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Defined Benefit Pension Plans
 12 Months Ended
Dec. 31, 2022
Text Block [Abstract]  
Defined Benefit Pension Plans Defined Benefit Pension Plans
At December 31, 2022, the Company’s pension plans consisted of the U.S. pension plans, which includes the Hanesbrands Inc. Legacy Pension Plan and the Hanesbrands Inc. Pension Plan (together, the “U.S. Pension Plans”), various nonqualified retirement plans and international plans, which include certain defined benefit plans acquired in connection with the purchases of Champion Europe and Hanes Australasia. Benefits under the U.S Pension Plans were frozen effective December 31, 2005. Effective December 1, 2022, the Company spun-off the majority of participants in the Hanesbrands Inc. Pension Plan into a new, separate plan, the Hanesbrands Inc. Legacy Pension Plan. A small number of participants remained in the Hanesbrands Inc. Pension Plan, representing approximately 1% of the total participants and 1% of the total projected benefit obligation.
The components of net periodic benefit cost and other amounts recognized in other comprehensive income (loss) of the Company’s noncontributory defined benefit pension plans were as follows:
 
 Years Ended
 December 31,
2022		January 1,
2022		January 2,
2021
Service cost$1,345 $1,488 $1,406 
Interest cost27,669 23,812 33,552 
Expected return on assets(49,189)(45,923)(42,278)
Settlement cost(6)861 121 
Amortization of:
Prior service cost(6)(6)(6)
Net actuarial loss20,972 24,440 22,277 
Net periodic benefit cost$785 $4,672 $15,072 
Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income (Loss)
Net (gain) loss$(130,000)$(96,334)$38,484 
Prior service credit6 6 6 
Total (gain) loss recognized in other comprehensive income (loss)(129,994)(96,328)38,490 
Total recognized in net periodic benefit cost and other comprehensive income (loss)$(129,209)$(91,656)$53,562 
The funded status of the Company’s defined benefit pension plans at the respective year ends was as follows:
 
December 31,
2022		January 1,
2022
Benefit obligation:
Beginning of year$1,216,161 $1,299,943 
Service cost1,345 1,488 
Interest cost27,669 23,812 
Benefits paid(64,786)(62,525)
Settlements(125)(2,072)
Impact of exchange rate change(2,603)(1,128)
Actuarial gain(251,426)(43,325)
Other(36)(32)
End of year926,199 1,216,161 
Fair value of plan assets:
Beginning of year973,598 920,316 
Actual return on plan assets(93,497)73,567 
Employer contributions2,831 44,658 
Benefits paid(64,786)(62,525)
Settlements(125)(2,072)
Impact of exchange rate change(1,741)(314)
Other(36)(32)
End of year816,244 973,598 
Funded status$(109,955)$(242,563)
The actuarial gain in 2022 and 2021 included in benefit obligations was primarily driven by increases in the U.S. discount rate assumptions.
As most of the Company’s pension plans are frozen, the accumulated benefit obligation (“ABO”) approximates the benefit obligation. The total benefit obligation and the benefit obligation and fair value of plan assets for the Company’s pension plans with benefit obligations in excess of plan assets are as follows:
 
December 31,
2022		January 1,
2022
Benefit obligation$926,199 $1,216,161 
Plans with benefit obligation in excess of plan assets:
Benefit obligation905,749 1,188,558 
Fair value of plan assets790,641 942,733 
Amounts recognized in the Company’s Consolidated Balance Sheets consist of:
 
December 31,
2022		January 1,
2022
Other noncurrent assets$5,153 $3,262 
Accrued liabilities and other: Payroll and employee benefits(2,388)(2,225)
Pension and postretirement benefits(112,720)(243,600)
Accumulated other comprehensive loss(440,529)(570,523)
Amounts recognized in accumulated other comprehensive loss consist of:
 
