits
													Postretirement Benefits (U.S.)
	U.S.						Non-U.S.
	Three Months Ended March 31,
	2012			2011			2012			2011			2012		2011
Components of Net Periodic Benefit Cost:
Service cost	$	6.3		$	6.2		$	0.3		$	1.7		$	0.1	$	0.1
Interest cost		6.5			6.5			2.3			2.8			0.2		0.2
Expected return on plan assets		(7.3	)		(7.1	)		(3.0	)		(3.1	)		—		—
Net amortizations		2.8			2.0			—			(0.3	)		—		—
Settlement loss		—			0.3			—			—			—		—
Net pension/postretirement expense	$	8.3		$	7.9		$	(0.4	)	$	1.1		$	0.3	$	0.3

Our policy for funded plans is to contribute annually, at a minimum, amounts required by applicable laws, regulations and union agreements. From time to time we make contributions beyond those legally required. For the three months ended March 31, 2012 and 2011, we contributed $20.3 million and $44.8 million, respectively, to our worldwide pension plans, including discretionary contributions of $3.2 million and $12.3 million, respectively, to our United Kingdom, or "U.K.," defined benefit pension plan and benefit payments made through unfunded plans. The level of 2012 and future contributions will vary, and is dependent on a number of factors including investment returns, interest rate fluctuations, plan demographics, funding regulations and the results of the final actuarial valuation.

We have a defined benefit pension plan in the U.K. On June 30, 2011, we approved an agreement with the trustees of that plan to cease all future benefit accruals to existing members and to close the plan to new members. Effective July 1, 2011, we introduced a defined contribution plan with company matching contributions to replace the defined benefit pension plan. The company matching contributions are generally 100% of the employee contributions, up to 8% of pay, except that former members of the defined benefit plan receive an enhanced match for five years. This will result in lower contributions this year into the defined benefit plan, which will be offset by matching contributions to the new defined contribution plan. In the year ended December 31, 2011, we recognized a gain of $13.1 million for the U.K. plan that represented unamortized prior service cost from a 2010 amendment that eliminated discretionary pension increases related to pre-1997 service primarily for inactive employees.

We also sponsor postretirement health care and life insurance benefits for a limited number of employees with hire dates prior to January 1, 1990. The postretirement health care plan is contributory with participants' contributions adjusted annually. An unfunded liability is recorded. We also have a key officer postretirement car benefit plan that provides the use of a vehicle from our fleet for retired Senior Vice Presidents and above who have a minimum of 20 years of service and who retire at age 58 or above.

We participate in various "multiemployer" pension plans. In the event that we withdraw from participation in one of these plans, then applicable law could require us to make an additional lump-sum contribution to the plan, and we would have to reflect that as an expense in our consolidated statement of operations and as a liability on our condensed consolidated balance sheet. Our withdrawal liability for any multiemployer plan would depend on the extent of the plan's funding of vested benefits. At least one multiemployer plan in which we participate is reported to have, and other of our multiemployer plans could have, significant underfunded liabilities. Such underfunding may increase in the event other employers become insolvent or withdraw from the applicable plan or upon the inability or failure of withdrawing employers to pay their withdrawal liability. In addition, such underfunding may increase as a result of lower than expected returns on pension fund assets or other funding deficiencies. The occurrence of any of these events could have a material adverse effect on our consolidated financial position, results of operations or cash flows.