Company-Sponsored Employee Benefit Plans (Company-Sponsored Employee Benefit Plans [Member])

6 Months Ended

Dec. 29, 2012

Company-Sponsored Employee Benefit Plans [Member]

Defined Benefit Plan Disclosure [Line Items]

Employee Benefit Plans

6.  COMPANY-SPONSORED EMPLOYEE BENEFIT PLANS 

The components of net company-sponsored benefit cost for the 13-week periods presented are as follows.  The caption “Pension Benefits” in the table below includes both the company-sponsored qualified pension plan (Retirement Plan) and the Supplemental Executive Retirement Plan (SERP). 

	Pension Benefits				Other Postretirement Plans
	Dec. 29, 2012		Dec. 31, 2011		Dec. 29, 2012		Dec. 31, 2011
	(In thousands)
Service cost	$	17,589	$	27,056	$	136	$	114
Interest cost		37,253		36,878		153		158
Expected return on plan assets		(42,800)		(40,402)		-		-
Amortization of prior service cost		2,273		1,201		42		54
Amortization of actuarial loss (gain)		18,328		15,042		(51)		(83)
Amortization of transition obligation		-		-		36		38
Curtailment loss		8,293		-		-		-
Net periodic benefit cost	$	40,936	$	39,775	$	316	$	281

The components of net company-sponsored benefit cost for the 26-week periods are as follows:

	Pension Benefits				Other Postretirement Plans
	Dec. 29, 2012		Dec. 31, 2011		Dec. 29, 2012		Dec. 31, 2011
	(In thousands)
Service cost	$	35,369	$	54,111	$	271	$	228
Interest cost		74,953		73,757		307		316
Expected return on plan assets		(85,601)		(80,803)		-		-
Amortization of prior service cost		3,734		2,402		84		108
Recognized net actuarial loss (gain)		37,350		30,083		(102)		(166)
Amortization of transition obligation		-		-		71		76
Curtailment loss		8,293		-		-		-
Net periodic benefit cost	$	74,098	$	79,550	$	631	$	562

At the end of fiscal 2012, Sysco approved a plan to freeze future benefit accruals under the Retirement Plan as of December 31, 2012 for all United States-based salaried and non-union hourly employees.  Effective January 1, 2013, these employees are eligible for additional contributions under the company’s defined contribution 401(k) plan.  The measurements for the Retirement Plan at June 30, 2012 and the resulting expense for fiscal 2013 included the impact of the freeze. 

In November 2012, Sysco approved a plan to restructure its executive nonqualified retirement program including the SERP.   Future benefit accruals will have frozen under this plan by June 29, 2013 for all participants.   As a result of this change, the liabilities of this plan were remeasured using a discount rate of 3.96%.  A curtailment gain of $73.0 million was recognized as a component of actuarial losses (net of tax) within other comprehensive income with an offsetting reduction to benefits obligations to accumulated benefits.  Further, an $8.3 million loss was recognized in the income statement arising from the write-off of prior service costs.  In addition to the plan freeze, participants will be fully vested in their frozen benefits on their date of freeze.  This resulted in an increase in the benefit obligation of $48.6 million which was reflected as unrecognized prior service cost in other comprehensive income.  This amount will amortize into pension expense over the next seven years.  The SERP benefit obligation resulting after these changes on the date of the approved plan was $486.6 million.

Sysco’s contributions to its company-sponsored defined benefit plans were $11.3 million and $11.1 million during the 26-week periods ended December 29, 2012 and December 31, 2011, respectively.