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Pension Plans and Other Retirement Benefits | 12 Months Ended
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Feb. 03, 2024
Retirement Benefits [Abstract] |
Pension Plans and Other Retirement Benefits | Pension Plans and Other Retirement Benefits Pension TJX has a funded defined benefit retirement plan that covers eligible U.S. employees hired prior to February 1, 2006. No employee contributions are required, or permitted, and benefits are based principally on compensation earned in each year of service. TJX’s funded defined benefit retirement plan assets are invested in domestic and international equity and fixed income securities, both directly and through investment funds. The plan does not invest in TJX securities. TJX also has an unfunded supplemental retirement plan that covers certain key employees and provides additional retirement benefits based on final average compensation for certain of those employees (the “primary benefit”) or, alternatively, based on benefits that would be provided under the funded retirement plan absent Internal Revenue Code limitations (the “alternative benefit”). Presented below is financial information relating to TJX’s funded defined benefit pension plan (“qualified pension plan” or “funded plan”) and its unfunded supplemental pension plan (“unfunded plan”) for the fiscal years indicated. The Company has elected the practical expedient pursuant to ASU 2015-4–Compensation-retirement benefits (Topic 715) and has selected the measurement date of January 31, the calendar month end closest to the Company’s fiscal year-end.
| Funded Plan Fiscal Year Ended | Unfunded Plan Fiscal Year Ended
In millions | February 3, 2024 | January 28, 2023 | February 3, 2024 | January 28, 2023
Change in projected benefit obligation: |  |  |  |
Projected benefit obligation at beginning of year | $ | 1,343 |  | $ | 1,717 |  | $ | 109 |  | $ | 114 |
Service cost | 33 |  | 48 |  | 2 |  | 2 |
Interest cost | 72 |  | 58 |  | 6 |  | 4 |
Actuarial losses (gains) | (37) |  | (442) |  | 0 |  | (9) |
Benefits paid | (111) |  | (35) |  | (12) |  | (2) |
Expenses paid | (4) |  | (3) |  | — |  | — |
Plan amendments | (11) |  | — |  | — |  | — |
Projected benefit obligation at end of year | $ | 1,285 |  | $ | 1,343 |  | $ | 105 |  | $ | 109 |
Accumulated benefit obligation at end of year | $ | 1,187 |  | $ | 1,241 |  | $ | 92 |  | $ | 93 |
| Funded Plan Fiscal Year Ended | Unfunded Plan Fiscal Year Ended
In millions | February 3, 2024 | January 28, 2023 | February 3, 2024 | January 28, 2023
Change in plan assets: |  |  |  |
Fair value of plan assets at beginning of year | $ | 1,475 |  | $ | 1,713 |  | $ | — |  | $ | — |
Actual return on plan assets | 91 |  | (200) |  | — |  | — |
Employer contribution | 0 |  | 0 |  | 12 |  | 2 |
Benefits paid | (111) |  | (35) |  | (12) |  | (2) |
Expenses paid | (4) |  | (3) |  | — |  | — |
Fair value of plan assets at end of year | $ | 1,451 |  | $ | 1,475 |  | $ | — |  | $ | — |
Reconciliation of funded status: |  |  |  |
Projected benefit obligation at end of year | $ | 1,285 |  | $ | 1,343 |  | $ | 105 |  | $ | 109 |
Fair value of plan assets at end of year | 1,451 |  | 1,475 |  | — |  | — |
Funded status – excess (asset) obligation | $ | (166) |  | $ | (132) |  | $ | 105 |  | $ | 109 |
Net (asset) liability recognized on Consolidated Balance Sheets | $ | (166) |  | $ | (132) |  | $ | 105 |  | $ | 109 |
Amounts not yet reflected in net periodic benefit cost and included in Accumulated other comprehensive (loss) income: |  |  |  |
Prior service cost | $ | (11) |  | $ | 0 |  | $ | — |  | $ | — |
Accumulated actuarial losses | 78 |  | 126 |  | 17 |  | 19 |
Amounts included in Accumulated other comprehensive (loss) income | $ | 67 |  | $ | 126 |  | $ | 17 |  | $ | 19 |
