Employee benefit plans

12 Months Ended

Dec. 28, 2012

Employee benefit plans [Abstract]

Employee benefit plans

(9)           Employee benefit plans

We maintain defined benefit pension plans for certain U.S. and non-U.S. employees.  Benefits are based on years of service and average final compensation.  For our U.S. plans, we fund at least the minimum amount required by the Employee Retirement Income Security Act of 1974, as amended.  We do not provide any post-retirement benefits outside of the U.S., except as may be required by certain foreign jurisdictions.  Depending on the investment performance of our plan assets and other contributing factors, funding in a given year may not be required.

Our net pension cost/ (income) related to our defined benefit plans was $0.1 million, $(0.8) million and $1.1 million in the years ended December 28, 2012, December 30, 2011 and December 31, 2010, respectively, which included the following components (in thousands):

	2012			2011			2010
Service cost	$	--		$	38		$	296
Interest cost		1,685			1,811			1,860
Expected return on plan assets		(1,615	)		(2,496	)		(2,290	)
Amortization of transition obligation		5			5			5
Amortization of prior service costs		1			3			17
Recognized actuarial gains		--			(26	)		--
Curtailment gains		(18	)		(152	)		(1,031	)
Special termination benefits		--			--			2,225
Net periodic pension cost (income)	$	58		$	(817	)	$	1,082

Included in the $0.8 million of pension income recorded during the year ended December 30, 2011 was a curtailment gain of approximately $0.2 million related to one of our non-U.S. defined benefit retirement plans. For the year ended December 31, 2010, we incurred approximately $2.2 million of special termination benefits related to the settlement of our defined benefit executive supplemental retirement plan that was triggered by the sale of Electrical. These charges were allocated to our discontinued operations in the Consolidated Statement of Operations for the year ended December 31, 2010. Also, included in the net pension cost for the year ended December 31, 2010 was a curtailment gain of approximately $1.0 million related to our domestic defined benefit retirement plan, which was caused by the freezing of benefits under such plan at December 31, 2010.

The financial status of our defined benefit plans at December 28, 2012 and December 30, 2011 was as follows (in thousands):

	2012				2011
Change in benefit obligation:
Projected benefit obligation at beginning of year		$	38,195			$	34,628
Service cost			--				38
Interest cost			1,685				1,811
Actuarial losses			2,969				3,699
Benefits paid			(2,152	)			(1,934	)
Plan curtailments			(61	)			(47	)
Projected benefit obligation at end of year		$	40,636			$	38,195
Change in fair value of plan assets:
Fair value of plan assets at beginning of year		$	33,569			$	32,459
Actual return on plan assets			3,592				2,880
Employer contributions			108				164
Benefits paid			(2,152	)			(1,934	)
Fair value of plan assets at end of year		$	35,117			$	33,569
Amounts recognized on the Consolidated Balance Sheets:
Non-current assets		$	235			$	181
Non-current liabilities			(5,754	)			(4,807	)
Net amount recorded		$	(5,519	)		$	(4,626	)

The accumulated benefit obligations for the defined pension plans were $40.2 million and $37.5 million as of December 28, 2012 and December 30, 2011, respectively.  The unrecognized components of our net periodic pension costs have been included in accumulated other comprehensive income.  For the years ended December 28, 2012 and December 30, 2011, the accumulated other comprehensive income for our defined benefit plans included the following components (in thousands):

	2012			2011
Actuarial losses	$	(4,027	)	$	(3,096	)
Plan curtailment		(84	)		(84	)
Amortization of prior service costs		(20	)		(21	)
Amortization of transition obligations		(7	)		(10	)
Accumulated other comprehensive income	$	(4,138	)	$	(3,211	)

The pension cost to be amortized from accumulated other comprehensive income in 2013 related to our defined benefit pension plans is expected to be less than $0.1 million.

The aggregate benefit obligation, accumulated benefit obligation and fair value of plan assets for plans with benefit obligations in excess of plan assets as of December 28, 2012 and December 30, 2011 were as follows (in thousands):

	2012		2011
Projected benefit obligation	$	40,477	$	37,833
Accumulated benefit obligation	$	40,384	$	37,725
Plan assets	$	34,723	$	33,026

We expect to contribute approximately $1.1 million to our defined benefit plans in 2013.  Additionally, we expect to make benefit payments in 2013 of approximately $2.1 million from our defined benefit plans.

