EMPLOYEE BENEFIT PLANS (Tables)

12 Months Ended

Dec. 31, 2019

EMPLOYEE BENEFIT PLANS

Schedule of changes in benefit obligations and plan assets and disclosure of funded status and accumulated benefit obligation of nonunion defined benefit plans

The following table discloses the changes in benefit obligations and plan assets of the Company’s nonunion defined benefit plans for years ended December 31, the measurement date of the plans:

	Nonunion Defined				Supplemental				Postretirement
	Benefit Pension Plan				Benefit Plan				Health Benefit Plan
	2019		2018		2019		2018		2019		2018
	(in thousands)
Change in benefit obligations
Benefit obligations at December 31, 2018	$	33,373	$	137,417	$	3,948	$	3,897	$	29,488	$	24,097
Service cost		—		—		—		—		320		366
Interest cost		624		4,269		39		108		1,212		837
Actuarial (gain) loss(1)		300		(3,685)		186		(57)		(9,542)		4,957
Benefits paid		(34,297)		(105,522)		(937)		—		(848)		(769)
Settlement loss		—		894		—		—		—		—
Benefit obligations at December 31, 2019		—		33,373		3,236		3,948		20,630		29,488
Change in plan assets
Fair value of plan assets at December 31, 2018		26,646		124,831		—		—		—		—
Actual return on plan assets		(59)		1,837		—		—		—		—
Employer contributions		7,710		5,500		937		—		848		769
Benefits paid		(34,297)		(105,522)		(937)		—		(848)		(769)
Fair value of plan assets at December 31, 2019		—		26,646		—		—		—		—
Funded status at period end	$	—	$	(6,727)	$	(3,236)	$	(3,948)	$	(20,630)	$	(29,488)
Accumulated benefit obligation	$	—	$	33,373	$	3,236	$	3,948	$	20,630	$	29,488

(1) The actuarial gain on the nonunion defined benefit pension plan for 2018 was primarily due to an increase in the discount rate used to remeasure the plan obligation at December 31, 2018 versus December 31, 2017. The actuarial gain on the postretirement health benefit plan for 2019 is primarily related to the impact of a lower cost prescription drug plan effective January 1, 2020, versus the actuarial loss for 2018 which was primarily related to changes in the medical trend rate assumption used to measure the plan obligation at the measurement date.

Schedule of amounts recognized in the consolidated balance sheets related to nonunion defined benefit plans

Amounts recognized in the consolidated balance sheets at December 31 consisted of the following:

	Nonunion Defined				Supplemental				Postretirement
	Benefit Pension Plan				Benefit Plan				Health Benefit Plan
	2019		2018		2019		2018		2019		2018
	(in thousands)
Current portion of pension and postretirement liabilities	$	—	$	(6,727)	$	(2,886)	$	(937)	$	(686)	$	(995)
Pension and postretirement liabilities, less current portion		—		—		(350)		(3,011)		(19,944)		(28,493)
Liabilities recognized	$	—	$	(6,727)	$	(3,236)	$	(3,948)	$	(20,630)	$	(29,488)

Summary of the components of net periodic benefit cost

The following is a summary of the components of net periodic benefit cost for the Company’s nonunion benefit plans for the years ended December 31:

	Nonunion Defined						Supplemental						Postretirement
	Benefit Pension Plan						Benefit Plan						Health Benefit Plan
	2019		2018		2017		2019		2018		2017		2019		2018		2017
	(in thousands)
Service cost	$	—	$	—	$	—	$	—	$	—	$	—	$	320	$	366	$	489
Interest cost		624		4,269		4,514		39		108		102		1,212		837		1,060
Expected return on plan assets		(31)		(1,582)		(5,712)		—		—		—		—		—		—
Amortization of prior service credit		—		—		—		—		—		—		(33)		(93)		(190)
Pension settlement expense(1)		4,164		12,925		4,156		370		—		—		—		—		—
Amortization of net actuarial loss(2)		260		2,583		3,132		95		81		82		898		304		694
Net periodic benefit cost	$	5,017	$	18,195	$	6,090	$	504	$	189	$	184	$	2,397	$	1,414	$	2,053

(1) For 2019, the presentation of pension settlement expense excludes a $4.0 million noncash pension termination expense which is further described within this Note.

(2) The Company amortizes actuarial losses over the average remaining active service period of the plan participants and does not use a corridor approach.

Summary of pension settlement distributions and settlement expense

The following is a summary of the pension settlement distributions and pension settlement expense for the years ended December 31:

	Nonunion Defined						Supplemental
	Benefit Pension Plan						Benefit Plan
	2019(1)		2018(2)		2017(3)		2019(4)		2018		2017(5)
	(in thousands, except per share data)
Pension settlement distributions	$	33,938	$	105,279	$	26,261	$	937	$	—	$	989
Pension settlement expense, pre-tax(6)	$	4,164	$	12,925	$	4,156	$	370	$	—	$	—
Pension settlement expense per diluted share, net of taxes	$	0.12	$	0.36	$	0.10	$	0.01	$	—	$	—

(1) Pension settlement distributions for 2019 represent $18.4 million of lump-sum benefit distributions, including participant-elected distributions associated with the plan’s termination, a $14.0 million nonparticipating annuity contract purchase, and a $1.5 million transfer of benefit obligations to the PBGC.

