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Pension and Other Postretirement Benefits
 12 Months Ended
Dec. 31, 2023
Retirement Benefits [Abstract]  
Pension and Other Postretirement Benefits Pension and Other Postretirement Benefits
 
The accounting standards related to employers’ accounting for defined benefit pension and other postretirement plans requires the Company to recognize the funded status of its defined benefit postretirement plans as assets or liabilities in the accompanying consolidated balance sheets and to recognize changes in the funded status of the plans in comprehensive income.

The Company has various defined contribution plans, the largest of which is its Retirement Savings Plan. Most U.S. salaried and non-union hourly employees are eligible to participate in this plan. See Note 17 for further discussion of the Retirement Savings Plan. The Company also maintains various other defined contribution plans which cover certain other employees. Company contributions under certain of these plans are based on the performance of the business units and employee compensation. Contribution expense under these other defined contribution plans was $3,030, $4,870 and $5,475 in 2023, 2022 and 2021, respectively.

Defined benefit pension plans in the U.S. cover a majority of the Company’s U.S. employees at the Motion Control Solutions business of Industrial, certain former U.S. employees, including retirees, and a portion of employees at the Company’s Corporate Office. Employees at certain international businesses within Industrial are also covered by defined benefit pension plans. Plan benefits for salaried and non-union hourly employees are based on years of service and average salary. Plans covering union hourly employees provide benefits based on years of service. The Company funds U.S. pension costs in accordance with the Employee Retirement Income Security Act of 1974, as amended (“ERISA”). Non-U.S. defined benefit pension plans cover certain employees of certain international locations in Europe and Canada.
 
The Company provides other medical, dental and life insurance postretirement benefits for certain of its retired employees in the U.S. and Canada. It is the Company’s practice to fund these benefits as incurred.
 
The accompanying balance sheets reflect the funded status of the Company’s defined benefit pension plans at December 31, 2023 and 2022. Reconciliations of the obligations and funded status of the plans follow:
 
 20232022
 U.S.Non-U.S.TotalU.S.Non-U.S.Total
Benefit obligation, January 1$341,595 $60,711 $402,306 $442,756 $89,460 $532,216 
Service cost1,646 943 2,589 3,869 1,820 5,689 
Interest cost17,343 2,072 19,415 13,144 964 14,108 
Amendments— (2,553)(2,553)121 — 121 
Actuarial loss (gain)3,615 4,985 8,600 (94,516)(23,739)(118,255)
Benefits paid(31,097)(2,542)(33,639)(24,882)(2,592)(27,474)
Transfers in— 1,989 1,989 — 2,694 2,694 
Plan curtailments(7,602)(437)(8,039)708 — 708 
Plan settlements— (12,799)(12,799)— (4,527)(4,527)
Special termination benefits— — — 395 — 395 
Participant contributions— 906 906 — 1,034 1,034 
Foreign exchange rate changes— 4,101 4,101 — (4,403)(4,403)
Benefit obligation, December 31325,500 57,376 382,876 341,595 60,711 402,306 
Fair value of plan assets, January 1304,881 70,039 374,920 422,563 87,366 509,929 
Actual return on plan assets34,046 4,207 38,253 (95,573)(10,275)(105,848)
Company contributions8,605 1,119 9,724 2,773 1,321 4,094 
Participant contributions— 906 906 — 1,034 1,034 
Benefits paid(31,097)(2,542)(33,639)(24,882)(2,592)(27,474)
Plan settlements— (12,799)(12,799)— (4,527)(4,527)
Transfers in— 1,989 1,989 — 2,694 2,694 
Foreign exchange rate changes— 4,212 4,212 — (4,982)(4,982)
Fair value of plan assets, December 31316,435 67,131 383,566 304,881 70,039 374,920 
(Underfunded) Overfunded status, December 31$(9,065)$9,755 $690 $(36,714)$9,328 $(27,386)

Benefit obligations decreased in 2023 primarily due to a plan curtailment resulting from the Company electing to freeze the benefits associated with one of its U.S-based defined benefit pension plans in February 2023 and an increase in the payment of benefits to plan participants, partially offset by higher interest costs throughout 2023 and actuarial losses as compared with actuarial gains in the comparable 2022 period, resulting primarily from decreases in the discount rate as of December 31, 2023.

Benefit obligations decreased in 2022 primarily due to actuarial gains, resulting largely from increases in the discount rate, and the payment of benefits to plan participants, partially offset by interest costs.

