Employee benefits

The Company sponsors a number of U.S. and foreign pension plans as well as other nonpension postretirement and postemployment plans to provide various benefits for its employees. These plans are described within the footnotes to the Consolidated Financial Statements included in the Company’s 2016 Annual Report on Form 10-K. Components of Company plan benefit expense for the periods presented are included in the tables below.

In September 2017, the Company amended certain defined benefit pension plans in the U.S. and Canada for salaried employees. As of December 31, 2018, the amendment will freeze the compensation and service periods used to calculate pension benefits for active salaried employees who participate in the affected pension plans. Beginning January 1, 2019, impacted employees will not accrue additional benefits for future service and eligible compensation received under these plans.

Concurrently, the Company also amended its 401(k) savings plans effective January 1, 2019, to make previously ineligible salaried U.S. and Canada employees eligible for Company retirement contributions, which range from 3% to 7% of eligible compensation based on the employee’s length of employment.

Pension



	Quarter ended						Year-to-date period ended
(millions)	September 30, 2017			October 1, 2016			September 30, 2017			October 1, 2016
Service cost	$	22		$	25		$	72		$	74
Interest cost	40			43			123			131
Expected return on plan assets	(97		)	(87		)	(277		)	(266		)
Amortization of unrecognized prior service cost	3			3			7			10
Recognized net (gain) loss	83			28			84			28
Net periodic benefit cost	51			12			9			(23		)
Curtailment (gain) loss	(134		)	—			(136		)	—
Total pension (income) expense	$	(83	)	$	12		$	(127	)	$	(23	)

Other nonpension postretirement



	Quarter ended						Year-to-date period ended
(millions)	September 30, 2017			October 1, 2016			September 30, 2017			October 1, 2016
Service cost	$	5		$	5		$	14		$	15
Interest cost	10			10			28			29
Expected return on plan assets	(24		)	(22		)	(73		)	(67		)
Amortization of unrecognized prior service (gain)	(3		)	(2		)	(7		)	(7		)
Recognized net (gain) loss	—			—			(29		)	—
Net periodic benefit cost	(12		)	(9		)	(67		)	(30		)
Curtailment loss	—			—			3			—
Total postretirement benefit (income) expense	$	(12	)	$	(9	)	$	(64	)	$	(30	)

Postemployment



	Quarter ended				Year-to-date period ended
(millions)	September 30, 2017		October 1, 2016		September 30, 2017		October 1, 2016
Service cost	$	1	$	1	$	4	$	5
Interest cost	—		1		2		3
Recognized net loss	—		1		1		3
Total postemployment benefit expense	$	1	$	3	$	7	$	11

During the third quarter of 2017, the Company recognized pension plan curtailment gains totaling $134 million in conjunction with Project K restructuring activity which resulted from the amendment of certain defined benefit pension plans in the U.S. and Canada and workforce reductions. The Company remeasured the benefit obligation for the impacted pension plans resulting in a mark-to-market loss of $83 million. The loss was due primarily to changes in discount rates, partially offset by plan asset returns in excess of the expected rate of return.

On a year-to-date basis, the Company recognized pension plan curtailment gains totaling $136 million and a curtailment loss of $3 million within a nonpension postretirement plan, in conjunction with Project K restructuring activity. The curtailment gains and losses resulted from the amendment of certain defined benefit pension plans in the U.S. and Canada and global workforce reductions. In addition, the Company remeasured the benefit obligation for impacted pension and nonpension postretirement plans. The remeasurement resulted in a mark-to-market loss of $84 million on pension plans due primarily to a lower discount rate and a $29 million gain on a nonpension postretirement plan primarily due to plan asset investment returns slightly mitigated by the impact of a lower discount rate.

Company contributions to employee benefit plans are summarized as follows:



(millions)	Pension		Nonpension postretirement		Total
Quarter ended:
September 30, 2017	$	2	$	3	$	5
October 1, 2016	$	3	$	3	$	6
Year-to-date period ended:
September 30, 2017	$	25	$	8	$	33
October 1, 2016	$	18	$	11	$	29
Full year:
Fiscal year 2017 (projected)	$	26	$	16	$	42
Fiscal year 2016 (actual)	$	18	$	15	$	33

Plan funding strategies may be modified in response to management’s evaluation of tax deductibility, market conditions, and competing investment alternatives.

Additionally, during the first quarter of 2017, the Company recognized expense totaling $26 million related to the exit of several multi-employer plans associated with Project K restructuring activity. This amount represents management's best estimate, actual results could differ. The cash obligation is payable over a maximum 20-year period; management has not determined the actual period over which the payments will be made.