(2) Pension settlement distributions for 2018 represent lump-sum benefit distributions, including participant-elected distributions associated with the plan’s termination.

(3) Pension settlement distributions for 2017 represent $18.7 million of lump-sum benefit distributions and a $7.6 million nonparticipating annuity contract purchase.

(4) The 2019 SBP distribution excludes the portion of the benefit related to an officer retirement which is delayed for six months after retirement in accordance with IRC Section 409A. The pension settlement expense related to the delayed distribution is recognized in 2019.

(5) The 2017 SBP distribution represents the portion of a benefit related to an officer retirement that occurred in 2016 which was delayed for six months after retirement in accordance with IRC Section 409A. The pension settlement expense related to this distribution was recognized in 2016.

(6) For 2019, the presentation of pension settlement expense excludes a $4.0 million noncash pension termination expense which is further described within this Note.

Pre-tax amounts included in accumulated other comprehensive loss that have not yet been recognized in net periodic benefit cost

Included in accumulated other comprehensive loss at December 31 were the following pre-tax amounts that have not yet been recognized in net periodic benefit cost:

	Nonunion Defined				Supplemental				Postretirement
	Benefit Pension Plan				Benefit Plan				Health Benefit Plan
	2019		2018		2019		2018		2019		2018
	(in thousands)
Unrecognized net actuarial (gain) loss	$	—	$	4,034	$	127	$	405	$	(3,024)	$	7,416
Unrecognized prior service credit		—		—		—		—		(1)		(34)
Total	$	—	$	4,034	$	127	$	405	$	(3,025)	$	7,382

Weighted-average assumptions used to determine benefit obligations and net periodic benefit cost for nonunion defined benefit plans

	Nonunion Defined			Supplemental				Postretirement
	Benefit Pension Plan			Benefit Plan				Health Benefit Plan
	2019	2018		2019		2018		2019		2018
Discount rate	N/A	3.9	%	2.4	%	3.6	%	3.1	%	4.2	%

Weighted-average assumptions used to determine net periodic benefit cost for the Company’s nonunion benefit plans for the years ended December 31 were as follows:

	Nonunion Defined						Supplemental						Postretirement
	Benefit Pension Plan						Benefit Plan						Health Benefit Plan
	2019(1)		2018(2)		2017(3)		2019		2018		2017		2019		2018		2017
Discount rate	3.9	%	3.1	%	3.4	%	3.6	%	2.8	%	2.7	%	4.2	%	3.5	%	4.0	%
Expected return on plan assets	1.4	%	1.4	%	6.5	%	N/A		N/A		N/A		N/A		N/A		N/A

(1) The discount rate presented was used to determine the first quarter 2019 expense, and the short-term discount rate established upon quarterly settlements in 2019 of 3.8% and 3.7%, was used to calculate the expense for the second and third quarter of 2019, respectively. The expected return on plan assets presented was used to determine nonunion pension expense for first quarter 2019, and a 0.0% expected return on plan assets was used to determine nonunion pension expense for the second and third quarters of 2019, as further discussed in the following Nonunion Defined Benefit Pension Plan Assets section within this Note.

(2) The discount rate presented was used to determine the first quarter 2018 credit, and the interim discount rate established upon each quarterly settlement in 2018 of 3.6%, 3.8%, and 3.6% was used to calculate the expense for the second, third, and fourth quarter of 2018, respectively.

(3) The discount rate presented was used to determine the first quarter 2017 credit, and the interim discount rate established upon each quarterly settlement in 2017 of 3.4%, 3.2%, and 3.1% was used to calculate the expense/credit for the second, third, and fourth quarter of 2017, respectively. The expected return on plan assets presented was used to determine the nonunion pension credit for the first half of 2017, and a 2.5% expected return on plan assets was used to determine nonunion pension expense for the second half of 2017, as further discussed in the following Nonunion Defined Benefit Pension Plan Assets section within this Note.

Schedule of the assumed health care cost trend rates for the postretirement health benefit plan

The assumed health care cost trend rates for the Company’s postretirement health benefit plan at December 31 were as follows:

	2019		2018
Health care cost trend rate assumed for next year(1)	7.5	%	8.0	%
Rate to which the cost trend rate is assumed to decline	5.0	%	5.0	%
Year that the rate reaches the cost trend assumed rate	2026		2026

(1) At each December 31 measurement date, health care cost rates for the following year are based on known premiums for the fully-insured postretirement health benefit plan. Therefore, the first year of assumed health care cost trend rates presented as of December 31, 2019 and 2018 are for 2021 and 2020, respectively.

