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Employee Benefits (Tables)
 12 Months Ended
Dec. 31, 2024
Retirement Benefits [Abstract]  
Schedule of Assumptions Used for Benefit Obligation

Key Assumptions. The following table presents the weighted average assumptions used to determine benefit obligations:

 

 

 

Pension Plans1

 

 

OPEB

 

 

Salaried VEBA

 

 

 

As of December 31,

 

 

As of December 31,

 

 

As of December 31,

 

 

 

2024

 

 

2023

 

 

2024

 

 

2023

 

 

2024

 

 

2023

 

Discount rate

 

 

5.54

%

 

 

4.95

%

 

 

5.48

%

 

 

4.92

%

 

 

5.40

%

 

 

4.89

%

Rate of compensation increase

 

 

2.56

%

 

 

2.63

%

 

 

—

%

 

 

—

%

 

 

—

%

 

 

—

%

 

1.
Assumptions for our pension plans are weighted based on the total benefit obligations of each.
Schedule of Assumptions Used to Determine Net Periodic Postretirement and Postemployment Benefit Cost

The following table presents the weighted average assumptions used to determine net periodic postretirement and postemployment benefit cost:

 

 

 

Pension Plans1

 

 

OPEB

 

 

Salaried VEBA

 

 

 

Year Ended December 31,

 

 

Year Ended December 31,

 

 

Year Ended December 31,

 

 

 

2024

 

 

2023

 

 

2022

 

 

2024

 

 

2023

 

 

2022

 

 

2024

 

 

2023

 

 

2022

 

Discount rate

 

 

5.00

%

 

 

5.19

%

 

 

2.90

%

 

 

4.92

%

 

 

5.14

%

 

 

2.64

%

 

 

4.89

%

 

 

5.10

%

 

 

2.49

%

Expected long-term return on plan assets2

 

 

6.31

%

 

 

6.33

%

 

 

6.02

%

 

 

—

%

 

 

—

%

 

 

—

%

 

 

5.75

%

 

 

5.75

%

 

 

5.50

%

Rate of compensation increase

 

 

2.56

%

 

 

2.63

%

 

 

2.69

%

 

 

—

%

 

 

—

%

 

 

—

%

 

 

—

%

 

 

—

%

 

 

—

%

 

1.
Assumptions for our pension plans are weighted based on the total benefit obligations of each.
2.
The expected long-term rate of return assumption for the Salaried VEBA is based on the targeted investment portfolios provided to us by the trustee of the Salaried VEBA.
Schedule of Changes in Benefit Obligations The following table presents the benefit obligations and funded status of our pension plans, OPEB, and the Salaried VEBA and the corresponding amounts that are included in our Consolidated Balance Sheets (in millions of dollars):

 

 

 

Pension Plans

 

 

OPEB

 

 

Salaried VEBA

 

 

 

As of December 31,

 

 

As of December 31,

 

 

As of December 31,

 

 

 

2024

 

 

2023

 

 

2024

 

 

2023

 

 

2024

 

 

2023

 

Change in benefit obligation:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Obligation at beginning of year

 

$

30.5

 

 

$

18.8

 

 

$

68.8

 

 

$

66.4

 

 

$

46.9

 

 

$

58.9

 

Foreign currency translation adjustment

 

 

(0.5

)

 

 

0.2

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Service cost

 

 

3.6

 

 

 

3.8

 

 

 

1.1

 

 

 

1.1

 

 

 

—

 

 

 

—

 

Interest cost

 

 

1.6

 

 

 

1.3

 

 

 

3.3

 

 

 

3.4

 

 

 

2.2

 

 

 

2.9

 

Prior service cost (credit)1

 

 

2.2

 

 

 

6.6

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(8.8

)

Actuarial (gain) loss2

 

 

(1.6

)

 

 

0.2

 

 

 

(6.8

)

 

 

(0.7

)

 

 

(1.4

)

 

 

0.4

 

Plan participants contributions

 

 

0.1

 

 

 

0.1

 

 

 

0.2

 

 

 

0.1

 

 

 

—

 

 

 

—

 

Benefits paid

 

 

(0.7

)

 

 

(0.5

)

 

 

(1.9

)

 

 

(1.5

)

 

 

(4.8

)

 

 

(6.5

)

Settlements3

 

 

(4.5

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Obligation at end of year4

 

 

30.7

 

 

 

30.5

 

 

 

64.7

 

 

 

68.8

 

 

 

42.9

 

 

 

46.9

 

Change in plan assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fair market value of plan assets at beginning of year

