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Retirement Plans
 12 Months Ended
Oct. 31, 2020
Retirement Benefits [Abstract]  
Retirement Plans
We have a number of retirement plans covering substantially all employees. We provide both defined benefit and defined contribution plans. In general, an employee’s coverage for retirement benefits depends on the location of employment.
Defined Benefit Plan
We have a non-contributory, single employer defined benefit pension plan that covers the majority of our domestic employees, excluding the NA Cabinet Component employees who are not currently participating. On January 1, 2020 we enacted changes to our pension plan whereby the benefits for all participants were frozen and thereafter those participants will receive increased benefits in the Company sponsored defined contribution plan in lieu of participation in a defined benefit plan. Every year, the participants will receive an interest related credit on their respective balance equivalent to the prevailing 30-year Treasury rate. Of our pension plan participants, 99% have their benefit determined pursuant to the cash balance formula. For the remaining 1% of participants, the benefit formula is a traditional formula for retirement benefits, whereby the plan pays benefits to employees upon retirement, using a formula which considers years of service and pensionable compensation prior to retirement.
As a result of this action, we remeasured the pension assets and obligations for the pension plan, which resulted in a decrease to our projected benefit obligation and a corresponding net actuarial gain that was recorded in accumulated other comprehensive income (loss). This remeasurement is included in the tables below, which reflect the full impact of pension plan results and accounting measurements for the year ended October 31, 2020.
The Medicare Prescription Drug, Improvement and Modernization Act of 2003 was signed into law on December 8, 2003. This Act introduces a Medicare prescription-drug benefit beginning in 2006 as well as a federal subsidy to sponsors of retiree health care plans that provide a benefit at least “actuarially equivalent” to the Medicare benefit. We concluded that our plans are at least “actuarially equivalent” to the Medicare benefit. For those who are otherwise eligible for the subsidy, we have not included this subsidy per the Act in our benefit calculations. The impact to net periodic benefit cost and to benefits paid did not have a material impact on the consolidated financial statements.
Funded Status and Net periodic Benefit Cost
The changes in benefit obligation and plan assets, and our funded status (reported in deferred pension and postretirement benefits on the consolidated balance sheets) were as follows (in thousands):
 October 31,
Change in Benefit Obligation:20202019
Beginning balance as of November 1, 2019 and 2018, respectively$44,323 $35,959 
Service cost1,262 3,629 
Interest cost1,139 1,456 
Actuarial loss2,823 7,690 
Benefits paid(712)(3,581)
Administrative expenses(785)(830)
Curtailments(1,141)— 
Settlements(2,084)— 
Projected benefit obligation at October 31,$44,825 $44,323 
Change in Plan Assets:
Beginning balance as of November 1, 2019 and 2018, respectively$31,212 $32,064 
Actual return on plan assets2,789 2,869 
Employer contributions3,700 690 
Benefits paid(712)(3,581)
Administrative expenses(785)(830)
Settlements(2,084)— 
Fair value of plan assets at October 31,$34,120 $31,212 
Noncurrent liability - Funded Status$(10,705)$(13,111)
As of October 31, 2020 and 2019, included in our accumulated comprehensive loss was a net actuarial loss of $9.9 million and $6.7 million, respectively. There were no net prior service costs or transition obligations for the years ended October 31, 2020 and 2019.
As of October 31, 2020 and 2019, the accumulated benefit obligation was $44.8 million and $43.3 million, respectively. The accumulated benefit obligation is the present value of pension benefits (whether vested or unvested) attributed to employee service rendered before the measurement date, and based on employee service and compensation prior to that date. The accumulated benefit obligation differs from the projected benefit obligation in that it includes no assumption about future compensation levels.
The net periodic benefit cost for the years ended October 31, 2020, 2019 and 2018, was as follows (in thousands):
 Year Ended October 31,
 202020192018
Service cost$1,262 $3,629 $3,908 
Interest cost1,139 1,456 1,130 
Expected return on plan assets(2,006)(1,977)(2,172)
Amortization of net loss162 125 64 
Settlements462 — — 
Net periodic benefit cost$1,019 $3,233 $2,930 
The changes in plan assets and projected benefit obligations which were recognized in our other comprehensive loss for the years ended October 31, 2020, 2019 and 2018 were as follows (in thousands):
 Year Ended October 31,
 202020192018
Net loss (gain) arising during the period$2,141 $6,697 $(2,189)
Less: Amortization of net loss162 125 64 
Less: Curtailments1,141 — — 
Less: Settlements462 — — 
Total recognized in other comprehensive loss$376 $6,572 $(2,253)
Measurement Date and Assumptions
We generally determine our actuarial assumptions on an annual basis, with a measurement date of October 31. The following table presents our assumptions for pension benefit calculations for the years ended October 31, 2020, 2019 and 2018:
For the Year Ended October 31,
202020192018202020192018
Weighted Average Assumptions:Benefit ObligationNet Periodic Benefit Cost
Discount rate3.22%3.10%4.44%3.10%4.44%3.68%
Rate of compensation increase—%3.00%3.00%—%3.00%3.00%
Expected return on plan assetsn/an/an/a6.50%6.50%6.50%
The discount rate was used to calculate the present value of the projected benefit obligation for pension benefits. The rate reflects the amount at which benefits could be effectively settled on the measurement date. We used a RATE: Link Model whereby target yields are developed from bonds across a range of maturity points, and a curve is fitted to those targets. Spot rates (zero coupon bond yields) are developed from the curve and used to discount benefit payments associated with each future year. This model assumes spot rates will remain level beyond the 30-year point. We determine the present value of plan benefits by applying the discount rates to projected benefit cash flows.
The expected return on plan assets was used to determine net periodic pension expense. The rate of return assumptions were based on projected long-term market returns for the various asset classes in which the plans were invested, weighted by the target asset allocations. We review the return assumption at least annually. The rate of compensation increase represents the long-term assumption for expected increases in salaries.
Plan Assets
The following tables provide our target allocation for the year ended October 31, 2020, as well as the actual asset allocation by asset category and fair value measurements as of October 31, 2020 and 2019:
 
