13. EMPLOYEE BENEFIT PLANS

Employee Retirement Savings Plans

We have various qualified employee retirement savings plans. Participants can contribute certain amounts to the plans and we match a certain portion of employee contributions. We contributed approximately $5.0 million, $6.3 million and $6.4 million to the plans for the fiscal years ended June 30, 2017, 2018 and 2019, respectively.

Deferred Compensation Plan

We have a deferred compensation plan, which meets the requirements for deferred compensation under Section 409A of the Internal Revenue Code. The plan provides that selected employees are eligible to defer up to 80% of their salaries and up to 100% of their bonuses. We may also make employer contributions to participant accounts in certain circumstances. The benefits under this plan are unsecured. Participants are generally eligible to receive payment of their vested benefit at the end of their elected deferral period or after termination of their employment for any reason or at a later date to comply with the restrictions of Section 409A. Discretionary company contributions and the related earnings are subject to a vesting schedule dependent upon years of service to us and, also, vest completely upon the participant’s disability or death while employed by us or immediately prior to a change of control. We made contributions of $0.6 million, $0.5 million and $0.5 million during fiscal year 2017, 2018 and 2019, respectively. As of June 30, 2019, we held assets of $25.3 million and liabilities of $24.9 million related to this plan. Assets related to this plan are included in other assets and liabilities related to this plan are included in other long-term liabilities in the consolidated balance sheets. The plan liabilities include accrued employer contributions not yet funded to the plan.

Employee Pension Plans

We sponsor a number of qualified and nonqualified pension plans for our employees at certain locations. In accordance with accounting standards for employee pension and postretirement benefits, we fully recognize the overfunded or underfunded status of each of our defined benefit plans as an asset or liability in the consolidated balance sheets. The asset or liability equals the difference between the fair value of the plans’ assets and their benefit obligations. The liabilities associated with underfunded plans are classified as noncurrent, except to the extent the fair value of the plans’ assets is less than the plans’ estimated benefit payments over the next 12 months. We measure our pension and postretirement benefit plans’ assets and benefit obligations as of June 30.

The following provides a reconciliation of the changes in the plans’ benefit obligations and fair value of assets for fiscal years 2018 and 2019, and a statement of the funded status as of June 30, 2018 and 2019 (in thousands):


	2018		2019
Change in Benefit Obligation
Benefit obligation at beginning of year	$	13,726	$	13,780
Translation adjustment		57		(166)
Interest costs		467		457
Service costs		—		223
Curtailment		(369)		—
Actuarial (gain) loss		61		(82)
Benefits paid		(162)		(153)
Benefit obligation at end of year		13,780		14,059
Change in Plan Assets
Fair value of plan assets at beginning of year		5,555		5,870
Translation adjustment		43		(183)
Actual return on plan assets		388		201
Benefits paid		(116)		(107)
Fair value of plan assets at end of year		5,870		5,781
Funded status and net amount recognized	$	(7,910)	$	(8,278)
Amount recognized in consolidated balance sheets consists of:
Investments	$	1,065	$	1,034
Accrued pension liability		(8,975)		(9,312)
Accumulated other comprehensive income		1,202		1,019

The following table provides the net periodic benefit costs for the fiscal years ended June 30, (in thousands):


	2017		2018		2019
Net Periodic Benefit Costs
Interest costs	$	453	$	467	$	457
Service costs		—		—		223
Expected return on plan assets		(200)		(203)		(270)
Amortization of prior service costs		279		249		56
Recognized actuarial loss		317		305		103
Net periodic benefit cost	$	849	$	818	$	569

Plan Assumptions


	2018		2019
Weighted average assumptions at year-end:
Discount rate	3.4	%	3.2	%
Expected return on plan assets	4.7	%	4.4	%
Rate of compensation increase	3.0	%	2.9	%

The long term return on assets has been derived from the weighted average of assumed returns on each of the major asset categories. The weighted average is based on the actual proportion of each major asset class held, rather than a benchmark portfolio of assets. The expected returns for each major asset class have been derived from a combination of both historical market returns and current market data as well as the views of a range of investment managers.

Plan Assets and Investment Policy


	Fiscal year ended				Fiscal year ended
	June 30, 2018				June 30, 2019
	Proportion of		Expected Rate		Proportion of		Expected Rate
	Fair Value		of Return		Fair Value		of Return
Equity securities	83	%	6	%	82	%	5	%
Debt securities	17	%	1	%	17	%	1	%
Cash	—	%	—	%	1	%	—	%
Combined	100	%	4.7	%	100	%	4.4	%

The defined benefit plans’ assets are invested in a range of pooled investment funds that provide access to a diverse range of asset classes. The investment objective is to maximize the investment return over the long term without exposing the fund to an unnecessary level of risk. Within this objective, it is recognized that benefits will be secured by the purchase of annuities at the time of employee retirement.

The benchmark is to hold assets in both equity and debt securities. The proportion in each investment class is not mandated and is allowed to fluctuate with market movements. The equity holdings are maintained in balanced funds under the control of investment managers.

Day-to-day equities selection decisions are delegated to investment managers, although these are monitored against performance and risk targets. Due to the nature of the pooled funds, there are no significant holdings in any single company (greater than 5% of the total assets). The investment strategy is reviewed on a regular basis, based on the results of third-party liability studies.

Projected Benefit Payments

The following table reflects estimated benefits payments, based upon the same assumptions used to measure the benefit obligation and net pension cost, as of June 30, 2019 (in thousands):


		Pension Benefits
July 1, 2019 to June 30, 2020		122
July 1, 2020 to June 30, 2021		135
July 1, 2021 to June 30, 2022		138
July 1, 2022 to June 30, 2023		159
July 1, 2023 to June 30, 2024		5,803
July 1, 2024 to June 30, 2029		5,616

Company Contribution

As of June 30, 2019, our weighted average contribution rate is under 1% of pensionable salaries. No company contributions are expected for fiscal 2020.