 

 

20.5

 

 

 

14.9

 

 

 

—

 

 

 

—

 

 

 

43.1

 

 

 

42.4

 

Foreign currency translation adjustment

 

 

0.3

 

 

 

0.2

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Actual return on assets

 

 

0.9

 

 

 

1.4

 

 

 

—

 

 

 

—

 

 

 

3.9

 

 

 

6.1

 

Plan participants contributions

 

 

0.1

 

 

 

0.1

 

 

 

0.2

 

 

 

0.1

 

 

 

—

 

 

 

—

 

Company contributions

 

 

5.9

 

 

 

4.4

 

 

 

1.7

 

 

 

1.4

 

 

 

0.7

 

 

 

1.1

 

Benefits paid

 

 

(0.7

)

 

 

(0.5

)

 

 

(1.9

)

 

 

(1.5

)

 

 

(4.8

)

 

 

(6.5

)

Settlements3

 

 

(4.5

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Fair market value of plan assets at end of year

 

 

22.5

 

 

 

20.5

 

 

 

—

 

 

 

—

 

 

 

42.9

 

 

 

43.1

 

Net funded status5

 

$

(8.2

)

 

$

(10.0

)

 

$

(64.7

)

 

$

(68.8

)

 

$

—

 

 

$

(3.8

)

Cumulative gain (loss) recognized in Accumulated other comprehensive income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated net actuarial gain

 

$

4.2

 

 

$

1.3

 

 

$

23.1

 

 

$

17.4

 

 

$

8.2

 

 

$

5.2

 

Prior service cost

 

 

(7.6

)

 

 

(6.1

)

 

 

—

 

 

 

—

 

 

 

(14.3

)

 

 

(16.0

)

Total

 

$

(3.4

)

 

$

(4.8

)

 

$

23.1

 

 

$

17.4

 

 

$

(6.1

)

 

$

(10.8

)

 

1.
The prior service cost relating to our pension plans in 2024 resulted from an amendment to the Kaiser Aluminum Warrick pension plan clarifying certain plan provisions going back to the date of our acquisition of Warrick. The prior service cost relating to our pension plans in 2023 resulted from a new four-year collective bargaining agreement with the USW Local 104. In connection with the agreement, we amended the Kaiser Aluminum Warrick pension plan to increase certain pension benefits for covered plan participants. The prior service credit relating to the Salaried VEBA in 2023 resulted from a decrease in the annual healthcare reimbursement benefit for plan participants.
2.
The actuarial gain relating to our pension plans in 2024 was comprised of a $2.2 million gain due to a change in the discount rate, partially offset by a $0.3 million loss due to changes in census information and a $0.3 million loss recognized in conjunction with a group annuity purchase. The actuarial loss relating to our pension plans in 2023 was comprised of a $0.5 million loss due to a change in the discount rate and a $0.3 million gain due to changes in census information. The actuarial gain relating to the OPEB in 2024 was comprised of a $6.5 million gain due to changes in census information, a $3.3 million gain due to a change in the discount rate, a $3.2 million gain due to a change in morbidity assumptions, a $3.3 million loss due to a change in the trend rate assumption, and a $2.9 million loss due to a change in the projected depletion year. The actuarial gain relating to the OPEB in 2023 was comprised of a $2.7 million gain due to a change in the projected depletion year, a $2.5 million gain due to changes in census information, a $3.1 million loss due to a change in the trend rate assumption, and a $1.4 million loss due to a change in the discount rate. The actuarial gain relating to the Salaried VEBA in 2024 was comprised of a $1.4 million gain due to a change in the discount rate, a $0.1 million gain due to changes in census information, and a $0.1 million loss due to a change in the trend rate assumption.
The actuarial loss relating to the Salaried VEBA in 2023 was comprised of a $0.7 million loss due to a change in the discount rate and a $0.3 million gain due to changes in census information.
3.
In the fourth quarter of 2024, we entered into a group annuity purchase agreement under which approximately $4.5 million of obligations for certain participants of the Kaiser Aluminum Canada Limited Retirement Plan for Salaried Employees were transferred to an insurance company. The annuitization was funded through existing plan assets and does not change the amount of the monthly pension benefits received by the affected participants.
4.
For the pension plans, the benefit obligation is the projected benefit obligation. For the Salaried VEBA and OPEB, the benefit obligation is the APBO.
5.
At December 31, 2024, Net funded status relating to the pension plans consisted of $1.6 million within Other assets and $9.8 million within Pension and OPEB on our Consolidated Balance Sheets. At December 31, 2023, Net funded status relating to the pension plans consisted of $1.3 million within Other assets and $11.3 million within Pension and OPEB on our Consolidated Balance Sheets. Of the Net funded status relating to the OPEB at December 31, 2024, $3.1 million was included within Accrued salaries, wages and related expenses and $61.6 million was included within Pension and OPEB on our Consolidated Balance Sheets. Of the Net funded status relating to the OPEB at December 31, 2023, $3.3 million was included within Accrued salaries, wages and related expenses and $65.5 million was included within Pension and OPEB on our Consolidated Balance Sheets. Net funded status relating to the Salaried VEBA at December 31, 2024 and December 31, 2023 was included within Net liabilities of Salaried VEBA on our Consolidated Balance Sheets.
Schedule of Expected Benefit Payments

