Employee Benefit Plans

12 Months Ended

Jan. 02, 2022

Retirement Benefits [Abstract]

Employee Benefit Plans

Employee Benefit Plans

 Savings Plan:    The Company has a 401(k) Savings Plan for the benefit of all qualified U.S. employees, with such employees receiving matching contributions in the amount equal to 100.0% of the first 5.0% of eligible compensation up to applicable Internal Revenue Service limits. Savings plan expense was $16.5 million in fiscal year 2021, $14.1 million in fiscal year 2020, and $13.6 million in fiscal year 2019.

Pension Plans:    The Company has a defined benefit pension plan covering certain U.S. employees and non-U.S. pension plans for certain non-U.S. employees. The principal U.S. defined benefit pension plan was closed to new hires effective January 31, 2001, and benefits for those employed by the Company’s former Life Sciences business were frozen as of that date. Plan benefits were frozen as of March 2003 for those employed by the Company’s former Analytical Instruments business and corporate employees. Plan benefits were frozen as of January 31, 2011 for all remaining employees that were still actively

accruing in the plan. The plans provide benefits that are based on an employee’s years of service and compensation near retirement.

 Net periodic pension cost for U.S. and non-U.S. plans included the following components for fiscal years ended:

	January 2, 2022		January 3, 2021		December 29, 2019
	(In thousands)
Service and administrative costs	$	5,174	$	7,414	$	6,598
Interest cost	9,440		12,876		16,546
Expected return on plan assets	(24,417)		(21,786)		(24,561)
Actuarial (gain) loss	(19,514)		20,291		27,134
Curtailment gain	—		—		(1,547)
Amortization of prior service credit	—		—		(152)
Net periodic pension (credit) cost	$	(29,317)	$	18,795	$	24,018

The Company recognizes actuarial gains and losses, unless an interim remeasurement is required, in the fourth quarter of the year in which the gains and losses occur. Such adjustments for gains and losses are primarily driven by events and circumstances beyond the Company's control, including changes in interest rates, the performance of the financial markets and mortality assumptions. Actuarial gains and losses, including other components of periodic pension cost, are recognized in the line item "Interest and other expense, net" in the consolidated statements of operations.

The following table sets forth the changes in the funded status of the principal U.S. pension plan and the principal non-U.S. pension plans and the amounts recognized in the Company’s consolidated balance sheets as of January 2, 2022 and January 3, 2021.

	January 2, 2022						January 3, 2021
	Non-U.S.			U.S.			Non-U.S.			U.S.
	(In thousands)
Actuarial present value of benefit obligations:
Accumulated benefit obligations	$	337,454		$	299,826		$	392,948		$	317,679
Change in benefit obligations:
Projected benefit obligations at beginning of year	$	395,339		$	317,679		$	341,455		$	304,710
Service and administrative costs	4,924			250			5,314			2,100
Interest cost	2,632			6,808			3,991			8,885
Benefits paid and plan expenses	(15,299)			(18,693)			(15,823)			(20,510)
Participants’ contributions	—			—			37			—
Business acquisitions	—			—			(120)			—
Actuarial (gains) losses	(30,705)			(6,218)			35,910			22,494
Effect of exchange rate changes	(17,501)			—			24,575			—
Projected benefit obligations at end of year	$	339,390		$	299,826		$	395,339		$	317,679
Change in plan assets:
Fair value of plan assets at beginning of year	$	204,744		$	268,686		$	179,860		$	254,450
Actual return on plan assets	(13,115)			20,123			25,153			34,746
Benefits paid and plan expenses	(15,299)			(18,693)			(15,823)			(20,510)
Employer’s contributions	6,851			20,000			7,506			—
Participants’ contributions	—			—			37			—
Effect of exchange rate changes	(1,992)			—			8,011			—
Fair value of plan assets at end of year	$	181,189		$	290,116		$	204,744		$	268,686
Net liabilities recognized in the consolidated balance sheets	$	(158,201)		$	(9,710)		$	(190,595)		$	(48,993)
Net amounts recognized in the consolidated balance sheets consist of:
Other assets	$	33,084		$	—		$	36,295		$	—
Current liabilities	(6,966)			—			(7,597)			—
Long-term liabilities	(184,319)			(9,710)			(219,293)			(48,993)
Net liabilities recognized in the consolidated balance sheets	$	(158,201)		$	(9,710)		$	(190,595)		$	(48,993)
Actuarial assumptions as of the year-end measurement date:
Discount rate	1.41		%	2.44		%	0.92		%	2.21		%
Rate of compensation increase	2.78		%	None			2.78		%	None

