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Retirement Plans | 12 Months Ended
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Dec. 31, 2024
Retirement Benefits [Abstract] |
Retirement Plans | 12. Retirement Plans We have a noncontributory defined benefit pension plan that, prior to July 1, 2005, covered substantially all of our domestic employees who had attained a specified age and one year of employment. Benefits under the plan were based on years of service and salary history. In 2005, we amended our defined benefit pension plan to freeze the accrual of future benefits for all U.S. employees, effective on July 1, 2005. Since the plan is frozen, there is no difference between the projected benefit obligation and accumulated benefit obligation at December 31, 2024 and 2023. Through the acquisition of the partnership interests of BCHR holdings, L.P. and its subsidiaries dba Buck (which we refer to as Buck), we acquired the assets and assumed the liabilities associated with three frozen defined benefit pension plans that provide postretirement benefits to their participants located in the U.S., U.K. and Canada (which we refer to as the Buck Pension Plans). The Buck Pension Plans were amended to freeze benefit plan accruals for all participants (closed to new entrants and existing participants do not accrue any additional benefits) effective December 31, 2014. Effective December 31, 2024, the U.S. Buck Pension Plan was merged into our defined benefit pension plan. In January 2025, we notified plan participates that we will fully terminate such plan. In first quarter 2025, we will initiate the wind down of the plan and we expect to complete such wind down by settling all future obligations under the plan through a combination of lump sum payments to eligible, electing participants and transferring the remaining liability through the purchase of a group annuity contract to a highly-rated third-party insurance company. We expect that the wind down will be completed in fourth quarter 2025. Based on estimates as of December 31, 2024, we anticipate recognizing a non-cash, pre-tax loss of approximately $34.2 million in fourth quarter 2025 to compensation expense in the consolidated statement of earnings that may be offset by an approximately $12.8 million adjustment to consolidated statement of comprehensive earnings, a $16.5 million write‑down of a prepaid pension asset and a $4.6 million reversal of a deferred tax asset. In the table below, the service cost component represents plan administration costs that are incurred directly by the plan. A reconciliation of the beginning and ending balances of the pension benefit obligation and fair value of plan assets and the funded status of the plan is as follows (in millions):
|  | Year Ended December 31, |
|  | 2024 |  |  | 2023 |
Change in pension benefit obligation: |  |  |  |  |  |
Benefit obligation at beginning of year |  | $ | 216.0 |  |  | $ | 211.9 |
Service cost |  |  | 0.6 |  |  |  | 3.3 |
Interest cost |  |  | 9.9 |  |  |  | 10.7 |
Merger of the Buck U.S. pension plan |  |  | 95.4 |  |  |  | — |
Net actuarial loss (gain) |  |  | (10.5 | ) |  |  | 8.8 |
Benefits paid |  |  | (15.4 | ) |  |  | (18.7 | )
Benefit obligation at end of year |  | $ | 296.0 |  |  | $ | 216.0 |
Change in plan assets: |  |  |  |  |  |
Fair value of plan assets at beginning of year |  | $ | 228.9 |  |  | $ | 212.5 |
Actual (loss) return on plan assets |  |  | 15.3 |  |  |  | 35.1 |
Merger of the Buck U.S. pension plan |  |  | 83.7 |  |  |  | — |
Contributions by the Company |  |  | — |  |  |  | — |
Benefits paid |  |  | (15.4 | ) |  |  | (18.7 | )
Fair value of plan assets at end of year |  | $ | 312.5 |  |  | $ | 228.9 |
Funded status of the plan (underfunded) |  | $ | 16.5 |  |  | $ | 12.9 |
Amounts recognized in the consolidated balance sheet consist of: |  |  |  |  |  |
Noncurrent assets - prepaid pension asset |  | $ | 16.5 |  |  | $ | 12.9 |
Accumulated other comprehensive income |  |  | 17.7 |  |  |  | 37.3 |
Net amount included in retained earnings |  | $ | 34.2 |  |  | $ | 50.2 |
The components of the net periodic pension benefit cost for the plan and other changes in plan assets and obligations recognized in earnings and other comprehensive earnings consist of the following (in millions):
|  | Year Ended December 31, |
|  | 2024 |  |  | 2023 |  |  | 2022 |
Net periodic pension cost: |  |  |  |  |  |  |  |  |
Service cost |  | $ | 0.6 |  |  | $ | 3.3 |  |  | $ | 0.5 |
Interest cost on benefit obligation |  |  | 9.9 |  |  |  | 10.7 |  |  |  | 6.8 |
Expected return on plan assets |  |  | (15.4 | ) |  |  | (14.2 | ) |  |  | (19.1 | )
Amortization of net loss |  |  | 2.5 |  |  |  | 4.9 |  |  |  | 2.4 |
Net periodic benefit income (cost) |  |  | (2.4 | ) |  |  | 4.7 |  |  |  | (9.4 | )