Projected benefit obligations related to pension plans with benefit obligations in excess of plan assets follow:
 20232022
 U.S.Non-U.S.TotalU.S.Non-U.S.Total
Projected benefit obligation$34,578 $31,514 $66,092 $268,811 $34,820 $303,631 
Fair value of plan assets4,301 28,701 33,002 226,866 33,856 260,722 
 
Information related to pension plans with accumulated benefit obligations in excess of plan assets follows:
 20232022
 U.S.Non-U.S.TotalU.S.Non-U.S.Total
Accumulated benefit obligation$34,744 $31,241 $65,985 $46,267 $34,762 $81,029 
Fair value of plan assets4,301 28,701 33,002 9,813 33,856 43,669 
 
The accumulated benefit obligation for all defined benefit pension plans was $382,769 and $395,663 at December 31, 2023 and 2022, respectively.
Amounts related to pensions recognized in the accompanying balance sheets consist of:
 20232022
 U.S.Non-U.S.TotalU.S.Non-U.S.Total
Other assets$21,212 $12,568 $33,780 $5,231 $10,292 $15,523 
Accrued liabilities5,809 — 5,809 8,369 — 8,369 
Accrued retirement benefits24,468 2,813 27,281 33,576 964 34,540 
Accumulated other non-owner changes to equity, net(98,436)(4,811)(103,247)(108,265)(2,636)(110,901)
 
Amounts related to pensions recognized in accumulated other non-owner changes to equity, net of tax, at December 31, 2023 and 2022, respectively, consist of:
 20232022
 U.S.Non-U.S.TotalU.S.Non-U.S.Total
Net actuarial loss$(97,325)$(6,596)$(103,921)$(106,887)$(2,131)$(109,018)
Prior service costs(1,111)1,785 674 (1,378)(505)(1,883)
$(98,436)$(4,811)$(103,247)$(108,265)$(2,636)$(110,901)
 
The accompanying balance sheets reflect the underfunded status of the Company’s other postretirement benefit plans at December 31, 2023 and 2022. Reconciliations of the obligations and underfunded status of the plans follow:
 
20232022
Benefit obligation, January 1$21,964 $29,839 
Service cost39 77 
Interest cost1,122 808 
Actuarial gain(411)(6,375)
Benefits paid(2,390)(2,597)
Participant contributions98 141 
Foreign exchange rate changes19 71 
Benefit obligation, December 3120,441 21,964 
Fair value of plan assets, January 1— — 
Company contributions2,292 2,456 
Participant contributions98 141 
Benefits paid(2,390)(2,597)
Fair value of plan assets, December 31— — 
Underfunded status, December 31$20,441 $21,964 

Benefit obligations decreased in 2023 and 2022 primarily due to the payment of benefits to plan participants, partially offset by interest costs.
 
Amounts related to other postretirement benefits recognized in the accompanying balance sheets consist of:
20232022
Accrued liabilities$2,315 $2,630 
Accrued retirement benefits18,126 19,334 
Accumulated other non-owner changes to equity, net2,471 2,261 
Amounts related to other postretirement benefits recognized in accumulated other non-owner changes to equity, net of tax, at December 31, 2023 and 2022 consist of:
20232022
Net actuarial gain$2,471 $2,269 
Prior service loss— (8)
$2,471 $2,261 
 
The sources of changes in accumulated other non-owner changes to equity, net, during 2023 were: 
PensionOther
Postretirement
Benefits
Prior service cost$2,169 $— 
Net gain5,022 310 
Amortization of prior service costs229 8 
Amortization of actuarial loss (gain)511 (114)
Foreign exchange rate changes(277)6 
$7,654 $210 

Weighted-average assumptions used to determine benefit obligations as of December 31, are:
20232022
U.S. plans:
Discount rate5.45 %5.50 %
Increase in compensation— %3.05 %
Non-U.S. plans:
Discount rate3.00 %3.60 %
Increase in compensation2.56 %2.76 %
Interest crediting rate2.27 %2.01 %