Actuarial assumptions used to determine net periodic pension cost during the year were as follows:

	January 2, 2022				January 3, 2021				December 29, 2019
	Non-U.S.		U.S.		Non-U.S.		U.S.		Non-U.S.		U.S.
Discount rate	0.92	%	2.21	%	1.34	%	3.01	%	2.07	%	4.05	%
Rate of compensation increase	2.78	%	None		3.36	%	None		3.48	%	None
Expected rate of return on assets	2.10	%	7.25	%	2.20	%	7.25	%	5.30	%	7.25	%

The following table provides a breakdown of the non-U.S. benefit obligations and fair value of assets for pension plans that have benefit obligations in excess of plan assets:

	January 2, 2022		January 3, 2021
	(In thousands)
Pension Plans with Projected Benefit Obligations in Excess of Plan Assets
Projected benefit obligations	$	191,285	$	226,890
Fair value of plan assets	—		—
Pension Plans with Accumulated Benefit Obligations in Excess of Plan Assets
Accumulated benefit obligations	$	189,349	$	224,499
Fair value of plan assets	—		—

 Assets of the defined benefit pension plans are primarily equity and debt securities. Asset allocations as of January 2, 2022 and January 3, 2021, and target asset allocations for fiscal year 2022 are as follows:

	Target Allocation				Percentage of Plan Assets at
	January 1, 2023				January 2, 2022				January 3, 2021
Asset Category	Non-U.S.		U.S.		Non-U.S.		U.S.		Non-U.S.		U.S.
Equity securities	0-5%		40-60%		—	%	46	%	—	%	45	%
Debt securities	0-5%		40-60%		—	%	54	%	88	%	55	%
Other	95-100%		0-10%		100	%	—	%	12	%	—	%
Total	100	%	100	%	100	%	100	%	100	%	100	%

The Company maintains target allocation percentages among various asset classes based on investment policies established for the pension plans which are designed to maximize the total rate of return (income and appreciation) after inflation within the limits of prudent risk taking, while providing for adequate near-term liquidity for benefit payments.

The Company’s expected rate of return on assets assumptions are derived from management’s estimates, as well as other information compiled by management, including studies that utilize customary procedures and techniques. The studies include a review of anticipated future long-term performance of individual asset classes and consideration of the appropriate asset allocation strategy given the anticipated requirements of the plans to determine the average rate of earnings expected on the funds invested to provide for the pension plans benefits. While the study gives appropriate consideration to recent fund performance and historical returns, the assumption is primarily a long-term, prospective rate.

The Company's discount rate assumptions are derived from a range of factors, including a yield curve for certain plans, composed of the rates of return on high-quality fixed-income corporate bonds available at the measurement date and the related expected duration for the obligations, and a bond matching approach for certain plans.

The target allocations for plan assets are listed in the above table. Equity securities primarily include investments in large-cap and mid-cap companies located in the United States and abroad, and equity index funds. Debt securities include corporate bonds of companies from diversified industries, high-yield bonds, and U.S. government securities. Other types of investments include investments in non-U.S. government index linked bonds, multi-strategy hedge funds and venture capital funds that follow several different strategies.

