Employee Benefit Plans

We have established a number of employee benefit programs for purposes of attracting, retaining, and motivating our employees. The following is a description of the basic components of these programs as of December 31, 2013.

Savings and Retirement Plans

We maintain a defined contribution savings and retirement plan that allows employees to make pre-tax and after-tax contributions. Under the plan, participating employees may elect to contribute up to 50% of their eligible earnings (subject to IRS rules and regulations) and are eligible to receive a company match of up to $600, which was reinstated in 2012. Participating employees become vested in matching contributions on a pro-rata basis over five years of credited service. Our contribution expense for this plan was $12.5 million, $10.0 million, and $38,000 for the years ended December 31, 2013, 2012, and 2011, respectively.

We maintain several supplemental executive retirement plans ("SERP") to provide additional retirement benefits to a select group of former executives. The total liability reported in deferred credits and other for the SERP plans was $29.7 million as of December 31, 2013, and $32.0 million as of December 31, 2012.

Pension Commitments

With the acquisition of London Clubs, a CEOC subsidiary, in 2006 we assumed a defined benefit plan that provides benefits based on final pensionable salary. The assets of the plan are held in a separate trustee-administered fund and death-in-service benefits, professional fees, and other expenses are paid by the pension plan.

In the fourth quarter of 2013, Caesars elected to change its method of accounting for actuarial gains and losses for its pension plan in the United Kingdom to a preferable method permitted under GAAP. The new method (“Immediate Recognition Method”) recognizes actuarial gains and losses in operating results in the year in which the gains and losses occur rather than deferring them into Other Comprehensive Loss and amortizing them over future periods (“Deferral Method”). Caesars management believes that this accounting change improves the transparency of reporting by providing recognition of current economic and interest rate trends in the current period results, as opposed to deferring them and recognizing them over future periods. We applied this accounting change retrospectively to all periods presented, which increased property, general, and administrative expense, as well as net loss, by $9.9 million, $6.8 million, and $27.5 million for 2013, 2012, and 2011, respectively. The impact of the accounting change on all other financial statement line items was immaterial. We made an immaterial correction to the historical accounting for actuarial gains and losses, which increased property, general, administrative, and other expense, as well as net loss, by $3.8 million in 2012 and $9.9 million in 2011, respectively. The total decrease to basic and diluted earnings per share as a result of the above was $0.07, $0.09, and $0.30 for 2013, 2012, and 2011, respectively. In addition, as of January 1, 2011, we recognized an increase to accumulated deficit totaling $44.3 million, which included an immaterial error correction of $6.2 million.

This accounting change does not impact our debt covenant calculation and there is no impact on cash funding of the pension plan. During the fourth quarter 2013, we recognized $9.9 million in increased pension expense as compared to our previous method of accounting for this pension. Total plan assets at December 31, 2013 were $195.8 million with total projected benefit obligation totaling $270.8 million, resulting in a net pension liability of $75.0 million. Our estimated long term expected return on assets for this plan, which has been frozen since 2010 is 6.3%, with a 4.4% discount rate.

Multiemployer Pension Plan

The Company contributes to a number of multiemployer defined benefit pension plans under the terms of collective-bargaining agreements that cover its union-represented employees. The risks of participating in these multiemployer plans are different from a single-employer plan in the following aspects:


a.	Assets contributed to the multiemployer plan by one employer may be used to provide benefits to employees of other participating employers.


b.	If a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers.


c.	If the Company chooses to stop participating in some of its multiemployer plans, the Company may be required to pay those plans an amount based on the underfunded status of the plan, referred to as a "withdrawal liability."

Multiemployer Pension Plan Participation



		Pension Protection Act Zone Status ⁽¹⁾			Contributions (In millions)
Pension Fund	EIN/Pension Plan Number	2013	2012	FIP/RP Status ⁽²⁾	2013		2012		2011		Surcharge Imposed	Expiration Date of Collective-Bargaining Agreement
Southern Nevada Culinary and Bartenders Pension Plan	88-6016617/001	Green	Green	No	$	20.0	$	18.7	$	16.3	No	May 31, 2018
Pension Plan of the UNITE HERE National Retirement Fund	13-6130178/001	Red	Red	Yes	14.0		13.8		12.8		No	September 14, 2014
Local 68 Engineers Union Pension Plan ⁽³⁾	51-0176618/001	Yellow	Green	Yes	1.5		1.5		1.6		No	April 30, 2014
NJ Carpenters Pension Fund	22-6174423/001	Yellow	Yellow	Yes	0.5		0.4		0.4		No	April 30, 2014
Other Funds					12.6		12.5		13.7
Total Contributions					$	48.6	$	46.9	$	44.8

____________________


⁽¹⁾	Represents the Pension Protection Act ("PPA") zone status for applicable plan year beginning January 1, 2013, except where noted otherwise.


⁽²⁾	Indicates plans for which a financial improvement plan ("FIP") or a rehabilitation plan ("RP") is either pending or has been implemented.


⁽³⁾	Plan years begin July 1.

The zone status is based on information that the Company received from the plan administrator and is certified by the plan's actuary. Among other factors, plans in the red zone are generally less than less than 65% funded, plans in the yellow zone are between 65% and less than 80% funded, and plans in the green zone are at least 80% funded. All plans detailed in the table above utilized extended amortization provisions to calculate zone status.

Plans with Company Contributions in Excess of 5% of Total Plan Contributions



Pension Fund		Applicable Plan Years
Pension Plan of the UNITE HERE National Retirement Fund		2012 and 2011
Southern Nevada Culinary and Bartenders Pension Plan		2012 and 2011
Local 68 Engineers Union Pension Plan		2012 and 2011
Nevada Resort Association IATSE Local 720 Retirement Plan		2012 and 2011

At the date these financial statements were issued, Forms 5500 were not available for the plan year ending in 2013.

Deferred Compensation Plans

The Company has one active and five frozen deferred compensation plans. Amounts deposited into these deferred compensation plans are unsecured liabilities of the Company. The total liability recorded in deferred credits and other for these plans is $84.3 million as of December 31, 2013 and $82.8 million as of December 31, 2012. Company matching contributions to the active plan were suspended beginning in February 2009, though participants continue to vest in contributions made prior to that date.

The active plan is the Executive Supplemental Savings Plan II ("ESSP II") and allows eligible executive officers, directors, and other key employees to elect to defer a percentage of their salary and/or bonus. Participants immediately vest in their own elective deferrals and vest in Company funded matching and discretionary contributions on a pro-rata basis over five years. However, Company matching contributions to this plan were suspended beginning in February 2009, though participants continue to vest in contributions made prior to that date.

The five frozen plans that contain deferred compensation assets are as follows: (1) Harrah's Executive Deferred Compensation Plan ("EDCP"), (2) the Harrah's Executive Supplemental Savings Plan ("ESSP"), (3) Harrah's Deferred Compensation Plan ("HDCP"), (4) the Restated Park Place Entertainment Corporation Executive Deferred Compensation Plan, and (5) the Caesars World, Inc. Executive Security Plan. Employees may no longer contribute to these plans.