Target AllocationActual Allocation
 October 31, 2020October 31, 2020October 31, 2019
Equity securities60.0 %60.0 %61.0 %
Fixed income40.0 %40.0 %39.0 %
Fair Value Measurements at
 October 31, 2020October 31, 2019
 (In thousands)
Money market fund$3,532 $574 
Large capitalization7,954 8,092 
Small capitalization2,407 2,489 
International equity6,130 6,219 
Other1,853 1,848 
Equity securities$18,344 $18,648 
High-quality core bond9,743 9,525 
High-quality government bond1,249 1,228 
High-yield bond1,252 1,237 
Fixed income$12,244 $11,990 
Total securities(1)
$34,120 $31,212 
(1)Quoted prices in active markets for identical assets (Level 1).
Inputs and valuation techniques used to measure the fair value of plan assets vary according to the type of security being valued. All of the equity and debt securities held directly by the plans were actively traded and fair values were determined based on quoted market prices.
Our investment objective for defined benefit plan assets is to meet the plans’ benefit obligations, while minimizing the potential for future required plan contributions. The investment strategies focus on asset class diversification, liquidity to meet benefit payments and an appropriate balance of long-term investment return and risk. Target ranges for asset allocations are determined by matching the actuarial projections of the plans’ future liabilities and benefit payments with expected long-term rates of return on the assets, taking into account investment return volatility and correlations across asset classes. Plan assets are diversified across several investment managers and are generally invested in liquid funds that are selected to track broad market equity and bond indices. Investment risk is carefully controlled with plan assets rebalanced to target allocations on a periodic basis and monitoring of performance of investment managers relative to the investment guidelines established with each investment manager.
Expected Benefit Payments and Funding
Our pension funding policy is to make the minimum annual contributions required pursuant to the plan. We accelerated contributions to target a 100% funding threshold. Additionally, we consider funding annual requirements early in the fiscal year to potentially maximize the return on assets. For the fiscal years ended October 31, 2020, 2019 and 2018, we made total pension contributions of $3.7 million, $0.7 million and $0.8 million, respectively.

During fiscal 2021, we expect to contribute approximately $0.5 million to the pension plan to reach targeted funding levels and meet minimum contribution requirements. This expected contribution level will be dependent on many variables, including the market value of the assets compared to the obligation, as well as other market or regulatory conditions. In addition, we consider the cash requirements of our business investment opportunities. Accordingly, actual funding amounts and the timing of such funding may differ from current estimates.
The following table presents the total benefit payments expected to be paid to participants by year, which includes payments funded from our assets, as well as payments paid from the plan for the year ended October 31, (in thousands):
 Pension Benefits
2021$3,036 
20222,583 
20232,404 
20242,376 
20252,394 
2026 - 203010,910 
Total$23,703 

Defined Contribution Plan
We also sponsor two defined contribution plans into which we and our employees make contributions. As of January 1, 2020, we match 100% up to the first 5% of employee annual salary deferrals under our plan for all employees excluding NA Cabinet Components participants, who receive a 100% match up to 4% of employee annual salary deferrals. Between January 1, 2018 and January 1, 2020, we matched 50% up to the first 5% of employee salary deferrals. We do not offer our common stock as a direct investment option under these plans. For the years ended October 31, 2020, 2019 and 2018, we contributed approximately $4.8 million, $2.7 million and $2.6 million for these plans, respectively.
Other Plans
Under our postretirement benefit plan, we provide certain healthcare and life insurance benefits for a small number of eligible retired employees who were employed prior to January 1, 1993. Certain employees may become eligible for those benefits if they reach normal retirement age while working for us. We continue to fund benefit costs on a pay-as-you-go basis.
The table below indicates the amount of these liabilities included in the accompanying consolidated balance sheets:
 October 31, 2020October 31, 2019
 (In thousands)
Accrued liabilities$49 $49 
Deferred pension and postretirement benefits218 311 
Total$267 $360 
We also have supplemental benefit plans covering certain executive officers and a non-qualified deferred compensation plan covering members of the Board of Directors and certain key employees. Our liability under the supplemental benefit plan was approximately $2.6 million and $4.2 million as of October 31, 2020 and 2019, and our liability under the deferred compensation plan was approximately $3.3 million and $3.8 million, respectively. As of October 31, 2020 and 2019, the current portion of these liabilities was recorded under the caption "Accrued Liabilities," and the long-term portion was included under the caption "Other Liabilities" in the accompanying balance sheets.