RETIREMENT PLANS AND RELATED POST RETIREMENT BENEFITS
|12 Months Ended|
Dec. 31, 2022
|Retirement Benefits [Abstract]|
|RETIREMENT PLANS AND RELATED POST RETIREMENT BENEFITS||RETIREMENT PLANS AND RELATED POST RETIREMENT BENEFITS
The Company has two non-qualified supplemental retirement defined benefit plans (“SERP” and “SERP II”) for certain current and retired executive officers. The accumulated benefit obligation of the plans as of December 31, 2022 and 2021 amounts to $20.5 million and $28.5 million, respectively.
The plans provide for benefits based upon average annual compensation and years of service and, in the case of SERP, there are offsets for social security and profit sharing benefits. It is the Company’s intent to fund the plans as plan benefits become payable, since no assets exist at December 31, 2022 or 2021 for either of the plans.
The Company accounts for the funded status (i.e., the difference between the fair value of plan assets and the projected benefit obligations) of its pension plans in accordance with the recognition and disclosure provisions of ASC Topic 715, Compensation, Retirement Benefits, which requires the Company to recognize the funded status in its balance sheet, with a corresponding adjustment to Accumulated Other Comprehensive Income (“AOCI”), net of tax. These amounts will be subsequently recognized as net periodic pension cost pursuant to the Company’s historical policy for amortizing such amounts. Further, actuarial gains and losses that arise in subsequent periods and are not recognized as net periodic pension cost in the same periods will be recognized as a component of AOCI. Those amounts will be subsequently recognized as a component of net periodic pension cost on the same basis as the amounts recognized in AOCI.
Unrecognized prior service costs of $1.0 million ($1.6 million net of $0.6 million in taxes) and unrecognized actuarial losses of $0.8 million ($2.4 million net of $1.6 million in taxes) are included in AOCI at December 31, 2022 and have not yet been recognized in net periodic pension cost.
The reconciliation of the beginning and ending balances of the projected benefit obligation of the plans for the years ended December 31 is as follows:
In 2022, the net actuarial gain of $4.9 million is due principally to the increase of 225 basis points in the discount rate used to measure the benefit obligation as of December 31, 2022 compared to the prior year. The assumptions used to calculate the projected benefit obligation as of December 31 are as follows:
The plans are unfunded at December 31, 2022 and are recognized in the accompanying Consolidated Balance Sheets as a current accrued pension liability of $0.3 million and a long-term accrued pension liability of $25.9 million. This also is the expected future contribution to the plan, since the plan is unfunded.
The service cost component of net periodic benefit cost is included in SG&A expenses, and all other net periodic benefit costs components (such as interest cost, prior service cost amortization and actuarial gain/loss amortization) are reported outside of operating income, within Other Expense, Net of Other Income in the accompanying Consolidated Statements of Operations.
The following table summarizes the components of the net periodic cost for the years ended December 31:
The assumptions used to determine the net periodic cost are as follows:
The Company expects the benefits to be paid in the next year to be $0.3 million, each of the next three years to be $0.6 million, $1.0 million in the year following, and $10.5 million in the aggregate for the next five years after that. This also is the expected Company contribution to the plans.
Participants in SERP are entitled to paid medical, dental and long-term care insurance benefits upon retirement under the plan. The measurement date for determining the plan obligation and cost is December 31. The accumulated postretirement benefit obligation is $0.8 million and $1.1 million for the years ended December 31, 2022 and 2021, respectively. The plan is recognized in the accompanying Consolidated Balance Sheets as a current accrued pension liability of $0.1 million and a long-
term accrued pension liability of $0.7 million. The net periodic cost for the years ended December 31, 2022, 2021 and 2020 is immaterial.
The Company also has a defined benefit plan related to its subsidiary in France. The measurement date for determining the plan obligation and cost is December 31. The defined benefit plan has an overfunded asset of $0.1 million and an unfunded liability of $0.3 million for the years ended December 31, 2022 and 2021, respectively. The plan is recognized in the accompanying Consolidated Balance Sheets as a long-term asset and long-term liability, respectively. The net periodic cost for the years ended December 31, 2022, 2021 and 2020 is immaterial.
The Company is a participating employer in a trustee-managed multiemployer defined benefit pension plan for employees who participate in collective bargaining agreements. The plan generally provides retirement benefits to employees based on years of service to the Company. Contributions are based on the hours worked and are expensed on a current basis. The plan is 98.0% funded as of January 1, 2022. The Company’s contributions to the plan were $0.5 million in 2022, $0.4 million in 2021 and $0.5 million in 2020. These contributions represent less than 1% of total contributions to the plan.
No definition available.
The entire disclosure for retirement benefits.
Reference 1: http://www.xbrl.org/2003/role/exampleRef