Employee Benefit Plans

12 Months Ended

Oct. 29, 2023

Employee Bonus Plans

We have various employee bonus plans. A discretionary bonus plan provides for the distribution of a percentage of pre-tax income to our employees who are not participants in other performance-based incentive plans, up to a maximum percentage of eligible compensation. Other plans provide for bonuses to our executives and other key contributors based on the achievement of profitability and/or other specified performance criteria. Charges under these plans for fiscal 2023, 2022 and 2021 were $702 million, $623 million and $631 million, respectively.

Employee Savings and Retirement Plan

Our Employee Savings and Retirement Plan (the 401(k) Plan) is qualified under Sections 401(a) and (k) of the Internal Revenue Code (the Code). Eligible employees may make salary deferral and catch-up contributions under the 401(k) Plan on a pre-tax basis and on a Roth basis, subject to an annual dollar limit established by the Code. We match 100% of participant salary and/or Roth deferral contributions up to the first 3% of eligible contribution and then 50% of every dollar between 4% and 6% of eligible contribution. We do not make matching contributions on any catch-up contributions made by participants. Plan participants who were employed by us or any of our affiliates are 100% vested in their matching contribution account balances. Our matching contributions under the 401(k) Plan were approximately $85 million for fiscal 2023, $67 million for fiscal 2022 and $61 million for fiscal 2021.

Defined Benefit Pension Plans of Foreign Subsidiaries and Other Postretirement Benefits

Several of our foreign subsidiaries have defined benefit pension plans covering substantially all of their eligible employees. Benefits under these plans are typically based on years of service and final average compensation levels. The plans are managed in accordance with applicable local statutes and practices. We deposit funds for certain of these plans with insurance companies, pension trustees, government-managed accounts, and/or accrue the expense for the unfunded portion of the benefit obligation on our Consolidated Financial Statements. Our practice is to fund the various pension plans in amounts sufficient to meet the minimum requirements as established by applicable local governmental oversight and taxing authorities. Depending on the design of the plan, local custom and market circumstances, the liabilities of a plan may exceed the qualified plan assets. The differences between the aggregate projected benefit obligations and aggregate plan assets of these plans have been recorded as liabilities by us and are included in other liabilities and accrued expenses in the Consolidated Balance Sheets.

A summary of the changes in benefit obligations and plan assets, which includes post-retirement benefits, for each fiscal year is presented below:


	2023		2022		2021

	(In millions, except percentages)
Change in projected benefit obligation
Beginning projected benefit obligation	$	414	$	685	$	674
Service cost	10		14		15
Interest cost	16		9		8
Plan participants’ contributions	1		1		1
Actuarial (gain) loss	(38)		(201)		(1)

Foreign currency exchange rate changes	15		(84)		3
Benefits paid	(10)		(10)		(15)
Plan amendments and other adjustments	—		—		—
Ending projected benefit obligation	$	408	$	414	$	685
Ending accumulated benefit obligation	$	351	$	371	$	626
Range of assumptions to determine benefit obligations
Discount rate	1.3% - 7.1%		1.5% - 7.3%		0.6% - 6.6%
Rate of compensation increase	3.3% - 10.3%		2.7% - 10.0%		2.4% - 10.0%
Change in plan assets
Beginning fair value of plan assets	$	351	$	491	$	431
Return on plan assets	5		(78)		49
Employer contributions	9		11		22
Plan participants’ contributions	1		1		1
Foreign currency exchange rate changes	18		(64)		3

Benefits paid	(10)		(10)		(15)
Ending fair value of plan assets	$	374	$	351	$	491
Funded status	$	(34)	$	(63)	$	(194)
Amounts recognized in the consolidated balance sheets
Noncurrent asset	$	95	$	45	$	1
Current liability	(3)		(1)		(2)
Noncurrent liability	(126)		(107)		(193)
Total	$	(34)	$	(63)	$	(194)
Estimated amortization from accumulated other comprehensive loss into net periodic benefit cost over the next fiscal period
Actuarial loss	$	3	$	4	$	11
Prior service credit	—		—		—
Total	$	3	$	4	$	11
Amounts recognized in accumulated other comprehensive loss
Net actuarial loss	$	70	$	98	$	200
Prior service credit	1		1		1
Total	$	71	$	99	$	201
Plans with projected benefit obligations in excess of plan assets
Projected benefit obligation	$	146	$	126	$	472
Fair value of plan assets	$	18	$	17	$	277
Plans with accumulated benefit obligations in excess of plan assets
Accumulated benefit obligation	$	97	$	88	$	413
Fair value of plan assets	$	18	$	17	$	277


