Employee Benefit Plans

12 Months Ended

Sep. 30, 2020

Employee Benefit Plans

Defined Benefit Plans

The Company maintains multiple employee benefit plans.

Certain of the Company’s employees in the UK were participants in a Siemen’s defined benefit plan established for employees of a UK-based operation acquired by Siemens in 2004. The plan was frozen with respect to future service credits for active employees, however the benefit formula recognized future compensation increases. The Company agreed to establish a replacement defined benefit plan, with the assets of the Siemens scheme transferring to the new scheme on April 1, 2015.

The Company’s employees in Germany also participate in a defined benefit plan. Assets equaling the plan’s accumulated benefit obligation were transferred to a German defined benefit plan sponsored by the Company upon the acquisition of EWT from Siemens. The German entity also sponsors a defined benefit plan for a small group of employees located in France.

The changes in projected benefit obligations, plan assets and the funded status of the UK and German defined benefit plans as of and for the years ended September 30, 2020 and 2019, respectively, are as follows:



	2020			2019
Change in projected benefit obligation
Projected benefit obligation at prior year measurement date	$	42,948		$	35,541
Service cost	1,125			898
Interest cost	492			699
Actuarial losses	5			8,056
Benefits paid from company assets	(173		)	(139		)
Plan amendment	—			113
Foreign currency exchange impact	2,992			(2,220		)
Projected benefit obligation at measurement date	$	47,389		$	42,948
Change in plan assets
Fair value of assets at prior year measurement date	25,525			24,583
Actual return on plan assets	205			2,269
Benefits paid	(60		)	(48		)
Employer contribution	255			175
Foreign currency exchange impact	1,605			(1,454		)
Fair value of assets at measurement date	$	27,530		$	25,525
Funded status and amount recognized in assets and liabilities	$	(19,859	)	$	(17,423	)
Amount recognized in assets and liabilities
Other non‑current assets	$	2,831		$	2,655
Other non‑current liabilities	$	(22,690	)	$	(20,078	)
Amount recognized in accumulated other comprehensive loss, before taxes
Actuarial loss	$	11,235		$	11,251

The following table provides summary information for the German plan where the projected benefit obligation and accumulated benefit obligation are in excess of plan assets:



	September 30, 2020		September 30, 2019
Projected benefit obligation	$	47,389	$	42,948
Accumulated benefit obligation	$	25,489	$	22,469
Fair value of plan assets	$	27,530	$	25,525

The weighted average assumptions in the following table represent the rates used to develop the actuarial present value of the projected benefit obligation for the year indicated as well as net periodic pension cost for the following year. The discount rate is based on settling the obligation with high grade, high yield corporate bonds, and the rate of compensation increase is based upon actual experience. The expected return on assets is based on historical performance as well as expected future rates of return on plan assets considering the current investment portfolio mix and the long‑term investment strategy.



	2020	2019
Discount rate	0.80% - 1.97%	0.80% - 1.97%
Expected long‑term rate of return on plan assets	1.98% - 2.40%	0.90% - 1.98%
Salary scale	2.25% - 4.44%	2.25% - 4.44%
Pension increases	1.00% - 2.99%	1.00% - 3.38%

The Plan trustees for the UK and German pension plans have established investment policies and strategies. The UK Pension Committee established and implemented a liability driven investment approach to take advantage of, and seeking to protect, its well‑funded status. The current German investment strategy is to maintain cash reserves.

Through a trust arrangement, the German plan assets are held in cash at a German bank.

The actual overall asset allocation for the UK pension plan as compared to the investment policy goals as of September 30, 2020 was as follows by asset category:



	2020 Actual		2020 Target
Equity	23.5	%	—	%
Index‑linked gilts	76.5	%	70	%
Cash	—	%	—	%

Pension expense for the German and UK plans were as follows:



	Year Ended September 30,
	2020			2019		2018
Service cost	$	1,125		$	898	$	933
Interest cost	492			699		742
Expected return on plan assets	(387		)	(440)		(470)
Amortization of actuarial losses	1,006			371		299
Pension expense for defined benefit plans	$	2,236		$	1,528	$	1,504

The components of pension expense, other than the service cost component which is included in General and administrative expense, are included in the line item Other operating expense in the Consolidated Statements of Operations.

Benefits expected to be paid to participants of the plans are as follows:



Year Ended September 30,
2021	$	380
2022	542
2023	515
2024	613
2025	716
Five years thereafter	6,249
Total	$	9,015

Defined Contribution Plans

The Company maintains a defined contribution 401(k) plan, which covers all U.S.-based employees who meet minimum age and length of service requirements. Plan participants can elect to defer pre-tax compensation through payroll deductions. These deferrals are regulated under Section 401(k) of the Internal Revenue Code. The Company matches 100% of eligible participants’ deferrals that do not exceed 6% of their pay (subject to limitations imposed by the Internal Revenue Code). The Company’s matching contributions were $14,243, $14,533 and $12,955 for the years ended September 30, 2020, 2019 and 2018, respectively.

Employees in the UK and Germany also participate in a defined contribution plan maintained by the Company. For the years ended September 30, 2020, 2019 and 2018, contributions made to the Company’s plan in the UK and Germany were $1,021, $796 and $707, respectively.

Deferred Compensation

On April 1, 2014, the Company adopted a non-qualified deferred compensation plan for certain highly compensated employees. The Plan matches on a dollar-for-dollar basis, up to the first 6% of a participants’ pay. The Company’s obligation under the plan represents an unsecured promise to pay benefits in the future. In the event of bankruptcy or insolvency of the Company, assets of the plan would be available to satisfy the claims of general creditors. To increase the security of the participants’ deferred compensation plan benefits, the Company has established and funded a grantor trust (known as a rabbi trust). The rabbi trust is specifically designed so that assets are available to pay plan benefits to participants in the event the Company is unwilling or unable to pay the plan benefits for any reason other than bankruptcy or insolvency. As a result, the Company is prevented from withdrawing or accessing assets for corporate needs. Plan participants choose to receive a return on their account balances equal to the return on the various investment options. The rabbi trust assets are primarily invested in mutual funds and insurance contracts of which the rabbi trust is the owner and beneficiary.

Health Benefit Plan

The Company maintains a qualified employee health benefit plan in the U.S. and is self‑funded by the Company with respect to claims up to a certain amount. The plan requires contributions from eligible employees and their dependents.