Retirement Plans

9 Months Ended

Jun. 30, 2022

Retirement Plans [Abstract]

Retirement Plans

Note 4. Retirement Plans

We have defined benefit pension plans and other postretirement benefit plans for certain U.S. and non-U.S. employees. Certain plans were frozen for salaried and non-union hourly employees at various times in the past, and nearly all of our remaining salaried and non-union hourly employees accruing benefits ceased accruing benefits as of December 31, 2020. In addition, we participate in several multiemployer pension plans (“MEPP” or “MEPPs”) that provide retirement benefits to certain union employees in accordance with various collective bargaining

agreements and have participated in other MEPPs in the past. We also have supplemental executive retirement plans and other non-qualified defined benefit pension plans that provide unfunded supplemental retirement benefits to certain of our current and former executives.

MEPPs

In the normal course of business, we evaluate our potential exposure to MEPPs, including with respect to potential withdrawal liabilities. In fiscal 2018, we submitted formal notification to withdraw from the Pace Industry Union-Management Pension Fund (“PIUMPF”) and the Central States, Southeast and Southwest Areas Pension Plan (“Central States”), and recorded estimated withdrawal liabilities for each. The PIUMPF estimated withdrawal liability assumed both a payment for withdrawal liability and for our proportionate share of PIUMPF’s accumulated funding deficiency. The estimated withdrawal liability excludes the potential impact of a future mass withdrawal of other employers from PIUMPF, which was not considered probable or reasonably estimable and was discounted at a credit adjusted risk free rate. Subsequently, we continued to refine the estimate of the withdrawal liability, the impact of which was not significant. It is reasonably possible that we may incur withdrawal liabilities with respect to certain other MEPPs in connection with such withdrawals. Our estimate of any such withdrawal liability, both individually and in the aggregate, is not material for the remaining plans in which we participate.

In September 2019, we received a demand from PIUMPF asserting that we owe $170.3 million on an undiscounted basis (approximately $0.7 million per month for the next 20 years) with respect to our withdrawal liability. The initial demand did not address any assertion of liability for PIUMPF’s accumulated funding deficiency. In October 2019, we received two additional demand letters from PIUMPF related to a subsidiary of ours asserting that we owe $2.3 million on an undiscounted basis to be paid over 20 years with respect to the subsidiary’s withdrawal liability and $2.0 million for its accumulated funding deficiency. We received an updated demand letter decreasing the accumulated funding deficiency demand from $2.0 million to $1.3 million in April 2020. In February 2020, we received a demand letter from PIUMPF asserting that we owe $51.2 million for our pro-rata share of PIUMPF’s accumulated funding deficiency, including interest. We dispute the PIUMPF accumulated funding deficiency demands. We began making monthly payments (approximately $0.7 million per month for 20 years) for these withdrawal liabilities in fiscal 2020, excluding the accumulated funding deficiency demands.

In July 2021, PIUMPF filed suit against us in the U.S. District Court for the Northern District of Georgia claiming the right to recover our pro rata share of the pension fund’s accumulated funding deficiency. We believe we are adequately reserved for this matter.

At June 30, 2022 and September 30, 2021, we had recorded withdrawal liabilities of $219.6 million and $247.1 million, respectively, including liabilities associated with PIUMPF's accumulated funding deficiency demands. The decrease in withdrawal liabilities in fiscal 2022 as compared to the end of fiscal 2021 was primarily due to an increase in interest rates.

See “Note 5. Retirement Plans,” and the subsection “Multiemployer Plans” in that Note, of the Notes to Consolidated Financial Statements in the Fiscal 2021 Form 10-K for more information regarding our involvement with retirement plans and involvement with MEPPs.

Pension and Postretirement Income / Expense

The following table presents a summary of the components of net pension income (in millions):

	Three Months Ended						Nine Months Ended
	June 30,						June 30,
	2022			2021			2022			2021
Service cost	$	10.7		$	11.2		$	35.9		$	38.3
Interest cost		46.9			47.3			141.6			140.4
Expected return on plan assets		(92.0	)		(92.0	)		(277.0	)		(276.0	)
Amortization of net actuarial loss		2.3			9.8			6.7			25.7
Amortization of prior service cost		2.1			2.3			6.3			6.3
Settlement loss		—			—			0.2			—
Company defined benefit plan income		(30.0	)		(21.4	)		(86.3	)		(65.3	)
Multiemployer and other plans		0.4			0.4			1.1			1.2
Net pension income	$	(29.6	)	$	(21.0	)	$	(85.2	)	$	(64.1	)

The non-service elements of our pension and postretirement costs set forth in this Note 4 are reflected in the condensed consolidated statements of income line item “Pension and other postretirement non-service income”. The service cost components are reflected in “Cost of goods sold” and “Selling, general and administrative, excluding intangible amortization” line items.

We maintain other postretirement benefit plans that provide certain health care and life insurance benefits for certain salaried and hourly employees who meet specified age and service requirements as defined by the plans. The following table presents a summary of the components of the net postretirement cost (in millions):

	Three Months Ended						Nine Months Ended
	June 30,						June 30,
	2022			2021			2022			2021
Service cost	$	0.3		$	0.2		$	0.8		$	0.8
Interest cost		1.7			1.5			4.8			4.4
Amortization of net actuarial loss (gain)		0.4			0.2			(0.4	)		(0.4	)
Amortization of prior service credit		(0.1	)		(0.6	)		(0.5	)		(1.8	)
Net postretirement cost	$	2.3		$	1.3		$	4.7		$	3.0

Employer Contributions

During the three and nine months ended June 30, 2022, we made contributions to our qualified and supplemental defined benefit pension plans of $4.8 million and $15.1 million, respectively, and for the three and nine months ended June 30, 2021 we made contributions of $4.8 million and $15.6 million, respectively.

During the three and nine months ended June 30, 2022, we funded an aggregate of $2.0 million and $5.1 million, respectively, to our other postretirement benefit plans and for the three and nine months ended June 30, 2021 we funded an aggregate of $1.6 million and $4.7 million, respectively.