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(22) Retirement Benefit Plans | 12 Months Ended
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Jan. 01, 2012
Retirement Benefit Plans [Abstract] |
Retirement Benefit Plans | Retirement Benefit Plans 401(k) Plans Subject to certain restrictions, the Companies have a 401(k) defined contribution plan (the “401(k) Plan”) for all of its employees who meet certain minimum requirements and elect to participate. Effective January 1, 2010, there were prior existing 401(k) plans (the “Prior Plans”) that were combined into the 401(k) Plan. The 401(k) Plan permits employees to contribute up to 75% of their compensation, subject to certain limitations and provides for matching contributions of employee contributions up to 4% of compensation and for discretionary profit sharing contributions. Under the Prior Plans, employees could contribute various percentages of their compensation ranging up to a maximum of 50% or 75%, depending on the respective plan, subject to certain limitations. The Prior Plans provided for matching contributions of employee contributions up to 6% depending on the respective plan. Some of these Prior Plans also permitted or required profit sharing contributions. In connection with the matching and profit sharing contributions, the Companies recognized compensation expense in 2011, 2010 and 2009 as follows:
|  | 2011 |  | 2010 |  | 2009
Wendy’s Restaurants |  | $ | 7,944 |  |  | $ | 10,179 |  |  | $ | 9,743 |
Corporate |  | — |  |  | — |  |  | 898 |
The Wendy’s Company |  | $ | 7,944 |  |  | $ | 10,179 |  |  | $ | 10,641 |
Pension Plans Wendy’s had two domestic defined benefit plans (the “Wendy’s Pension Plans”), the benefits under which were frozen in 2008. Wendy’s obtained an actuarial valuation of the unfunded pension liability as of September 29, 2008 and received approval for the termination of the Wendy’s Pension Plans by the Pension Benefit Guaranty Corporation and the Internal Revenue Service by the fourth quarter of 2008. We made lump sum distributions and purchased annuities for the approved termination of the Wendy’s Pension Plans in 2008 and paid $304 for certain plan settlements in 2009. In 2010, a final payment of $296 was made to the Pension Benefit Guaranty Corporation for one of the pension plans. (The Wendy’s Company) The Wendy’s Company maintains two domestic defined benefit plans, the benefits under which were frozen in 1988 and for which The Wendy’s Company has no unrecognized prior service cost. Arby’s employees who were eligible to participate through 1988 (the “Eligible Arby’s Employees”) are covered under one of these plans. Pursuant to the terms of the Arby’s sale agreement, liabilities related to the Eligible Arby’s Employees under these plans were retained by Wendy’s Restaurants. In addition, Wendy’s Restaurants received $400 from Buyer for the unfunded liability related to the Eligible Arby’s Employees under the plans as of July 4, 2011. In conjunction with the sale of Arby’s, Wendy’s Restaurants transferred the liabilities related to the Eligible Arby’s Employees to The Wendy’s Company. The measurement date used by The Wendy’s Company in determining amounts related to its defined benefit plans is the same as the Company’s fiscal year end. The balance of the accumulated benefit obligations and the fair value of the plans’ assets at January 1, 2012 was $3,926 and $2,557, respectively. As of January 2, 2011, the balance of the accumulated benefit obligations and the fair value of the plans’ assets was $3,983 and $2,669, respectively, of which $1,227 and $839, respectively, was recorded by Wendy’s Restaurants related to the Eligible Arby’s Employees. As of January 1, 2012 and January 2, 2011, each of the plans had accumulated benefit obligations in excess of the fair value of the assets of the respective plan. The Wendy’s Company recognized $303, $157, and $175 in benefit plan expenses included in “General and administrative” in 2011, 2010, and 2009, respectively. In addition, the Companies recognized $47, $64 and $68 in benefit plan expenses related to the Eligible Arby’s Employees in 2011, 2010, and 2009, respectively, which is included in discontinued operations. The Wendy’s Company’s future required contributions to the plan are expected to be insignificant. Multiemployer Pension Plan The unionized employees at The New Bakery Co. of Ohio, Inc. (the “Bakery”), a 100% owned subsidiary of Wendy’s, are covered by the Bakery and Confectionery Union and Industry International Pension Fund (the “Union Pension Fund”), a multiemployer pension plan with a plan year end of December 31 that provides defined benefits to certain employees covered by a collective bargaining agreement (the “CBA”). The cost of this pension plan is determined in accordance with the provisions of the CBA. In 2009, the Bakery terminated its participation in the Union Pension Fund and formally notified the plan’s trustees of its withdrawal from that plan. This decision required Wendy’s to assume a withdrawal liability of $4,975 in