The following table presents the net benefits expected to be paid (in millions of dollars):

 

 

 

Year Ended December 31,

 

 

 

2025

 

 

2026

 

 

2027

 

 

2028

 

 

2029

 

 

2030-2034

 

Pension benefit payments

 

$

0.7

 

 

$

0.9

 

 

$

1.1

 

 

$

1.3

 

 

$

1.7

 

 

$

11.7

 

Salaried VEBA benefit payments1

 

 

5.3

 

 

 

5.1

 

 

 

4.9

 

 

 

4.6

 

 

 

4.3

 

 

 

16.9

 

OPEB payments

 

 

3.1

 

 

 

3.8

 

 

 

4.4

 

 

 

5.1

 

 

 

5.8

 

 

 

34.8

 

Total

 

$

9.1

 

 

$

9.8

 

 

$

10.4

 

 

$

11.0

 

 

$

11.8

 

 

$

63.4

 

 

1.
Such amounts are based on benefit amounts and certain key assumptions obtained from the Salaried VEBA trustees and will be paid out of the Salaried VEBA plan assets. We have an ongoing obligation to make variable cash contributions to the Salaried VEBA, up to a maximum of $2.9 million annually based on our cash flow.
Summary of Asset Class Allocation per Pension Plan Investment Policy and Weighted Average Asset Allocation

Plan Assets. The fundamental goal underlying our pension plan investment policy is to ensure that the assets of the plans are invested in a prudent manner to earn a rate of return over time to meet the obligations of the plans as these obligations come due. Risk management practices include diversification across asset classes and periodic rebalancing toward established asset allocation targets. Our investment policy permits variances from the targets within certain parameters.

 

The following table presents the weighted-average target and actual asset class allocations for our pension plans:

 

Asset class

 

2024 Target allocation

 

As of December 31, 2024

Equities

 

56%

 

55%

Fixed income

 

38%

 

38%

Real estate investments

 

5%

 

6%

Cash and short-term investments

 

1%

 

1%
Schedule of Fair Value of Plan Assets

The following table presents the fair value of plan assets at December 31, 2024 and 2023, classified under the appropriate level of the fair value hierarchy (in millions of dollars):

 

 

 

December 31, 2024

 

 

December 31, 2023

 

 

Plan Assets in the Fair Value Hierarchy:

 

Level 1

 

 

Salaried VEBA – Equity investment funds in registered investment companies1

 

$

25.2

 

 

$

25.5

 

 

Salaried VEBA – Fixed income investment funds in registered investment companies2

 

 

16.8

 

 

 

16.5

 

 

Salaried VEBA – Cash and money market investments

 

 

0.2

 

 

 

—

 

 

Pension plans – Diversified investment funds in pooled separate accounts3

 

 

17.1

 

 

 

11.2

 

 

Pension plans – Diversified investment funds in registered investment companies4

 

 

5.4

 

 

 

9.3

 

 

Deferred compensation program – Diversified investment funds in registered investment companies4

 

 

11.9

 

 

 

11.1

 

 

Total plan assets in the fair value hierarchy

 

$

76.6

 

 

$

73.6

 

 

 

