Benefit Plans and Other Postretirement Benefits

3 Months Ended

Mar. 31, 2020

Benefit Plans and Other Postretirement Benefits

Benefit Plans and Other Postretirement Benefits

Note 10—Benefit Plans and Other Postretirement Benefits

The Company and certain of its domestic subsidiaries have defined benefit pension plans (the “U.S. Plans”), which cover certain U.S. employees and which represent the majority of the plan assets and benefit obligations of the aggregate defined benefit plans of the Company. The U.S. Plans’ benefits are generally based on years of service and compensation and are generally noncontributory. Certain U.S. employees not covered by the U.S. Plans are covered by defined contribution plans. Certain foreign subsidiaries have defined benefit plans covering their employees (the “Foreign Plans” and, together with the U.S. Plans, the “Plans”). The following is a summary, based on the most recent actuarial valuations of the Company’s net cost for pension benefits, of the Plans for the three months ended March 31, 2020 and 2019:

	Pension Benefits
Three Months Ended March 31:	2020		2019
Service cost	$	2.0	$	1.8
Interest cost		4.2		5.4
Expected return on plan assets		(9.3)		(9.2)
Amortization of prior service cost		0.5		0.4
Amortization of net actuarial losses		6.2		4.6
Net pension expense	$	3.6	$	3.0

There is no current requirement for cash contributions to any of the U.S. Plans, and the Company plans to evaluate annually, based on actuarial calculations and the investment performance of the Plans’ assets, the timing and amount of cash contributions in the future.

The primary investment objective of the Plans is to build and ensure an adequate pool of assets to support the benefit obligations to participants, retirees and beneficiaries. To meet this objective, the Plans seek to earn a rate of return on assets greater than the liability discount rate, with a prudent level of risk and diversification. The current investment policy includes a strategy intended to maintain an adequate level of diversification, subject to normal portfolio risks. As a result of the general market downturn in the first quarter of 2020 resulting from the COVID-19 pandemic, as of March 31, 2020, the fair value of the Plans’ assets has declined. While the Company continues to monitor the performance of its pension plan assets, the declines as of March 31, 2020 have not materially impacted the Company’s financial position or liquidity. To the extent that there is further material deterioration in plan assets, the Company’s pension plans may require additional contributions and/or may negatively impact future pension expense.

The Company offers various defined contribution plans for certain U.S. and foreign employees. Participation in these plans is based on certain eligibility requirements. The Company matches employee contributions to the U.S. defined contribution plans up to a maximum of 6% of eligible compensation. During the three months ended March 31, 2020 and 2019, the Company provided matching contributions to the U.S. defined contribution plans of approximately $3.4 and $4.0, respectively.