accordance with the applicable requirements of the Employee Retirement Income Security Act, as amended, to reflect this obligation which has been included in “Cost of sales.” In addition, the unionized employees became eligible to participate in the 401(k) Plan. In 2010, the terms of a new collective bargaining agreement (the “New CBA”) were agreed to by the Bakery and Bakers Local No. 57, Bakery, Confectionery, Tobacco Workers & Grain Millers International Union of America, AFL-CIO. Included in the terms of the New CBA, the Bakery agreed to participate in the Union Pension Fund as if it had not previously withdrawn its participation and the unionized employees would no longer be eligible to contribute to the 401(k) Plan. Accordingly, the withdrawal liability recorded in 2009 was reversed in 2010 and credited to “Cost of sales.” The other terms of the New CBA resulted in additional expense to Wendy’s of approximately $900 (which includes $600 of contributions reflected in the table below), which is included in “Cost of sales,” in 2010. The future cost of the Union Pension Fund depends on a number of factors, including the funding status of the plan and the ability of other participating companies to meet ongoing funding obligations. Participating employers in the Union Pension Fund are jointly responsible for any plan underfunding. While Wendy’s pension cost for the Union Pension Fund is established by the New CBA, the Union Pension Fund may impose increased contribution rates and surcharges based on the funded status of the plan and in accordance with the provisions of the Pension Protection Act (the “PPA”), which requires underfunded multiemployer pension plans to implement rehabilitation plans to improve funded status. Factors that could impact the funded status of the Union Pension Fund include investment performance, changes in the participant demographics, financial stability of contributing employers and changes in actuarial assumptions. The Union Pension Fund’s funding status, as defined by the PPA is “green”; however, the plan is significantly underfunded and the plan’s funding is under a rehabilitation plan as approved by the PPA. Assets contributed to the Union Pension Fund are not segregated or otherwise restricted to provide benefits only to the employees of the Bakery. The Companies could also be obligated to pay additional contributions (known as complete or partial withdrawal liabilities) due to unfunded vested benefits of the Union Pension Fund. The withdrawal liability (which could be significant) would equal the Companies’ proportionate share of the unfunded vested benefits based on the year in which the liability is triggered. A withdrawal liability would be triggered if the Companies (1) cease to make contributions to the Union Pension Fund, (2) close its bakery facility, or (3) decide not to renew the collective bargaining agreement. No factors for which the Bakery would incur a withdrawal liability occurred during fiscal 2011. Further information about the Union Pension Fund is presented in the table below:
|  |  |  | Pension Protection Act Zone Status (a) |  | Funding Improvement Plan/Rehabilitation Plan Status |  | Wendy’s Contributions (b) |  | Surcharge Imposed |  | Expiration Date of Collective Bargaining Agreement
Pension Fund |  | EIN |  | 2011 |  | 2010 |  |  | 2011 |  | 2010 |  | 2009 |  |
Union Pension Fund |  | 52-6118572 |  | Green |  | Green |  | Implemented |  | $ | 781 |  |  | $ | 766 |  |  | $ | 641 |  |  | No |  | 3/31/2013
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(a) | The Union Pension Fund elected an expanded asset smoothing period of 10 years for the investment loss incurred in the plan year ended December 31, 2008 and an increase in the limits on the actuarial value of the assets to 130% of market value for the plan years beginning January 1, 2009 and 2010, as permitted under the Preservation of Access to Care for Medicare Beneficiaries and Pension Relief Act of 2010. The Union Pension Plan certified its zone status after making this election.
(b) | In accordance with the terms of the New CBA, the Companies are required to make minimum contributions of $2.73 per hour of employment for each employee covered under the Union Pension Fund. As of January 1, 2012, based on approximately 308,000 hours of expected employment, the Companies’ minimum annual contribution to the Union Pension Fund would be $840.
Wendy’s Executive Plans In accordance with the agreement for the merger with Wendy’s, amounts due under key executive agreements and supplemental executive retirement plans (the “SERP”) were funded into a restricted account. Effective January 1, 2011, participation in the SERP was frozen and current participants’ balances only earn interest. The corresponding SERP liabilities have been included in “Accrued expenses and other current liabilities” and “Other liabilities” and, in the aggregate, were approximately $4,450 and $5,391 as of January 1, 2012 and January 2, 2011, respectively.

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