The Consolidated Balance Sheets reflect the funded status of the plans with any unrecognized prior service cost and actuarial gains and losses recorded in Accumulated other comprehensive (loss) income. The funded plan asset of $166 million and $132 million is reflected on the Consolidated Balance Sheets in Prepaid expenses and other current assets as of February 3, 2024 and January 28, 2023, respectively. The unfunded plan liability is reflected on the Consolidated Balance Sheets as current liabilities of $10 million and $4 million and a long-term liability of $95 million and $105 million as of February 3, 2024 and January 28, 2023, respectively. The decrease in the actuarial losses included in Accumulated other comprehensive (loss) income for the funded plan for fiscal 2024 was driven by the impact of higher discount rates and an increase in actual return on plan assets. TJX determined the assumed discount rate using the BOND: Link model in fiscal 2024 and fiscal 2023. TJX uses the BOND: Link model as this model allows for the selection of specific bonds resulting in better matches in timing of the plans’ expected cash flows. Presented below are weighted average assumptions for measurement purposes for determining the obligation at the year-end measurement date:
| Funded Plan Fiscal Year Ended | Unfunded Plan Fiscal Year Ended
| February 3, 2024 | January 28, 2023 | February 3, 2024 | January 28, 2023
Discount rate | 5.70 | % | 5.40 | % | 5.80 | % | 5.60 | %
Rate of compensation increase | 4.00 | % | 4.00 | % | 4.00 | % | 4.00 | %
TJX made aggregate cash contributions of $12 million in fiscal 2024 and $3 million in fiscal 2023 to the funded plan and to fund current benefit and expense payments under the unfunded plan. TJX’s policy with respect to the funded plan is to fund, at a minimum, the amount required to maintain a funded status of 80% of the applicable pension liability (the Funding Target pursuant to the Internal Revenue Code section 430) or such other amount as is sufficient to avoid restrictions with respect to the funding of nonqualified plans under the Internal Revenue Code. The Company does not anticipate any required funding in fiscal 2025 for the funded plan. The Company anticipates making contributions of $11 million to provide current benefits coming due under the unfunded plan in fiscal 2025. The following are the components of net periodic benefit cost and other amounts recognized in Other comprehensive income (loss) related to the Company’s pension plans:
| Funded Plan Fiscal Year Ended | Unfunded Plan Fiscal Year Ended
In millions | February 3, 2024 | January 28, 2023 | January 29, 2022 | February 3, 2024 | January 28, 2023 | January 29, 2022
Net periodic pension cost: |  |  |  |  |  |
Service cost | $ | 33 |  | $ | 48 |  | $ | 49 |  | $ | 2 |  | $ | 2 |  | $ | 2 |
Interest cost | 72 |  | 58 |  | 52 |  | 6 |  | 4 |  | 3 |
Expected return on plan assets | (80) |  | (89) |  | (95) |  | — |  | — |  | — |
Amortization of prior service cost | 0 |  | 0 |  | 0 |  | — |  | — |  | — |
Amortization of net actuarial loss | — |  | 18 |  | 14 |  | 2 |  | 4 |  | 4 |
Total expense | $ | 25 |  | $ | 35 |  | $ | 20 |  | $ | 10 |  | $ | 10 |  | $ | 9 |
Other changes in plan assets and benefit obligations recognized in other comprehensive income: |  |  |  |  |
Net (gain) loss | $ | (48) |  | $ | (153) |  | $ | 66 |  | $ | 0 |  | $ | (9) |  | $ | 0 |
Prior service cost (credit) | (11) |  | — |  | — |  | — |  | — |  | — |
Amortization of net (loss) | — |  | (18) |  | (14) |  | (2) |  | (4) |  | (4) |
Amortization of prior service cost | 0 |  | 0 |  | 0 |  | — |  | — |  | — |
Total (gain) loss recognized in other comprehensive income | $ | (59) |  | $ | (171) |  | $ | 52 |  | $ | (2) |  | $ | (13) |  | $ | (4) |
Total recognized in net periodic benefit cost and other comprehensive income (loss) | $ | (34) |  | $ | (136) |  | $ | 72 |  | $ | 8 |  | $ | (3) |  | $ | 5 |
Weighted average assumptions for expense purposes: |  |  |  |  |
Discount rate | 5.40 | % | 3.40 | % | 3.20 | % | 5.60 | % | 3.30 | % | 2.80 | %
Expected rate of return on plan assets | 5.50 | % | 5.25 | % | 5.75 | % | N/A | N/A | N/A
Rate of compensation increase | 4.00 | % | 4.00 | % | 4.00 | % | 4.00 | % | 4.00 | % | 4.00 | %
TJX develops its long-term rate of return assumption by evaluating input from professional advisors taking into account the asset allocation of the portfolio and long-term asset class return expectations, as well as long-term inflation assumptions. The unrecognized gains and losses in excess of 10% of the projected benefit obligation are amortized over the average remaining service life of participants. The following is a schedule of the benefits expected to be paid in each of the next five fiscal years and in the aggregate for the five fiscal years thereafter:
In millions | Funded Plan Expected Benefit Payments | Unfunded Plan Expected Benefit Payments
Fiscal Year: |  |
2025 | $ | 85 |  | $ | 11 |
2026 | 89 |  | 46 |
2027 | 93 |  | 7 |
2028 | 96 |  | 9 |