	2023		2022
Plan assets — allocation
Equity securities	29	%	26	%
Debt securities	31	%	37	%
Insurance contracts	19	%	21	%
Other investments	20	%	15	%
Cash	1	%	1	%

The following table presents a summary of the ending fair value of the plan assets:


	October 29, 2023								October 30, 2022
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total

	(In millions)
Equity securities	$	102	$	—	$	—	$	102	$	84	$	—	$	—	$	84
Debt securities	60		—		—		60		56		—		—		56
Insurance contracts	—		—		72		72		—		—		72		72
Other investments	—		57		—		57		—		52		—		52
Cash	5		—		—		5		3		—		—		3
Total assets at fair value	$	167	$	57	$	72	296		$	143	$	52	$	72	267
Assets measured at net asset value							78								84
Total							$	374							$	351

The following table presents the activity in Level 3 instruments for each fiscal year:


	2023		2022

	(In millions)
Balance, beginning of year	$	72	$	110
Actual return on plan assets:
Relating to assets still held at reporting date	(4)		(24)
Purchases, sales, settlements, net	—		—
Currency impact	4		(14)
Balance, end of year	$	72	$	72

Our investment strategy for our defined benefit plans is to invest plan assets in a prudent manner, maintaining well-diversified portfolios with the long-term objective of meeting the obligations of the plans as they come due. Asset allocation decisions are typically made by plan fiduciaries with input from our international pension committee. Our asset allocation strategy incorporates a sufficient equity exposure in order for the plans to benefit from the expected better long-term performance of equities relative to the plans’ liabilities. We retain investment managers, where appropriate, to manage the assets of the plans. Performance of investment managers is monitored by plan fiduciaries with the assistance of local investment consultants. The investment managers make investment decisions within the guidelines set forth by plan fiduciaries. Risk management practices include diversification across asset classes and investment styles, and periodic rebalancing toward target asset allocation ranges. Investment managers may use derivative instruments for efficient portfolio management purposes.

A summary of the components of net periodic benefit costs and the weighted average assumptions used for net periodic benefit cost calculations for each fiscal year is presented below:


	2023			2022			2021

	(In millions, except percentages)
Components of net periodic benefit cost
Service cost	$	10		$	14		$	15
Interest cost	16			9			8
Expected return on plan assets	(20)			(21)			(21)
Amortization of actuarial loss and prior service credit	4			10			14

Net periodic benefit cost	$	10		$	12		$	16
Weighted average assumptions
Discount rate	3.48		%	1.41		%	1.18		%
Expected long-term return on assets	5.15		%	4.56		%	4.80		%
Rate of compensation increase	3.39		%	2.89		%	2.74		%

Asset return assumptions are derived based on actuarial and statistical methodologies, from analysis of long-term historical data relevant to the country in which each plan is in effect and the investments applicable to the corresponding plan. The discount rate for each plan was derived by reference to appropriate benchmark yields on high quality corporate bonds, allowing for the approximate duration of both plan obligations and the relevant benchmark yields.

Future expected benefit payments for the pension plans and the postretirement plan over the next ten fiscal years are as follows:


	Benefit Payments
	(In millions)
2024	$	11
2025	14
2026	15
2027	16
2028	16
2029-2033	108
Total	$	180

Company contributions to these plans for fiscal 2024 are expected to be approximately $8 million.

Executive Deferred Compensation Plans

We sponsor two unfunded deferred compensation plans, the Executive Deferred Compensation Plan (Predecessor EDCP) and the 2016 Deferred Compensation Plan (2016 DCP) (formerly known as the 2005 Executive Deferred Compensation Plan), under which certain employees may elect to defer a portion of their following year’s eligible earnings. The Predecessor EDCP was frozen as of December 31, 2004 such that no new deferrals could be made under the plan after that date and the plan would qualify for “grandfather” relief under Section 409A of the Code. The Predecessor EDCP participant accounts continue to be maintained under the plan and credited with deemed interest. The 2016 DCP was originally implemented by us effective as of January 1, 2005, and amended and restated as of October 12, 2015, and is intended to comply with the requirements of Section 409A of the Code. In addition, we also sponsor a non-qualified deferred compensation plan as a result of the acquisition of Varian. Amounts payable for all plans, including accrued deemed interest, totaled $245 million and $200 million at October 29, 2023 and October 30, 2022, respectively, which were included in other liabilities in the Consolidated Balance Sheets.