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Employee Benefit Plans
 12 Months Ended
Mar. 03, 2012
Employee Benefit Plans [Abstract]  
Employee Benefit Plans

9 Employee Benefit Plans

401(k) Retirement Plan

The Company sponsors a single 401(k) retirement plan covering substantially all full-time non-union employees, as well as union employees at two of its manufacturing facilities. The plan historically included a discretionary annual Company contribution based on a percentage of employees' base earnings and years of service with the Company for all eligible non-union employees and for eligible union employees according to the terms of union contracts. The discretionary annual contribution was discontinued effective January 1, 2011. As a result, the fiscal 2011 contribution was only for the 10 months ending December 31, 2010. The contribution was $3.7 million and $4.5 million in fiscal 2011 and 2010, respectively.

 

In addition to the contribution above, employees are also allowed to contribute up to 60 percent of their eligible earnings to this plan, up to statutory limits. Effective March 1, 2011, the Company contributes a match of 100 percent of the first one percent contributed and 50 percent of the next five percent contributed on eligible compensation that non-union employees contribute and according to contract terms for union employees. Prior to that date, the Company contribution was 30 percent of the first six percent of eligible compensation that non-union employees contributed and according to contract terms for union employees. The Company match was $3.6 million for 2012 and was $1.7 million in each of fiscal 2011 and 2010.

Deferred Compensation Plan

The Company maintains a deferred compensation plan that allows participants to defer compensation and assist in saving for retirement and certain short-term needs. The deferred compensation liability was $2.5 million at March 3, 2012 and is included in other long-term liabilities in the consolidated balance sheet. The deferred compensation plan has historically been unfunded. In fiscal 2012, the Company invested in corporate-owned life insurance policies (COLI) and mutual funds with the intention of utilizing them as a long-term funding source for the deferred compensation plan. COLI assets of $1.5 million at March 3, 2012, are recorded at their net cash surrender values and are included in other non-current assets in the consolidated balance sheet. Mutual fund investments of $1.2 million at March 3, 2012, are recorded at estimated fair value, based on quoted market prices, and are included in other non-current assets in the consolidated balance sheet.

Plans under Collective Bargaining Agreements

The Company contributes to various multi-employer union retirement plans, which provide retirement benefits to the majority of its union employees; none of the plans are considered significant. The total contribution to these plans in fiscal 2012, 2011 and 2010 was $3.9 million, $4.2 million and $5.8 million, respectively.

Pension Plan

As part of the acquisition of Tubelite in fiscal 2008, the Company assumed the assets and liabilities of the Tubelite, Inc. Hourly Employees' Pension Plan (Tubelite plan). This plan is a defined-benefit pension plan that was frozen to new entrants and additional years of service credit for participating employees as of January 1, 2004.

Officers' Supplemental Executive Retirement Plan (SERP)

The Company sponsors an unfunded SERP for the benefit of certain executives. The plan is considered a defined-benefit pension plan which is based principally on an employee's years of service and compensation levels near retirement.

On October 8, 2008, the Company's Board of Directors adopted an amendment to the Apogee Enterprises, Inc. Officers' Supplemental Executive Retirement Plan providing that no more benefits will accrue to plan participants as of December 31, 2008. Plan participants continue to earn service for the purpose of becoming vested in the benefits they had accrued as of December 31, 2008.

Obligations and Funded Status of Defined-Benefit Pensions Plans

The following tables present reconciliations of the benefit obligation of the defined-benefit pension plans and the funded status of the defined-benefit pension plans. Both the Tubelite plan and the SERP use a fiscal year-end measurement date.

 

(In thousands)

   2012     2011  

Change in benefit obligation

     

Benefit obligation beginning of period

    $ 12,778      $ 11,911   

Interest cost

      654        665   

Actuarial loss

      2,221        836   

Benefits paid

      (879 )      (634 ) 
  

 

 

    

 

 

  

Benefit obligation at measurement date

    $ 14,774      $ 12,778   
  

 

 

    

 

 

  

Change in plan assets

     

Fair value of plan assets beginning of period

    $ 4,549      $ 4,688   

Actual return on plan assets

      224        142   

Company contributions

      678        353   

Benefits paid

      (879 )      (634 ) 
  

 

 

    

 

 

  

Fair value of plan assets at measurement date

    $ 4,572      $ 4,549   
  

 

 

    

 

 

  

Funded status— net amount recognized

    $ (10,202 )    $ (8,229 ) 
  

 

 

    

 

 

  

 

Amounts recognized in the consolidated balance sheets consist of:

 

(In thousands)

   2012     2011  

Current liabilities

    $ (1,001 )    $ (644 ) 