2029 | 98 |  | 10 |
2030 through 2034 | 518 |  | 43 |
The following tables present the fair value hierarchy for pension assets measured at fair value on a recurring basis:
| Funded Plan at February 3, 2024
In millions | Level 1 | Level 2 | Total
Asset category: |  |  |
Short-term investments | $ | 43 |  | $ | — |  | $ | 43 |
Equity Securities | 49 |  | — |  | 49 |
Fixed Income Securities: |  |  |
Corporate and government bond funds | — |  | 1,024 |  | 1,024 |
Futures Contracts | — |  | (4) |  | (4) |
Total assets in the fair value hierarchy | $ | 92 |  | $ | 1,020 |  | $ | 1,112 |
Assets measured at net asset value(a) | — |  | — |  | 339 |
Fair value of assets | $ | 92 |  | $ | 1,020 |  | $ | 1,451 |
| Funded Plan at January 28, 2023
In millions | Level 1 | Level 2 | Total
Asset category: |  |  |
Short-term investments | $ | 9 |  | $ | — |  | $ | 9 |
Equity Securities | 163 |  | — |  | 163 |
Fixed Income Securities: |  |  |
Corporate and government bond funds | — |  | 882 |  | 882 |
Futures Contracts | — |  | (4) |  | (4) |
Total assets in the fair value hierarchy | $ | 172 |  | $ | 878 |  | $ | 1,050 |
Assets measured at net asset value(a) | — |  | — |  | 425 |
Fair value of assets | $ | 172 |  | $ | 878 |  | $ | 1,475 |
(a)In accordance with Subtopic 820-10, certain investments that were measured using net asset value per share (or its equivalent) as a practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the fair value of assets presented above. Pension plan assets are reported at fair value. Refer to Note F—Fair Value Measurements for further information on the fair value hierarchy. Investments in equity securities traded on a national securities exchange are valued at the composite close price, as reported in the Wall Street Journal, as of the financial statement date. This information is provided by independent pricing sources. Short-term investments are primarily cash related to funding of the plan which had yet to be invested as of balance sheet dates. Certain corporate and government bonds are valued at the closing price reported in the active market in which the bond is traded. Other bonds are valued based on yields currently available on comparable securities of issuers with similar credit ratings. When quoted prices are not available for identical or similar bonds, the bond is valued under a discounted cash flow approach that maximizes observable inputs, such as current yields of similar instruments, but includes adjustments for certain risks that may not be observable, such as credit and liquidity risks. All bonds are priced by independent pricing sources. Assets measured at net asset value include investments in limited partnerships, which are stated at the fair value of the plan’s partnership interest based on information supplied by the partnerships as compared to financial statements of the limited partnership or other fair value information as determined by management. Cash equivalents or short-term investments are stated at cost which approximates fair value, and the fair value of common/collective trusts is determined based on net asset value as reported by their fund managers. Following is the asset allocation under the qualified pension plan as of the valuation date for the fiscal years presented:
| February 3, 2024 | January 28, 2023
Return-seeking assets | 32 | % | 46 | %
Liability-hedging assets | 65 | % | 54 | %
All other – primarily cash | 3 | % | 0 | %
Under TJX’s investment policy, qualified pension plan assets are to be invested with the objective of generating investment returns that, in combination with funding contributions, provide adequate assets to meet all current and reasonably anticipated future benefit obligations under the plan. The investment policy includes a dynamic asset allocation strategy, whereby, over time, in connection with improvements in the plan’s funded status, the target allocation of return-seeking assets (generally, equities and other instruments with a similar risk profile) may decline and the target allocation of liability-hedging assets (generally, fixed income and other instruments with a similar risk profile) may increase. Under the investment policy guidelines, the target asset allocation of return-seeking assets and liability-hedging assets was 36% and 64%, respectively, as of February 3, 2024. Risks are sought to be mitigated through asset diversification and the use of multiple investment