December 31,
2022		January 1,
2022
Prior service cost$(133)$(139)
Actuarial loss440,662 570,662 
Accumulated other comprehensive loss$440,529 $570,523 
(a) Measurement Date and Assumptions
A December 31 measurement date is used to value plan assets and obligations for the pension plans. In determining the discount rate, the Company utilizes a full yield curve approach in the calculation of the plan obligation and interest cost and service cost components of net periodic benefit cost. The specific spot rates along the yield curve are applied to the relevant projected cash flows, and single equivalent discount rates are shown for disclosure purposes. The expected long-term rate of return on plan assets was based on the Company’s investment policy target allocation of the asset portfolio among various asset classes and the expected real returns of each asset class over various periods of time. The weighted average actuarial assumptions used in measuring the net periodic benefit cost and plan obligations for the periods presented were as follows:
 
December 31,
2022		January 1,
2022		January 2,
2021
Net periodic benefit cost:
Discount rate2.88 %2.55 %3.25 %
Long-term rate of return on plan assets5.24 4.95 4.97 
Rate of compensation increase(1)
3.09 3.10 3.07 
Interest crediting rate5.50 5.50 5.50 
Plan obligations:
Discount rate5.15 %2.88 %2.55 %
Rate of compensation increase(1)
3.08 3.09 3.10 
Interest crediting rate5.50 5.50 5.50 
(1)For December 31, 2022, January 1, 2022 and January 2, 2021, the compensation assumption only applies to certain international plans as the benefits of the U.S. pension plans are now all frozen.
(b) Plan Assets, Expected Benefit Payments, and Funding
The allocation of pension plan assets as of the respective period end measurement dates is as follows:
 
December 31,
2022		January 1,
2022
Asset category:
Hedge fund of funds39 %37 %
Foreign equity securities21 22 
U.S. equity securities19 21 
Debt securities10 11 
Real estate8 6 
Commodities2 3 
Cash and other1 0 
The Company’s asset strategy and primary investment objective are to maximize the principal value of the plan assets to meet current and future benefit obligations to plan participants and their beneficiaries. To accomplish this goal, the assets of the plan are broadly diversified to protect against large investment losses and to reduce the likelihood of excessive volatility of returns. Diversification of assets is achieved through strategic allocations to various asset classes, as well as various investment styles within these asset classes, and by retaining multiple, third-party investment management firms with complementary investment styles and philosophies to implement these allocations. The Company has established a target asset allocation based upon analysis of risk/return trade-offs and correlations of asset mixes given long-term historical data, prospective capital market returns and forecasted liabilities of the plans. The target asset allocation approximates the actual asset allocation as of December 31, 2022. In addition to volatility protection, diversification enables the assets of the plan the best opportunity to provide adequate returns in order to meet the Company’s investment return objectives. These objectives include, over a rolling five-year period, to achieve a total return that exceeds the required actuarial rate of return for the plan and to outperform a passive portfolio, consisting of a similar asset allocation.
The Company utilizes market data or assumptions that market participants would use in pricing the pension plan assets. The Level 1 assets consisted primarily of certain U.S. equity securities, certain foreign equity securities, certain debt securities
and cash and cash equivalents. Certain foreign equity securities, debt securities, insurance contracts and commodity investments measured at their net asset value, which is determined based on inputs readily available in public markets, and investments in hedge funds of funds and real estate investments that are based on unobservable inputs about which little or no market data exists and are measured at a net asset value per share shall not be categorized within the fair value hierarchy. Refer to Note “Fair Value of Assets and Liabilities” for the Company’s complete disclosure of the fair value of pension plan assets.
Expected benefit payments are as follows: $66,272 in 2023, $66,619 in 2024, $67,295 in 2025, $68,302 in 2026, $69,553 in 2027 and $340,853 in 2028 through 2032.
The Company has no required cash contribution to its U.S. Pension Plans in 2023 based on a preliminary calculation by its actuary. The Company made no cash contributions to its U.S. Pension Plans in 2022. Prior to the plan spin-off described above, on January 4, 2021, the Company made a contribution of $40,000 to the U.S. Pension Plans.
(c) Nonretirement Postemployment Benefit Plans
Certain of the international plans, specifically those acquired in connection with the purchase of Champion Europe, are in substance nonretirement postemployment benefit plans, which are future liabilities funded through future operational results of the Company. However, for purposes of consolidation, the Company is including these plans within the defined benefit reporting. At December 31, 2022 and January 1, 2022, the total amounts accrued for these plans were $871 and $1,171, respectively and the total expense was $9, $8 and $16 for 2022, 2021 and 2020, respectively.