The fair value of the Company’s pension plan assets as of January 2, 2022 and January 3, 2021 by asset category, classified in the three levels of inputs described in Note 20 to the consolidated financial statements are as follows:

			Fair Value Measurements at January 2, 2022 Using:
	Total Carrying Value at January 2, 2022		Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable  Inputs (Level 3)
	(In thousands)
Cash	$	22,241	$	22,241	$	—	$	—
Equity securities:
U.S. large-cap	91,601		91,601		—		—
International large-cap value	29,803		29,803		—		—
Emerging markets growth	12,603		12,603		—		—
Foreign real estate funds	—		—		—		—
Fixed income securities:
Corporate and U.S. debt instruments	133,727		41,725		92,002		—
Short-term corporate bonds	15,650		—		15,650		—
Other types of investments:
Foreign liability driven instrument	165,680		—		—		165,680
Total assets measured at fair value	$	471,305	$	197,973	$	107,652	$	165,680

			Fair Value Measurements at January 3, 2021 Using:
	Total Carrying Value at January 3, 2021		Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable  Inputs (Level 3)
	(In thousands)
Cash	$	6,363	$	6,363	$	—	$	—
Equity Securities:
U.S. large-cap	78,234		78,234		—		—
International large-cap value	28,315		28,315		—		—
Emerging markets growth	13,594		13,594		—		—
Foreign real estate funds	23,259		—		—		23,259
Fixed income securities:
Non-U.S. Treasury Securities	106,315		—		106,315		—
Corporate and U.S. debt instruments	140,349		43,500		96,849		—
Corporate bonds	35,816		—		35,816		—
High yield bond funds	2,954		2,954		—		—
Other types of investments:
Non-U.S. government index linked bonds	38,231		—		38,231		—
Total assets measured at fair value	$	473,430	$	172,960	$	277,211	$	23,259

Valuation Techniques:    Valuation techniques utilized need to maximize the use of observable inputs and minimize the use of unobservable inputs. There have been no changes in the methodologies utilized at January 2, 2022 compared to January 3, 2021. The following is a description of the valuation techniques utilized to measure the fair value of the assets shown in the table above.

Equity Securities:    Shares of registered investment companies that are publicly traded are categorized as Level 1 assets; they are valued at quoted market prices that represent the net asset value of the fund. These instruments have active markets.

Equity index funds are mutual funds that are not publicly traded and are comprised primarily of underlying equity securities that are publicly traded on exchanges. Price quotes for the assets held by these funds are readily observable and available. Equity index funds are categorized as Level 2 assets.

Fixed Income Securities:    Fixed income mutual funds that are publicly traded are valued at quoted market prices that represent the net asset value of securities held by the fund and are categorized as Level 1 assets.

Fixed income index funds that are not publicly traded are stated at net asset value as determined by the issuer of the fund based on the fair value of the underlying investments and are categorized as Level 2 assets.

Individual fixed income bonds are categorized as Level 2 assets except where sufficient quoted prices exist in active markets, in which case such securities are categorized as Level 1 assets. These securities are valued using third-party pricing services. These services may use, for example, model-based pricing methods that utilize observable market data as inputs. Broker dealer bids or quotes of securities with similar characteristics may also be used.

Other Types of Investments:    Non-U.S. government index link bond funds are not publicly traded and are stated at net asset value as determined by the issuer of the fund based on the fair value of the underlying investments. Underlying investments consist of bonds in which payment of income on the principal is related to a specific price index and are categorized as Level 2 assets.

Hedge funds, private equity funds, foreign real estate funds and venture capital funds are valued at fair value by using the net asset values provided by the investment managers and are updated, if necessary, using analytical procedures, appraisals, public market data and/or inquiry of the investment managers. The net asset values are determined based upon the fair values of the underlying investments in the funds. These other investments invest primarily in readily available marketable securities and allocate gains, losses, and expense to the investor based on the ownership percentage as described in the fund agreements. They are categorized as Level 3 assets.

In September 2021, the Company’s UK pension scheme executed a buy-in contract with Phoenix Life LTD (''Phoenix"), under which the Company made an upfront payment to Phoenix in exchange for Phoenix agreeing to make the benefit payments under the Company’s UK pension scheme due to specified participants and their beneficiaries, thus transferring most of the investment and longevity risk associated with the covered participants and beneficiaries from the Company to Phoenix. This buy-in contract can be considered a liability-driven investment (''LDI") solution that hedges not only the investment risk but also the longevity risk under the Company’s UK pension scheme. Like other LDI solutions, it does not eliminate ongoing administrative costs.

