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Retirement Plans
9 Months Ended
Jun. 30, 2020
Retirement Plans [Abstract]  
Retirement Plans

Note 5.

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, although some employees meeting certain criteria are still accruing benefits. 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. 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. See “Note 5. Retirement Plans” and “Note 5. Retirement Plans — Multiemployer Plans” of the Notes to Consolidated Financial Statements section in the Fiscal 2019 Form 10-K for more information regarding our involvement with retirement plans and involvement with MEPPs.

MEPPs

 

In the normal course of business, we evaluate our potential exposure to MEPPs, including with respect to potential withdrawal liabilities. During 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, and recorded estimated withdrawal liabilities for each. 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. 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 are evaluating each of these demands and we expect to challenge the accumulated funding deficiency demands. We began making monthly payments for these withdrawal liabilities in fiscal 2020.

 

We have also made other immaterial adjustments from time to time to our various other withdrawal liabilities. At June 30, 2020 and September 30, 2019, we had withdrawal liabilities recorded of $237.7 million and $237.2 million, respectively.

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,

 

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

Service cost

 

$

11.9

 

 

$

10.2

 

 

$

39.2

 

 

$

32.5

 

Interest cost

 

 

49.7

 

 

 

58.8

 

 

 

149.1

 

 

 

174.0

 

Expected return on plan assets

 

 

(90.1

)

 

 

(85.9

)

 

 

(271.7

)

 

 

(254.7

)

Amortization of net actuarial loss

 

 

11.4

 

 

 

6.3

 

 

 

35.1

 

 

 

18.7

 

Amortization of prior service cost

 

 

1.9

 

 

 

1.3

 

 

 

5.4

 

 

 

3.9

 

Curtailment loss

 

 

 

 

 

0.1

 

 

 

0.4

 

 

 

1.0

 

Company defined benefit plan income

 

 

(15.2

)

 

 

(9.2

)

 

 

(42.5

)

 

 

(24.6

)

Multiemployer pension withdrawal income

 

 

(2.0

)

 

 

(1.7

)

 

 

(1.1

)

 

 

(1.7

)

Multiemployer and other plans

 

 

0.3

 

 

 

0.2

 

 

 

1.0

 

 

 

0.5

 

Net pension income

 

$

(16.9

)

 

$

(10.7

)

 

$

(42.6

)

 

$

(25.8

)

 

The non-service elements of our pension and postretirement costs set forth in this Note 5. Retirement Plans 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,

 

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

Service cost

 

$

0.3

 

 

$

0.2

 

 

$

1.0

 

 

$

0.8

 

Interest cost

 

 

1.7

 

 

 

1.9

 

 

 

5.3

 

 

 

5.8

 

Amortization of net actuarial loss (gain)

 

 

0.5

 

 

 

(0.7

)

 

 

0.1

 

 

 

(1.5

)

Amortization of prior service credit

 

 

(0.7

)

 

 

(0.7

)

 

 

(2.1

)

 

 

(2.1

)

Net postretirement cost

 

$

1.8

 

 

$

0.7

 

 

$

4.3

 

 

$

3.0

 

 

 

Employer Contributions

 

During the three and nine months ended June 30, 2020, we made contributions to our qualified and supplemental defined benefit pension plans of $4.6 million and $17.2 million, respectively, and for the three and nine months ended June 30, 2019, we made contributions of $6.6 million and $16.1 million, respectively.

 

During the three and nine months ended June 30, 2020, we funded an aggregate of $1.6 million and $5.3 million, respectively, and for the three and nine months ended June 30, 2019, we funded an aggregate of $2.2 million and $6.6 million, respectively, to our other postretirement benefit plans.