The investment strategy of the plans is to generate a consistent total investment return sufficient to pay present and future plan benefits to retirees, while minimizing the long-term cost to the Company. Target allocations for asset categories are used to earn a reasonable rate of return, provide required liquidity and minimize the risk of large losses. Targets may be adjusted, as necessary, to reflect trends and developments within the overall investment environment. The weighted-average target investment allocations by asset category were as follows during 2023: 65% in equity securities and 35% in fixed income securities, including cash.
The fair values of the Company’s pension plan assets at December 31, 2023 and 2022 by asset category are as follows:
  Fair Value Measurements Using
Asset CategoryTotalQuoted Prices in
Active Markets for
Identical Assets
(Level 1)		Significant Other
Observable Inputs
(Level 2)		Significant
Unobservable
Inputs
(Level 3)
December 31, 2023
Cash and short-term investments$4,472 $4,472 $— $— 
Equity securities:
U.S. large-cap36,614 — 36,614 — 
U.S. mid-cap14,344 14,344 — — 
U.S. small-cap14,661 14,661 — — 
International equities107,176 — 107,176 — 
Global equity41,810 41,810 — — 
Fixed income securities:
U.S. bond funds104,791 — 104,791 — 
International bonds57,569 — 57,569 — 
Other2,129 — — 2,129 
$383,566 $75,287 $306,150 $2,129 
December 31, 2022
Cash and short-term investments3,542 3,542 — — 
Equity securities:
U.S. large-cap35,734 — 35,734 — 
U.S. mid-cap14,205 14,205 — — 
U.S. small-cap14,622 14,622 — — 
International equities104,377 — 104,377 — 
Global equity42,154 42,154 — — 
Fixed income securities:
U.S. bond funds97,170 — 97,170 — 
       International bonds61,295 — 61,295 — 
Other1,821 — — 1,821 
$374,920 $74,523 $298,576 $1,821 
 
The fair values of the Level 1 assets are based on quoted market prices from various financial exchanges. The fair values of the Level 2 assets are based primarily on quoted prices in active markets for similar assets or liabilities. The Level 2 assets are comprised primarily of commingled equity funds and fixed income securities. Commingled equity funds are valued at their net asset values based on quoted market prices of the underlying assets. Fixed income securities are valued using a market approach which considers observable market data for the underlying asset or securities. The Level 3 assets relate to a defined benefit plan within the Molding Solutions business. These pension assets are fully insured and have been estimated based on accrued pension rights and actuarial rates. These pension assets are limited to fulfilling the Company's pension obligations.
 
The Company expects to contribute approximately $7,143 to the pension plans in 2024. No contributions to the U.S. Qualified pension plans, specifically, are required, and the Company does not currently plan to make any discretionary contributions to such plans in 2024.
    
The following are the estimated future net benefit payments, which include future service, over the next 10 years:
PensionsOther
Postretirement
Benefits
2024$32,143 $2,315 
202532,315 2,163 
202632,589 2,018 
202728,431 1,894 
202828,791 1,793 
Years 2029-2033
135,554 7,632 
Total$289,823 $17,815 
 
Pension and other postretirement benefit costs consist of the following:
 PensionsOther
Postretirement Benefits
 202320222021202320222021
Service cost$2,589 $5,689 $6,547 $39 $77 $103 
Interest cost19,415 14,108 12,749 1,122 808 819 
Expected return on plan assets(30,056)(28,944)(27,858)— — — 
Amortization of prior service cost 354 387 332 10 36 29 
Recognized losses/(gains)1,643 12,710 16,006 (146)(2)258 
Curtailment (gain)/loss(668)1,158 (133)— — — 
Settlement (gain)/loss(656)(605)205 — — — 
Special termination benefits— 395 — — — — 
Net periodic benefit cost$(7,379)$4,898 $7,848 $1,025 $919 $1,209 
 
The curtailment gain of $668 and a majority of the settlement gain of $656 in 2023 as well as the curtailment loss of $1,158 and a portion of the special termination benefits of $395 in 2022 relate to restructuring and workforce reduction actions that were taken during the periods. See Note 9.

The components of net periodic benefit cost other than service cost are included in Other Expense (Income) on the Consolidated Statements of Income.
Weighted-average assumptions used to determine net periodic benefit cost for years ended December 31 are:
 
202320222021
U.S. plans:
Discount rate5.50 %2.95 %2.65 %
Long-term rate of return7.75 %7.25 %7.25 %
Increase in compensation3.05 %3.03 %2.56 %
Non-U.S. plans:
Discount rate3.60 %1.17 %0.83 %
Long-term rate of return3.99 %2.33 %1.96 %
Increase in compensation2.76 %2.77 %2.75 %
Interest crediting rate2.01 %1.34 %1.34 %
 
The expected long-term rate of return is based on consideration of projected rates of return and the historical rates of return of published indices that reflect the plans’ target asset allocation.
The Company’s accumulated postretirement benefit obligations, exclusive of pensions, take into account certain cost-sharing provisions. The annual rate of increase in the cost of covered benefits (i.e., health care cost trend rate) is assumed to be 6.98% and 7.52% at December 31, 2023 and 2022, respectively, decreasing gradually to a rate of 4.00% by December 31, 2046.

The Company actively contributes to a Swedish pension plan that supplements the Swedish social insurance system. The pension plan guarantees employees a pension based on a percentage of their salary and represents a multi-employer pension plan, however the pension plan was not significant in any year presented. This pension plan is not underfunded.