EMPLOYEE BENEFIT PLANS

6 Months Ended

Jul. 02, 2022

Retirement Benefits [Abstract]

EMPLOYEE BENEFIT PLANS

EMPLOYEE BENEFIT PLANS

On February 17, 2022, we transferred our existing liability under the SPX Postretirement Benefit Plans (the “Plans”) for a group of participants with retiree life insurance benefits to an insurance carrier for consideration payable to the insurance carrier of approximately $10.0. Of this consideration, $9.0 was paid during the quarter ended April 2, 2022, with the remainder paid in the second quarter of 2022. This transaction resulted in a settlement charge of $0.7 recorded to “Other income (expense), net” during the first quarter of 2022. In addition, and in connection with this transfer, we remeasured the assets and liabilities of the Plans as of the transfer date, which resulted in an actuarial gain of $0.4 recorded to “Other income (expense), net” for the three months ended April 2, 2022. Lastly, as a result of the transfer, we have eliminated the third-party cost and internal resource requirements associated with administering these benefits.

Participants in the SPX U.S. Pension Plan (the “U.S. Plan”) are eligible to elect a lump-sum payment option in lieu of a future pension benefit. During the first half of 2022, $10.0 was paid to participants who elected lump-sum payments. This triggered a plan settlement which resulted in a charge to "Other income (expense), net" of $2.3 during the quarter ended July 2, 2022. In addition, we remeasured assets and liabilities of the U.S. Plan at July 2, 2022, which resulted in an actuarial loss of $1.5 to "Other income (expense), net" during the quarter. In connection with the remeasurement we updated our actuarial assumptions, the only change of significance being the discount rate, which increased from 2.83% to 4.86%.

Net periodic benefit (income) expense for our pension and postretirement plans include the following components:

Domestic Pension Plans

	Three months ended				Six months ended
	July 2, 2022		July 3, 2021		July 2, 2022		July 3, 2021
Service cost	$	—	$	—	$	—	$	—
Interest cost	2.3		2.1		4.6		4.2
Expected return on plan assets	(2.1)		(2.2)		(4.2)		(4.4)
Settlement and actuarial losses (1)	3.8		—		3.8		—
Net periodic pension benefit (income) expense	$	4.0	$	(0.1)	$	4.2	$	(0.2)

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(1)     Consists of an actuarial loss of $1.5 and a settlement loss of $2.3.

Foreign Pension Plans

	Three months ended				Six months ended
	July 2, 2022		July 3, 2021		July 2, 2022		July 3, 2021
Service cost	$	—	$	—	$	—	$	—
Interest cost	1.0		0.8		2.0		1.6
Expected return on plan assets	(1.5)		(1.4)		(3.0)		(2.8)
Net periodic pension benefit income	$	(0.5)	$	(0.6)	$	(1.0)	$	(1.2)

Postretirement Plans

	Three months ended				Six months ended
	July 2, 2022		July 3, 2021		July 2, 2022		July 3, 2021
Service cost	$	—	$	—	$	—	$	—
Interest cost	0.3		0.3		0.6		0.6
Amortization of unrecognized prior service credits	(1.1)		(1.2)		(2.2)		(2.4)
Settlement loss, net (1)	—		—		0.3		—
Net periodic postretirement benefit income	$	(0.8)	$	(0.9)	$	(1.3)	$	(1.8)

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(1)     The six months ended July 2, 2022 includes the impact of the transfer of the retiree life insurance benefits obligation.