The Company's policy is to recognize significant transfers between levels at the actual date of the event.

A reconciliation of the beginning and ending Level 3 assets for fiscal years 2021, 2020 and 2019 is as follows:

		Fair Value Measurements Using Significant Unobservable Inputs (Level 3):
		Foreign liability driven investment		Foreign Real Estate Funds		Multi-strategy Hedge Funds		Total
	(In thousands)
Balance at December 30, 2018		$	—	$	22,196	$	16,934	$	39,130
Sales		—		—		(15,586)		(15,586)
Realized gains		—		—		4,175		4,175
Unrealized gains (losses)		—		492		(3,802)		(3,310)
Balance at December 29, 2019		—		22,688		1,721		24,409
Sales		—		—		(1,721)		(1,721)
Unrealized gains		—		571		—		571
Balance at January 3, 2021		—		23,259		—		23,259
Sales		—		(23,115)		—		(23,115)
Realized losses		—		(226)		—		(226)
Realized gains		—		82		—		82
Purchases		165,680		—		—		165,680
Balance at January 2, 2022		$	165,680	$	—	$	—	$	165,680

With respect to plans outside of the United States, the Company expects to contribute $7.0 million in the aggregate during fiscal year 2022. During fiscal years 2021, 2020 and 2019, the Company contributed $6.9 million, $7.5 million and $8.2 million in the aggregate, respectively, to pension plans outside of the United States. During fiscal year 2021, the Company contributed $20.0 million to its defined benefit pension plan in the United States for the plan year 2019.

The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid as follows:

	Non-U.S.		U.S.
	(In thousands)
2022	$	12,538	$	19,419
2023	12,791		19,459
2024	13,461		19,427
2025	13,504		19,368
2026	13,898		19,184
2027-2031	68,663		90,272

The Company also sponsors a supplemental executive retirement plan to provide senior management with benefits in excess of normal pension benefits. Effective July 31, 2000, this plan was closed to new entrants. At January 2, 2022 and January 3, 2021, the projected benefit obligations were $24.1 million and $25.9 million, respectively. Assets with a fair value of $1.6 million and $1.9 million, segregated in a trust (which is included in marketable securities and investments on the consolidated balance sheets), were available to meet this obligation as of January 2, 2022 and January 3, 2021, respectively. Pension expenses and income for this plan netted to expense of $0.2 million in fiscal year 2021, expense of $2.1 million in fiscal year 2020 and expense of $4.8 million in fiscal year 2019.

Postretirement Medical Plans:    The Company provides healthcare benefits for eligible retired U.S. employees under a comprehensive major medical plan or under health maintenance organizations where available. Eligible U.S. employees qualify for retiree health benefits if they retire directly from the Company and have at least ten years of service. Generally, the major medical plan pays stated percentages of covered expenses after a deductible is met and takes into consideration payments by other group coverage and by Medicare. The plan requires retiree contributions under most circumstances and has provisions for cost-sharing charges. Effective January 1, 2000, this plan was closed to new hires. For employees retiring after 1991, the Company has capped its medical premium contribution based on employees’ years of service. The Company funds the amount allowable under a 401(h) provision in the Company’s defined benefit pension plan. Assets of the plan are primarily equity and

debt securities and are available only to pay retiree health benefits. The costs of these plans are not material and the net assets in the plans totaled $20.7 million and $19.0 million at January 2, 2022 and January 3, 2021, respectively.

Deferred Compensation Plans: During fiscal year 1998, the Company implemented a nonqualified deferred compensation plan that provides benefits payable to officers and certain key employees or their designated beneficiaries at specified future dates, or upon retirement or death. The plan was amended to eliminate deferral elections, with the exception of Company 401(k) excess contributions for eligible participants, for plan years beginning January 1, 2011. Benefit payments under the plan are funded by contributions from participants, and for certain participants, contributions by the Company. The obligations related to the deferred compensation plan totaled $0.3 million and $0.6 million as of January 2, 2022 and January 3, 2021, respectively.