managers. Investment risk is measured and monitored on an ongoing basis through investment portfolio reviews, annual liability measurements and periodic asset/liability studies. In the second quarter of fiscal 2024, the Company announced that it would offer eligible former TJX associates who have not yet commenced their qualified pension plan benefit an opportunity to receive a voluntary lump sum payout of their pension plan benefit. At the end of the offer period during fiscal 2024, the payout amount, based on participation rate, did not meet the threshold to record a non-cash settlement charge. Other Retirement Benefits TJX also sponsors an employee savings plan under Section 401(k) of the Internal Revenue Code for eligible U.S. employees and a similar type of plan for eligible employees in Puerto Rico. Employees may contribute up to 50% of eligible pay, subject to limitations. For eligible employees who have completed the applicable service requirement, TJX matches employee contributions, up to 5% of eligible pay, at rates of 25% or 75% (based upon date of hire and other eligibility criteria), and may make additional discretionary year-end contributions based on TJX’s performance. TJX may also make additional discretionary non-matching contributions. Certain eligible employees are automatically enrolled in the U.S. Plan and the Puerto Rico savings plan at a 2% deferral rate, unless the employee elects otherwise. The total cost of TJX contributions to these plans was $103 million in fiscal 2024, $77 million in fiscal 2023 and $83 million in fiscal 2022. TJX also has a nonqualified savings plan (the Executive Savings Plan) for certain U.S. employees. TJX matches employee deferrals at various rates which amounted to $9 million in fiscal 2024, $6 million in fiscal 2023 and $7 million in fiscal 2022. Although the plan is unfunded, in order to help meet its future obligations TJX transfers an amount generally equal to employee deferrals and the related company match to a separate “rabbi” trust. The trust assets, which are invested in a variety of mutual funds, are included in other assets on the balance sheets. In addition to the plans described above, TJX also contributes to retirement/deferred savings programs for eligible Associates at certain of its foreign subsidiaries. The Company contributed $32 million for these programs in fiscal 2024, $29 million for these programs in fiscal 2023 and $26 million in fiscal 2022. Multiemployer Pension Plans TJX contributes to certain multiemployer defined benefit pension plans under the terms of collective-bargaining agreements that cover union-represented employees. TJX contributed $27 million in fiscal 2024, and $25 million in both fiscal 2023 and fiscal 2022 to the Legacy Plan of the National Retirement Fund (EIN #13-6130178, plan #1), the Adjustable Plan of the National Retirement Fund (EIN #13-6130178, plan #2), the Legacy Plan of the UNITE HERE Retirement Fund (EIN #82-0994119, plan #1) and the Adjustable Plan of the UNITE HERE Retirement Fund (EIN #82-0994119, plan #2). TJX was listed in the Form 5500 for the Legacy Plan of the National Retirement Fund and the Adjustable Plan of the National Retirement Fund as providing more than 5% of the total contributions, or being one of the top ten highest contributors, for the plan year ending December 31, 2022. In addition, based on information available to TJX, the Pension Protection Act Zone status for the Legacy Plan of the National Retirement Fund is critical and for the Legacy Plan of the UNITE HERE Retirement Fund is critical and declining, and rehabilitation plans have been adopted by these plans. The risks of participating in multiemployer pension plans are different from the risks of single-employer pension plans in certain respects, including the following: (a) assets contributed to the multiemployer plan by one employer may be used to provide benefits to employees of other participating employers; (b) if a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers; (c) if TJX ceases to have an obligation to contribute to a multiemployer plan in which the Company had been a contributing employer, or in certain other circumstances, the Company may be required to pay to the plan an amount based on the Company’s allocable share of the underfunded status of the plan, referred to as a withdrawal liability.

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