Schedule of estimated future benefit payments for nonunion defined benefit plans

Estimated future benefit payments from the Company’s SBP and postretirement health benefit plans, which reflect expected future service as appropriate, as of December 31, 2019 are as follows:

	Supplemental		Postretirement
	Benefit		Health
	Plan		Benefit Plan
2020	$	2,886	$	686
2021	$	—	$	735
2022	$	—	$	754
2023	$	—	$	849
2024	$	—	$	815
2025-2029	$	424	$	4,428

Fair value of the nonunion defined benefit pension plan assets, by major asset category and fair value hierarchy level

The fair value of the Company’s nonunion defined benefit pension plan assets at December 31, 2018, by major asset category and fair value hierarchy level (see Fair Value Measurements accounting policy in Note B), were as follows:

			Fair Value Measurements Using
			Quoted Prices		Significant		Significant
			In Active		Observable		Unobservable
			Markets		Inputs		Inputs
	Total		(Level 1)		(Level 2)		(Level 3)
	(in thousands)
Cash and cash equivalents(1)	$	19,856	$	19,856	$	—	$	—
Debt instruments(2)		10		—		10		—
Floating rate loans(3)		6,780		6,780		—		—
Fair value of plan assets at December 31, 2018	$	26,646	$	26,636	$	10	$	—

(1) Consists primarily of money market mutual funds.

(2) Includes a debt income security which was liquidated subsequent to December 31, 2018. The sale price of the security was used to determine the fair value at December 31, 2018.

(3) Consists of a floating rate loan mutual fund.

Schedule of multiemployer pension funds and key participation information

		Pension		FIP/RP
		Protection Act		Status	Contributions (d)
	EIN/Pension	Zone Status (b)		Pending/	(in thousands)						Surcharge
Legal Name of Plan	Plan Number (a)	2019	2018	Implemented (c)	2019		2018		2017		Imposed (e)
Central States, Southeast and Southwest Areas Pension Plan(1)(2)	36-6044243	Critical and Declining	Critical and Declining	Implemented(3)	$	75,803	$	74,177	$	78,230	No
Western Conference of Teamsters Pension Plan(2)	91-6145047	Green	Green	No		24,860		25,268		26,320	No
Central Pennsylvania Teamsters Defined Benefit Plan(1)(2)	23-6262789	Green	Green	No		13,907		13,393		13,391	No
I. B. of T. Union Local No. 710 Pension Fund(5)(6)	36-2377656	Green(4)	Green(4)	No		10,164		9,929		10,054	No
New England Teamsters Pension Fund(7)(8)	04-6372430	Critical and Declining(9)	Critical and Declining(9)	Implemented(10)		4,802		20,090		5,026	No
All other plans in the aggregate						24,210		24,392		25,395
Total multiemployer pension contributions paid(11)					$	153,746	$	167,249	$	158,416

Table Heading Definitions

(a) The “EIN/Pension Plan Number” column provides the Federal Employer Identification Number (EIN) and the three-digit plan number, if applicable.

(b) Unless otherwise noted, the most recent PPA zone status available in 2019 and 2018 is for the plan’s year-end status at December 31, 2018 and 2017, respectively. The zone status is based on information received from the plan and was certified by the plan’s actuary. Green zone funds are those that are in neither endangered, critical, or critical and declining status and generally have a funded percentage of at least 80%.

(c) The “FIP/RP Status Pending/Implemented” column indicates if a funding improvement plan (FIP) or a rehabilitation plan (RP), if applicable, is pending or has been implemented.

(d) Amounts reflect contributions made in the respective year and differ from amounts expensed during the year.

(e) The surcharge column indicates if a surcharge was paid by ABF Freight to the plan.

(1) ABF Freight System, Inc. was listed by the plan as providing more than 5% of the total contributions to the plan for the plan years ended December 31, 2018 and 2017.

(2) Information for this fund was obtained from the annual funding notice, other notices received from the plan, and the Form 5500 filed for the plan years ended December 31, 2018 and 2017.

(3) Adopted a rehabilitation plan effective March 25, 2008 as updated. Utilized amortization extension granted by the IRS effective December 31, 2003.

(4) PPA zone status relates to plan years February 1, 2018 – January 31, 2019 and February 1, 2017 – January 31, 2018.

(5) The Company was listed by the plan as providing more than 5% of the total contributions to the plan for the plan years ended January 31, 2019 and 2018.

(6) Information for this fund was obtained from the annual funding notice, other notices received from the plan, and the Form 5500 filed for the plan years ended January 31, 2019 and 2018.

(7) Contributions include $1.6 million and $15.7 million for 2019 and 2018, respectively, related to the multiemployer pension fund withdrawal liability which is further discussed in this Note.

(8) Information for this fund was obtained from the annual funding notice, other notices received from the plan, and the Form 5500 filed for the plan years ended September 30, 2018 and 2017.

(9) PPA zone status relates to plan years October 1, 2018 – September 30, 2019 and October 1, 2017 – September 30, 2018.

(10) Adopted a rehabilitation plan effective January 1, 2009.

(11) Contribution levels can be impacted by several factors such as changes in business levels and the related time worked by contractual employees, contractual rate increases for pension benefits, and the specific funding structure, which differs among funds. The 2018 ABF NMFA and the related supplemental agreements provided for contributions to multiemployer pension plans to be frozen at the current rates for each fund. The year-over-year changes in multiemployer pension plan contributions presented above were influenced by the previously mentioned payments related to the New England Pension Fund and changes in Asset-Based business levels.