Defined Contribution Plans and deferred compensation

12 Months Ended

Dec. 31, 2023

Retirement Benefits [Abstract]

Defined contribution plans and deferred compensation

19. Defined contribution plans and deferred compensation

Defined Contribution Plans

Orthofix sponsors a defined contribution plan (the “401(k) Plan”) covering substantially all full-time U.S. employees. The 401(k) Plan allows participants to contribute up to 80% of their pre-tax compensation, subject to certain limitations, with the Company matching 100% of the first 2% of the employee’s base compensation and 50% of the next 4% of the employee’s base compensation if contributed to the 401(k) Plan. During the years ended December 31, 2023, 2022, and 2021, expenses incurred relating to the 401(k) Plan, including matching contributions, were approximately $4.6 million, $3.3 million, and $2.8 million, respectively.

The Company also operates defined contribution plans for its international employees meeting minimum service requirements. The Company’s expenses for such contributions during each of the years ended December 31, 2023, 2022, and 2021, were $1.1 million, $1.1 million, and $1.2 million, respectively.

Effective February 1, 2024, Orthofix amended the 401(k) Plan to allow participants to contribute up to 90% of their pre-tax compensation, subject to certain limitations, with the Company matching 100% of the first 4% of the employee's base compensation.

Deferred Compensation Plans

Under Italian Law, our Italian subsidiary accrues deferred compensation on behalf of its employees, which is paid on termination of employment. The accrual for deferred compensation is based on a percentage of the employee’s current annual remuneration plus an annual charge. Deferred compensation is also accrued for the leaving indemnity payable to agents in case of dismissal, which is regulated by a national contract and is equal to approximately 4% of total commissions earned from the Company. The Company’s relations with its Italian employees, who represent 14% of total employees at December 31, 2023, are governed by the provisions of a National Collective Labor Agreement setting forth mandatory minimum standards for labor relations in the metal mechanic workers industry. The Company is not a party to any other collective bargaining agreement. The balance in other long-term liabilities as of December 31, 2023, and 2022 was $1.7 million and $1.5 million, respectively, and represents the amount that would be payable if all the employees and agents had terminated employment at that date.