Other changes in plan assets and obligations recognized in other comprehensive earnings: |  |  |  |  |  |  |  |  |
Net loss (gain) incurred |  |  | (10.3 | ) |  |  | (12.0 | ) |  |  | 14.1 |
Amortization of net loss |  |  | (2.5 | ) |  |  | (4.9 | ) |  |  | (2.4 | )
Total recognized in other comprehensive income (loss) |  |  | (12.8 | ) |  |  | (16.9 | ) |  |  | 11.7 |
Total recognized in net periodic pension cost and other comprehensive income (loss) |  | $ | (15.2 | ) |  | $ | (12.2 | ) |  | $ | 2.3 |
The following weighted average assumptions were used at December 31 in determining the plan’s pension benefit obligation:
|  | December 31, |
|  | 2024 |  |  | 2023 |
Discount rate |  |  | 5.50 | % |  |  | 4.75 | %
Weighted average expected long-term rate of return on plan assets |  |  | 7.00 | % |  |  | 7.00 | %
The following weighted average assumptions were used at January 1 in determining the plan’s net periodic pension benefit cost:
|  | Year Ended December 31, |
|  | 2024 |  |  | 2023 |  |  | 2022 |
Discount rate |  |  | 4.75 | % |  |  | 5.25 | % |  |  | 2.50 | %
Weighted average expected long-term rate of return on plan assets |  |  | 7.00 | % |  |  | 7.00 | % |  |  | 7.00 | %
The following benefit payments are expected to be paid by the plan (in millions):
2025 |  | $ | 25.2 |
2026 |  |  | 22.1 |
2027 |  |  | 22.5 |
2028 |  |  | 22.5 |
2029 |  |  | 22.6 |
2030 to 2034 |  |  | 448.5 |
The following is a summary of the plan’s weighted average asset at December 31 by asset category:
|  | December 31, |
Asset Category |  | 2024 |  |  | 2023 |
Equity securities |  |  | 0.0 | % |  |  | 61.0 | %
Debt securities |  |  | 100.0 | % |  |  | 32.0 | %
Real estate |  |  | 0.0 | % |  |  | 7.0 | %
Total |  |  | 100.0 | % |  |  | 100.0 | %
Plan assets are invested in various pooled separate accounts under annuity contracts managed by two life underwriting enterprises. The plan’s investment policy provides that investments will be allocated in a manner designed to provide a long‑term investment return greater than the actuarial assumptions, maximize investment return commensurate with risk and to comply with the Employee Income Retirement Security Act of 1974, as amended (which we refer to as ERISA), by investing the funds in a manner consistent with ERISA’s fiduciary standards. The weighted average expected long-term rate of return on plan assets assumption was determined based on a review of the asset allocation strategy of the plan using expected ten-year return assumptions for all of the asset classes in which the plan was invested at December 31, 2024 and 2023. The return assumptions used in the valuation were based on data provided by the plan’s external investment advisors. The following is a summary of the plan’s assets carried at fair value as of December 31 by level within the fair value hierarchy (in millions):
|  | December 31, |
Fair Value Hierarchy |  | 2024 |  |  | 2023 |
Level 1 |  | $ | — |  |  | $ | — |
Level 2 |  |  | 205.7 |  |  |  | 120.3 |
Level 3 |  |  | 106.8 |  |  |  | 108.6 |
Total fair value |  | $ | 312.5 |  |  | $ | 228.9 |
The plan’s Level 2 assets consist of ownership interests in various pooled separate accounts within a life insurance carrier’s group annuity contract. The fair value of the pooled separate accounts is determined based on the net asset value of the respective funds, which is obtained from the underwriting enterprise and determined each business day with issuances and redemptions of units of the funds made based on the net asset value per unit as determined on the valuation date. We have not adjusted the net asset values provided by the underwriting enterprise. There are no restrictions as to the plan’s ability to redeem its investment at the net asset value of the respective funds as of the reporting date. The plan’s Level 3 assets consist of pooled separate accounts within another life insurance carrier’s annuity contracts for which fair value has been determined by an independent valuation. Due to the nature of these annuity contracts, our management makes assumptions to determine how a market participant would price these Level 3 assets. In determining fair value, the future cash flows to be generated by the annuity contracts were estimated using the underlying benefit provisions specified in each contract, market participant assumptions and various actuarial and financial models. These cash flows were then discounted to present value using a risk-adjusted rate that takes into consideration market based rates of return and probability-weighted present values. The following is a reconciliation of the beginning and ending balances for the Level 3 assets of the plan measured at fair value (in millions):
|  | Year Ended December 31, |
|  | 2024 |  |  | 2023 |