Other long-term liabilities

      (9,201 )      (7,585 ) 
  

 

 

    

 

 

  

Total

    $ (10,202 )    $ (8,229 ) 
  

 

 

    

 

 

  

Amounts included in accumulated other comprehensive loss that have not yet been recognized as components of net periodic benefit cost consist of:

 

(In thousands)

   2012      2011  

Net actuarial loss

    $ 4,335       $ 2,244   
  

 

 

     

 

 

  

Accumulated other comprehensive loss

    $ 4,335       $ 2,244   
  

 

 

     

 

 

  

The amount recognized in comprehensive earnings for fiscal 2012 and 2011, net of tax expense, is as follows:

 

(In thousands)

   2012      2011  

Net actuarial loss

    $ 1,331       $ 506   
  

 

 

     

 

 

  

Total

    $ 1,331       $ 506   
  

 

 

     

 

 

  

Components of the defined-benefit pension plans net periodic benefit cost are as follows:

 

(In thousands)

   2012     2011     2010  

Interest cost

    $ 654      $ 665      $ 681   

Expected return on assets

      (214 )      (225 )      (177 ) 

Amortization of unrecognized transition amount

      —          —          (5 ) 

Amortization of unrecognized net loss

      120        126        57   
  

 

 

    

 

 

    

 

 

  

Net periodic benefit cost

    $ 560      $ 566      $ 556   
  

 

 

    

 

 

    

 

 

  

The estimated net actuarial loss for the defined-benefit pension plans that will be amortized from accumulated other comprehensive loss into net periodic benefit cost for fiscal 2013 is $0.2 million, net of tax benefit.

Additional Information

Assumptions

Weighted-average assumptions used at the measurement date to determine the defined-benefit plans' benefit obligation for the following fiscal years are as follows:

 

(Percentages)

   2012      2011      2009  

Discount rate

      4.00         5.25         5.75   

Weighted-average assumptions used at the measurement date to determine the defined-benefit plans' net periodic benefit cost for the following fiscal years are as follows:

 

(Percentages)

   2012      2011      2010  

Discount rate

      5.25         5.75         6.75   

Expected return on assets

      5.50         5.50         3.75   

Discount rate. The discount rate reflects the current rate at which the defined-benefit plans' pension liabilities could be effectively settled at the end of the year based on the measurement date. The discount rate was determined by matching the expected benefit payments to payments from the Principal Discount Yield Curve. This produced a discount rate of 4.00 percent. There are no known or anticipated changes in the discount rate assumption that will impact the pension expense in fiscal year 2013.

Expected return on assets. To develop the expected long-term rate of return on asset assumption, the Company considered historical long-term rates of return for broad asset classes, actual past rates of return achieved by the plan, the general mix of assets held by the plan and the stated investment policy for the plan. This resulted in the selection of the 5.50 percent long-term rate of return on assets assumption.

 

Net periodic benefit cost. Total net periodic pension benefit cost was $0.6 million in each of fiscal 2012, 2011 and 2010. Total net periodic pension benefit cost is expected to be approximately $0.6 million in fiscal 2013. The net periodic pension benefit cost for fiscal 2013 has been estimated assuming a discount rate of 4.0 percent.

Contributions

Pension contributions to the plans for fiscal 2012 and 2011 totaled $0.7 million and $0.4 million, respectively. Since the SERP is unfunded, contributions to that plan represent benefit payments made. The pension contributions in fiscal 2012 and 2011 equaled or exceeded the minimum funding requirement. Fiscal 2013 pension contributions are expected to total $0.9 million.

Estimated Future Benefit Payments

The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid by the plans as follows:

 

(In thousands)

  

 

  

Fiscal 2013

    $ 1,001   

Fiscal 2014

      989   

Fiscal 2015

      975   

Fiscal 2016

      971   

Fiscal 2017

      966   

Fiscal 2018-2022

      4,677   
  

 

 

  

Plan Assets

The Company does not maintain assets intended for the future use of the SERP. In accordance with its policy, the assets of the Tubelite plan have been invested in fixed-income securities with maturities intended to match benefit payments. The fixed-income securities are carried at fair value based on prices from recent trades of similar securities, and are classified as Level 2 in the valuation hierarchy.

Employee Stock Purchase Plan

The Company also sponsors an employee stock purchase plan into which its employees may contribute up to $500 per week on an after-tax basis. The Company contributes a match of 15 percent of the employee contribution. Contributions and Company match funds are used to purchase shares of Company stock on the open market. The Company match to this plan was $0.1 million in each of fiscal 2012, 2011 and 2010.