1.
Equity investment funds in registered investment companies. This category represents investments in equity funds.
2.
Fixed income investment funds in registered investment companies. This category represents investments in various fixed income funds with multiple registered investment companies. Such funds invest primarily in bonds, debentures, notes, securities with equity and fixed-income characteristics, cash equivalents, securities backed by mortgages and other assets, loans, pooled or collective investment vehicles made up of fixed‑income securities and other fixed-income obligations of banks, corporations, and governmental authorities.
3.
Diversified investment funds in pooled separate accounts. The plan assets are invested in various pooled separate accounts that hold a diversified portfolio of: (i) equity and equity-related securities of U.S. and non-U.S. issuers across all market capitalizations; (ii) fixed income securities such as corporate bonds and government bonds; and (iii) commercial real estate, including mortgage loans which are backed by the associated properties. The pooled separate accounts are valued daily based on the market value of the underlying net assets in each separate account. The majority of the underlying net assets have observable Level 1 pricing inputs which are used to determine the unit value of the pooled separate account which is not publicly quoted.
4.
Diversified investment funds in registered investment companies. The assets in the rabbi trust are invested in investment funds that hold a diversified portfolio of: (i) U.S. and international debt and equity securities; (ii) fixed income securities such as corporate bonds and government bonds; (iii) mortgage-related securities; and (iv) cash and cash equivalents.
Schedule of Total Expense Related to Benefit Plans

The following table presents the total expense related to all benefit plans (in millions of dollars):

 

 

 

Year Ended December 31,

 

 

 

2024

 

 

2023

 

 

2022

 

Defined contribution plans1

 

$

18.6

 

 

$

18.1

 

 

$

17.1

 

Deferred compensation plan2

 

 

1.3

 

 

 

1.2

 

 

 

(0.6

)

Multiemployer pension plans1,3

 

 

6.1

 

 

 

5.6

 

 

 

5.2

 

Net periodic postretirement and postemployment benefit cost relating to defined benefit plans2,3,4

 

 

9.0

 

 

 

13.4

 

 

 

13.1

 

Total

 

$

35.0

 

 

$

38.3

 

 

$

34.8

 

 

1.
Substantially all of these charges related to employee benefits are in COGS with the remaining balance in SG&A and R&D within our Statements of Consolidated Income (Loss).
2.
Deferred compensation plan expense and the current service cost component of Net periodic postretirement and postemployment benefit cost relating to Salaried VEBA are included within our Statements of Consolidated Income (Loss) in SG&A and R&D for all periods presented. All other components of Net periodic postretirement and postemployment benefit cost relating to Salaried VEBA are included within Other income, net, in our Statements of Consolidated Income (Loss).
3.
See Note 6 for more information on our multiemployer defined benefit pension plans. For the year ended December 31, 2024, the expense presented excludes a $4.6 million charge to Restructuring costs (see Note 12).
4.
The current service cost component of Net periodic postretirement and postemployment benefit cost relating to both the pension plans and the OPEB plan is included within COGS in our Statements of Consolidated Income (Loss) for all periods presented. All other components of Net periodic postretirement and postemployment benefit cost relating to both the pension plans and the OPEB plan are included within Other income, net, in our Statements of Consolidated Income (Loss).
Schedule of Net Benefit Costs The following table presents the components of Net periodic postretirement and postemployment benefit cost relating to our defined benefit plans (in millions of dollars):

 

 

 

Pension Plans

 

 

OPEB

 

 

Salaried VEBA

 

 

 

Year Ended December 31,

 

 

Year Ended December 31,

 

 

Year Ended December 31,

 

 

 

2024

 

 

2023

 

 

2022

 

 

2024

 

 

2023

 

 

2022

 

 

2024

 

 

2023

 

 

2022

 

Service cost

 

$

3.6

 

 

$

3.8

 

 

$

5.8

 

 

$

1.1

 

 

$

1.1

 

 

$

1.6

 

 

$

—

 

 

 

—

 

 

$

0.1

 

Interest cost

 

 

1.6

 

 

 

1.3

 

 

 

0.6

 

 

 

3.3

 

 

 

3.4

 

 

 

2.2

 

 

 

2.2

 

 

 

2.9

 

 

 

1.9

 

Expected return on plan assets

 

 

(1.4

)

 

 

(1.1

)

 

 

(0.9

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(2.2

)

 

 

(2.2

)

 

 

(3.1

)

Amortization of prior service cost1

 

 

0.8

 

 

 

0.4

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

1.7

 

 

 

4.9

 

 

 

4.9

 

Amortization of net actuarial gain

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(1.1

)

 

 

(1.1

)

 

 

—

 

 

 

(0.1

)

 

 

—

 

 

 

—

 

Settlement gain recognized

 

 

(0.5

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Total net periodic postretirement and postemployment benefit cost

 

$

4.1

 

 

$

4.4

 

 

$

5.5

 

 

$

3.3

 

 

$

3.4

 

 

$

3.8

 

 

$

1.6

 

 

$

5.6

 

 

$

3.8

 

 

1.
We amortize prior service cost on a straight-line basis over the average remaining years of service of the active plan participants.