Fair value at January 1 |  | $ | 108.6 |  |  | $ | 99.6 |
Settlements |  |  | (10.6 | ) |  |  | (1.4 | )
Unrealized gain |  |  | 8.8 |  |  |  | 10.4 |
Fair value at December 31 |  | $ | 106.8 |  |  | $ | 108.6 |
We were no t required under the IRC to make any minimum contributions to the plan for each of the 2024, 2023 and 2022 plan years. This level of required funding is based on the plan being frozen and the aggregate amount of our historical funding. During 2024, 2023 and 2022 we did no t make discretionary contributions to the plan. We comply with the minimum funding requirements in the U.S., U.K. and Canada and will make annual contributions to the Buck Pension Plans consistent with those funding requirements. We recognize the funded status of the Buck Pension Plans, measured as the difference between the fair value of the plan assets and the projected benefit obligation, in the accompanying December 31, 2024 and 2023 consolidated balance sheets. As of December 31, 2023, the funded/(unfunded) status related to the Buck Pension Plans was $(21.6) million in the U.S., $10.8 million in the U.K. and $(1.3) million in Canada and have been recorded in other noncurrent assets and liabilities. We also have a qualified contributory savings and thrift 401(k) plan covering the majority of our domestic employees. For eligible employees who have met the plan’s age and service requirements to receive matching contributions, we historically have matched 100% of pre-tax and Roth elective deferrals up to a maximum of 5.0% of eligible compensation, subject to federal limits on plan contributions and not in excess of the maximum amount deductible for federal income tax purposes. Beginning in 2021, the amount matched by the Company will be discretionary and annually determined by management. Employees must be employed and eligible for the plan on the last day of the plan year to receive a matching contribution, subject to certain exceptions enumerated in the plan document. Matching contributions are subject to a five-year graduated vesting schedule and can be funded in cash or common stock of the Company. We expensed (net of plan forfeitures) $105.4 million, $86.0 million and $73.8 million related to the plan in 2024, 2023 and 2022 respectively. During 2022 and 2023, management determined the 5.0% employer matching contributions on eligible compensation to the 401(k) plan for the 2022 and 2023 plan years to be funded with our common stock, which were funded in February 2023 and 2024, respectively. During 2024, management determined the 5.0% employer matching contributions on eligible compensation to the 401(k) plan for the 2024 plan year would be funded with our common stock, which is expected to be funded in February 2025. We also have a nonqualified deferred compensation plan, the Supplemental Savings and Thrift Plan, for certain employees who, due to IRS rules, cannot take full advantage of our matching contributions under the 401(k) plan. The plan permits these employees to annually elect to defer a portion of their compensation until their retirement or a future date. Our matching contributions to this plan (up to a maximum of the lesser of a participant’s elective deferral of base salary, annual bonus and commissions or 5.0% of eligible compensation, less matching amounts contributed under the 401(k) plan) are also discretionary and annually determined by management. Matching contributions can be funded in cash or common stock of the Company. We expensed $14.3 million, $12.3 million and $11.0 million related to contributions made to a rabbi trust maintained under the plan in 2024, 2023 and 2022, respectively. During 2024, management determined the 5.0% employer matching contributions on eligible compensation to the plan for the 2024 plan year would be funded with our common stock, which is expected to be funded in February 2025. The fair value of the assets in the plan’s rabbi trust at December 31, 2024 and 2023, including employee contributions and investment earnings, was $909.1 million and $728.4 million, respectively, and has been included in other noncurrent assets and the corresponding liability has been included in other noncurrent liabilities in the accompanying consolidated balance sheet. We also have several foreign benefit plans, the largest of which is a defined contribution plan that provides for us to make contributions of 5.0% of eligible compensation. In addition, the plan allows for voluntary contributions by U.K. employees, which we match 100%, up to a maximum of an additional 5.0% of eligible compensation. Net expense for foreign retirement plans amounted to $92.6 million, $76.7 million and $62.9 million in 2024, 2023 and 2022, respectively.

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