Our domestic defined benefit retirement plan has been subject to a claim by the Pension Benefit Guarantee Corporation ("PBGC") relating to the sale of our Electrical segment in 2010. Communications from the PBGC have indicated that the sale of Electrical's North America operations may have resulted in a partial plan termination. In February 2013, we had preliminary discussions with the PBGC whereby we offered to make periodic payments through fiscal 2019 to fund the plan by $6.2 million. The potential additional funding would have no impact on the liability recorded as of December 28, 2012.There can be no assurance that the final terms of any agreement reached with the PBGC will reflect the terms offered by the Company in these preliminary discussions.

The defined benefit plans' weighted-average asset allocations at December 28, 2012 and December 30, 2011 were as follows:

Asset category:	2012			2011
Equity securities		11	%		10	%
Fixed income securities		89	%		88	%
Other		0	%		2	%
Total		100	%		100	%

Our asset allocation policy is reviewed at least quarterly. Factors considered when determining the appropriate asset allocation include changes in plan liabilities, an evaluation of market conditions, and possible payment of additional benefits, potential plan termination and tolerance for risk and cash requirements for benefit payments.

A summary of our pension assets that are measured and recorded at fair value on a recurring basis and their level within the fair value hierarchy as of December 28, 2012 is as follows (in millions):

	2012		Quoted Prices In Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Plan assets per asset category (1):
Cash and cash equivalents	$	0.1	$	0.1	$	--	$	--
Fixed income securities:
Corporate bonds (2)		30.8		30.8		--		--
Short-term debt securities (3)		0.5		0.5		--		--
Equity securities:
Domestic small-cap value (4)		1.1		1.1		--		--
Domestic mid-cap value (5)		2.1		2.1		--		--
International diversified value (6)		0.5		0.5		--		--
Fair value of plan assets	$	35.1	$	35.1	$	--	$	--

A summary of our pension assets that are measured and recorded at fair value on a recurring basis and their level within the fair value hierarchy as of December 30, 2011 is as follows (in millions):

	2011		Quoted Prices In Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Plan assets per asset category (1):
Cash and cash equivalents	$	0.1	$	0.1	$	--	$	--
Fixed income securities:
Corporate bonds (2)		29.1		29.1		--		--
Short-term debt securities (3)		1.0		1.0		--		--
Equity securities:
Domestic small-cap value (4)		1.0		1.0		--		--
Domestic mid-cap value (5)		1.9		1.9		--		--
International diversified value (6)		0.5		0.5		--		--
Fair value of plan assets	$	33.6	$	33.6	$	--	$	--

(1) See Note 15, Fair Value Measurements, for a description of the three levels within the fair value hierarchy.

(2) Debt securities that specialize in investment grade bonds of institutional investors and other treasury related securities.

(3) Generally, money market securities that maintain cash for interim purchases.

(4) Equity securities that focus on international public companies with low market capitalization.

(5) Equity securities that focus on international public companies with a mid-rated market capitalization.

(6) Equity securities that focus on international public companies but diversify their market capitalization to limit investment.

Our discount rate assumption is determined based on high-quality fixed income investments that match the duration of our expected benefit payments.  For our pension obligations in the United States, a yield curve constructed from a portfolio of high quality corporate debt securities with varying maturities is used to discount our expected benefit payments to their present value.  This generates our discount rate assumption for our domestic pension plans.  For our non-U.S. plans, we use the market rates for high quality corporate bonds to derive our discount rate assumption.  To develop our expected long-term rate of return on assets assumption, we considered historical returns and future expectations for returns of each asset class, weighted by the target asset allocations.  

The assumptions used to develop our defined benefit plan data were as follows:

	2012			2011
Discount rate		4.1	%		4.6	%
Annual compensation increases		N/A			N/A
Expected long-term rates of return on plan assets		5.0	%		8.0	%

Our measurement date is the last day of the calendar year.

The following table shows our expected benefit payments for the next five fiscal years and the aggregate five years thereafter from our defined benefit plans (in thousands):

Year Ending
2013	$	2,054
2014		2,055
2015		2,054
2016		2,137
2017		2,161
Thereafter		30,176

Some of our non-U.S. subsidiaries have defined contribution pension plans which provide benefits for substantially all of their employees.  The net pension expense pertaining to these plans included in our results of operations for the years ended December 28, 2012, December 30, 2011 and December 31, 2010 were $1.1 million, $1.2 million and $2.6 million, respectively.

We maintain a defined contribution 401(k) plan that covers substantially all of our U.S. employees.  The total contribution expense under the 401(k) plan was approximately $0.9 million, $1.0 million and $0.3 million in 2012, 2011 and 2010, respectively. During 2009, we amended these plans and temporarily suspended employer matching contributions.  However, the matching contribution was fully reinstated at the beginning of our 2011 fiscal year.