Employee Benefit Plans

6 Months Ended

Jan. 31, 2020

Retirement Benefits, Description [Abstract]

Employee Benefit Plans

Employee Benefit Plans

The Company and certain of its international subsidiaries have defined benefit pension plans for many of their hourly and salaried employees. There are two types of U.S. plans. The first type of U.S. plan (Hourly Pension Plan) is a traditional defined benefit pension plan primarily for union production employees. The second plan (Salaried Pension Plan) is for some salaried and non-union production employees, and provides defined benefits pursuant to a cash balance feature whereby a participant accumulates a benefit comprised of a percentage of current salary that varies with years of service, interest credits and transition credits. The Company no longer allows entrants into the U.S. Salaried Pension Plan and the employees no longer accrue Company contribution credits under the plan. Instead, eligible employees receive a 3% annual Company retirement contribution to their 401(k) in addition to the Company’s normal 401(k) match. The non-U.S. plans generally provide pension benefits based on years of service and compensation level. Components of net periodic benefit cost other than the service cost component are included in other income, net in the Condensed Consolidated Statements of Earnings.

Net periodic benefit costs for the Company’s pension plans include the following components (in millions):

	Three Months Ended January 31,						Six Months Ended January 31,
	2020			2019			2020			2019
Net periodic benefit costs:
Service cost	$	1.5		$	1.5		$	3.1		$	3.0
Interest cost	3.4			4.1			6.8			8.2
Expected return on assets	(6.5		)	(6.7		)	(13.0		)	(13.3		)
Prior service cost amortization	0.2			0.2			0.3			0.3
Actuarial loss amortization	1.6			1.1			3.2			2.2
Net periodic benefit costs	$	0.2		$	0.2		$	0.4		$	0.4

The Company’s general funding policy is to make at least the minimum required contributions as required by applicable regulations, plus any additional amounts that it determines to be appropriate. The estimated minimum funding requirement for the Company’s qualified U.S. plans for the plan year ending July 31, 2020 is $4.4 million.

For the six months ended January 31, 2020, the Company made required contributions of $2.5 million to its non-qualified U.S. pension plans and $0.5 million to its non-U.S. pension plans. In February 2020, the Company contributed an additional $1.1 million to the qualified U.S. pension plans.

The Company estimates it will contribute an additional $0.6 million to its non-U.S. pension plans during the remainder of fiscal 2020 based upon the local government prescribed funding requirements. Future estimates of the Company’s required pension plan contributions may change significantly depending on the actual rate of return on plan assets, discount rates and regulatory requirements.